Region’s ‘buoyant’ housing market counters Savills’ profit dip

The real estate consultancy’s pre-tax profit declined almost 30% year-on-year in 2020 but the results were solid given the challenging market conditions, it said.

James Evans, head of Savills Manchester, noted: “2020 was a year of huge uncertainty in the sector. However, these results are testament to both the strength and depth of our varied service lines, not to mention our people.

“The Savills Manchester office has been involved in some of the largest residential and commercial transactions during 2020, while our consultancy and property management teams have performed exceptionally in an uncertain market.”

While Savills’ statutory pre-tax profit fell to £83.2m for the full-year 2020, revenues saw a softer decrease, of just 9% to £1.74bn, according to a statement from the company today. Savills noted that “resilient revenues from less transactional services [such as property and facilities management, down only 1% year-on-year] significantly mitigated a reduction in transaction volumes”.

In the North West, the housing market outperformed other sectors and contributed to a strong performance by the firm’s residential agency offices – although Savills does not break down its financials by region or property sector.

Said Charlie Kannreuther, head of residential sales at Savills in the North West & West Midlands: “Growing market share proved to be the key to another successful year in the region. Our Cheshire residential offices performed extremely well in what was a quite extraordinary year in the housing market.

“The confidence in the region’s housing market remains strong as a popular relocation market, further boosted by strong demand from those who want the benefit of countryside living within striking distance of a bigger, well-serviced town or city.”

Meanwhile, London Stock Exchange-listed Savills said its net cash position stood at £177.7m for FY2020 against £28.5m in 2019, and that it would pay out a final ordinary dividend of 17p “reflecting the resilience of the less transactional business performance”.

Group chief executive Mark Ridley said: “We remain confident in the long-term attraction of real estate as an asset class and although macro-economic uncertainty resulting from Covid-19 clearly remains, we see enhanced investor demand for income and improvements in leasing activity as occupiers increasingly seek to address their requirements.

“Savills has a strong balance sheet and we remain focused on growing our less transactional businesses, increasing our share of the global transactional markets and enhancing the resilience of the business overall.

“We have made a good start to 2021 and see opportunities for business development emerging during the course of the year.”