Our Agile Business Model

Business Model Circular 2016

The key to our agile business model is balancing resources, both land and cash, to enable regular land purchases and a constantly developing land bank. This feeds opportunities to the planning team who begin the value adding process by securing important planning permissions. The asset can then be monetised in several different ways: selling the land with planning permission, selling a proportion of the plots to developers, or utilising our housebuilding capabilities and selling houses directly to homeowners. Each of these processes is underpinned by an ongoing dual assessment — of the market conditions and customer demands, and our own cash and opportunity flow. The continual decision making and plan refining process based on these considerations means that Inland not only produce highly sought after homes and developments, but deftly balance their assets and cash, maintaining a responsive forward-looking financial strategy.

Income generating opportunities at Cheshunt, Hertfordshire

Assessment of Market Conditions

The planning teams undertake thorough research into sites before, during and after purchase, to establish the factors at play, from local authority restrictions or demands on the site and community pressures, to the nature of the landscape and its surrounding areas. Before an application is submitted, extensive consultation is undertaken with planning bodies to establish the parameters for a project. Our in-depth knowledge and experience as well as research into the specific area ensures that the proposed project is not only likely to be supported by the local council, but that there is high demand for the resultant properties and the project will be profitable. External consultants are used to advise on a range of aspects of the project, including sustainability, and once a plan is drawn up we continue to refine and adjust it based on the constant monitoring of local and market forces. As a result, we have a stellar track record of achieving planning permission even on the most difficult sites, and the resulting developments are tailor-made for the local community, completely transforming brownfield land into attractive homes and landscapes.

Holistic Assessment of Our Portfolio

When it comes to deciding on whether to sell the site with planning to developers or undertake the build internally, we assess influencing factors such as costs, timescales and location to decide on the most appropriate route to take. Considering the financing of a project build is critical to this decision making process, and we crucially assess this not only on a project basis, but in terms of how it will affect the cash flow of the Group as a whole. Inland procures funding from a number of sources, including joint ventures and loan finance. However, a major source of funding is using our own equity, and a holistic decision has to be made on whether certain consented sites should be realised into cash to finance future projects and overheads. The inbuilt flexibility and agility of this model allows us to operate sustainably, and undertake projects which deliver sound returns for our shareholders.

Revenue is principally generated from sale of homes, land and rental income. Large projects usually require a mixed use scheme, where Inland Homes will develop the commercial plots. We retain these commercial assets, which generates a continuous annual income that contributes towards covering our overheads.

Value to Developers

As housebuilders ourselves, we know how to meet the needs of potential developers in order for them to be able to begin building soon after acquiring the site from us. We ensure that any potential barriers to development are dealt with and that the planning permission is for the right housing mix and development size to maximise the potential value of the site.

When selling a portion of a site to a developer, they receive additional benefits. We co-ordinate with them over branding to ensure that the look and feel of their homes is in keeping with the development as a whole. We will install all of the infrastructure for the site, such as drainage, providing a platform for them to begin their development.

Value to Homeowners

We are proud of the developments we plan and design, and are always looking to create communities attractive to future residents. Delivering on our commitment to quality and comfort, developed sites feature open spaces, play areas and immaculate landscaping to suit the needs of a variety of people.

Identify Land

Our local insight and established relationships with vendors and public sector bodies mean that we are aware of opportunities to increase our land bank.

Acquire Land

Our financing resources and strong reputation as being trustworthy and reliable mean that we can act quickly to secure promising sites. Sites acquired can often deliver short term returns. This revenue can be generated from a number of sources, such as sale of surplus assets, rent from tenants, car parking and the sites being utilised as filming locations. The tenants that are already present on the site may become long-term sources of revenue if they remain on the site during and after the development process.

Achieve Planning Permission

Once a site is acquired, extensive research and stakeholder consultations continue to prepare our bids for planning permission. Our record of achieving planning permissions on sites is second to none.

Sell Land with Planning Permission to Developers

Once consent is achieved, we have the opportunity to sell the whole site with planning permission to developers or housing associations for a short term return.

Sell Part of the Site

By selling a portion of a site while carrying out infrastructure works and housebuilding on other parts, we deliver revenue in the medium term.

Develop the Whole Site

Building a whole development takes longer but maximises the revenue a site can deliver over the long term. Historically, the construction element of development projects would always be undertaken by principal contractors. We are now focused on developing the capability to self-deliver new homes.

 

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