Regeneration specialist St Modwen has said the residential land market had started to recover as it recorded its first full-year profit in three years.
The firm, which specialises in town centre redevelopment and bringing former-industrial sites back to life, posted pre-tax profits of £37.5 million in the year to November 30, compared to losses of £119.4 million the previous year.
The last time it posted pre-tax profits was in the year to November 2007, before the financial crisis sent the property market into freefall.
The Birmingham-based firm reported a £23 million increase in the value of its properties, as the price of residential land regained some of its value, which it said may reflect the start of a recovery in the market, and the value of commercial land stabilised.
Profits from the sale of property nearly trebled to £21.9 million, while revenues from rents increased 5% to £46 million.
A detailed planning application has now been submitted for a £70 million regeneration of Longbridge town centre near Birmingham, it also announced.
The application includes plans for a supermarket, retail park and restaurants and 40 apartments and will form a focal point for the overall £1 billion regeneration of the former MG Rover car plant at Longbridge.
St Modwen, which said it has a strong landbank, also announced that it bought land from UK Coal at Pelsall in Walsall and Castle Gresley in Derbyshire.
It is also taking part in a joint-venture to develop 2,000 homes over seven sites with homebuilder Persimmon.
Shares in St Modwen are up 3% following the results, which Chris Millington, an analyst at Numis Securities, described as “a solid performance against a difficult market backdrop”.