PROFILE | Caro prepares to ‘step things up’

Developers could be forgiven for taking their foot off the gas during uncertain times, but Liverpool-based Caro Developments views the post-pandemic landscape as an opportunity, rather than an obstacle. 

“We aren’t a small developer anymore. We are going to the next level,” Steve Smith, Caro’s development director, told Place North West. 

The firm recently acquired a site on Brassey Street in Liverpool’s Baltic Triangle, an area undergoing dramatic regeneration as the city council and developers seek to take advantage of its reputation as a creative hub. 

Caro bought the site from an LPA receiver for an undisclosed sum after a failed attempt by a previous developer to deliver an apartment scheme, explained Caro’s founder Neil Carlyle. 

Architecture practice Studio RBA was appointed to design a fresh scheme for the site and Caro is wasting no time in drawing up plans to submit to Liverpool City Council. 

The Brassey Street site could deliver an apartment complex with a gross development value of £25m, and Caro is in discussions over further opportunities elsewhere worth £50m, Carlyle said. 

Meanwhile, the firm is on track to deliver its £14.5m Poet’s Place project, comprising 127 apartments north of the city centre, designed by architect Falconer Chester Hall.

Caro converted the former Reece’s Ballroom into 91 apartments

The project, being built by Newry Construction, is scheduled to complete on time next May and all of the apartments have been sold, something Smith says is an indication of Caro’s reliability in meeting delivery timeframes. 

“Our investors and partners are seeing that we can deliver, and it breeds confidence in them and gives us the confidence to take the next step,” Smith said. 

When construction ground to a halt across the country during the height of the pandemic, Poet’s Place continued unabated. “Given the environment, this is something of which we are quite proud,” said Smith. 

Carlyle established the company in 2014 then joined forces with Smith, formerly a quantity surveyor at Balfour Beatty, three years later.

In 2017, Caro completed the conversion of the former Reece’s Ballroom on Parker Street, where John and Cynthia Lennon married in 1962, into apartments.

Caro is now eyeing growth and expansion, but with a foundation of caution. “We are risk-averse but in a positive way,” Smith said. 

The scars of the previous recession, when Carlyle admits he was lucky not to lose money on a 30,000 sq ft office complex he developed before founding Caro, have shaped the firm’s approach. 

Newry Construction is on site at Poet’s Place

Said Carlyle, who started out as a commercial painter and decorator: “It was a traumatic period and it affected our appetite for risk. We are really cautious about what we take on to make sure it is deliverable.  

“It is important to ensure you do what you say you’re going to. We don’t want a reputation for over-promising and under-delivering.” 

In recent years, several high-profile failed schemes in Liverpool have caused reputational damage to the city’s development credentials and Carlyle is determined to steer clear of trouble. “There have been loads of horror stories and I don’t want my face in the paper,” he said. 

Naturally, Caro’s cautious approach has led to missed opportunities but, as Carlyle says, “there is a limit to how much you can invest at once.”

Both men say there was no “grand plan” in the early days of Caro, which now employs around 15 people. Instead, the pair chose to be “opportunistic” and avoid taking on too much too soon. 

“We didn’t have any aspirations to build a big-name brand,” Carlyle said. “It was intended initially to do smaller bespoke developments, which is what we have been able to achieve.”

‘We can deliver everything time after time and, in today’s market, that’s a massive thing’ – Smith

Added Smith: “A lot of other developers are over-exposed. We aren’t, that’s the difference. The positive lessons that came out of a recession are embedded in Caro’s DNA.” 

But, after a solid start, both Smith and Carlyle agreed it is now time to push on and start looking for bigger opportunities. 

“We are looking towards larger apartment schemes up to 250 units, ideally in locations where we can attract more institutional investment,” Carlyle said.  

“We have a couple of high-net-worth partners that want to invest with us and that would allow us to [tap] that market.” 

Growth is the aim, but the fundamentals that have seen the firm establish a solid footing to build on will endure. 

Old School Gardens in Aughton is one of Caro’s smaller schemes

“We aren’t going to change our mentality because it has been successful, but we are going to take on board our investors’ confidence and step things up a bit,” Smith said. 

“The word we use a lot is ‘deliverability’. That’s our USP. We can deliver everything time after time and, in today’s market, that’s a massive thing,” he added. 

Caro’s reputation for quality and reliability is seeing more work being sent its way. “The amount of opportunities we get on a daily basis has taught us how to say ‘no’,” Carlyle said. “It is hard, as we get two or three schemes across our desk every day.” 

The next step in Caro’s journey will see the firm branch away from Liverpool for the first time with office-to-residential conversions in the pipeline in Wigan and Preston. 

The company also has half an eye on a move into Manchester, although Carlyle admits now might not be the best time to venture into the city given the disparity in land values between Liverpool and pricier Manchester. 

Liverpool will remain Caro’s main focus – it is a city the pair said holds “massive potential”. 

“Ten Streets, North Shore, Liverpool Waters and the Baltic Triangle are all areas we are looking at. There is still an appetite for investors that are keen on Liverpool despite the negative press over the last few years,” Carlyle said.