Real estate and construction businesses are the fastest growing in Sussex, Surrey and Kent, according to new research from accountancy and business advisory firm, BDO LLP.
The findings, published in BDO’s Best in Business sales growth report 2018-19, compiled in association with leading mid-market private equity firm LDC, reveal that a quarter of the top 100 fastest growing mid-sized businesses in the region operate in real estate and construction, two of which are in the top ten.
Over the previous 12 months, the total value of sales generated by these companies grew by 41 per cent and their headcount by 23 per cent. Collectively they contributed more than £844m to the economy.
Almost 50 per cent are located in Kent, while the remaining spread evenly across Surrey and Sussex. The vast majority are family or privately owned by the founder(s), and have been in business for more than ten years.
Kevin Cook, Partner at BDO Gatwick and Guildford, comments: “The South East is a vibrant part of the UK economy and home to some of the fastest growing businesses. These real estate and construction companies are successfully balancing the need for growth and development with the pressures from society for green open spaces.
“It’s no surprise they are performing well given the infrastructure, excellent transport links and demographics of the area. Over the past three years since we launched our Best in Business research we’ve seen the sector emerge as one of the strongest and most resilient.”
Thakeham Client, a construction and project management services specialist based in West Sussex, last year achieved sales of £20m. It has grown by 84 per cent over the last three years as a result of an increased demand for its services.
Similarly, Guildford-based housing developer Beaufield Homes increased sales by 78 per cent to £11.4m in the same timeframe. Kent-based fit out specialist Lucas UK Group has seen more than 60 per cent growth in revenue over the last three years to £30m turnover.
Danny Lucas, executive chairman & managing director at Lucas UK Group, explains: “I believe there are two key areas which have contributed to growth in this sector.
“Firstly, the London property market remains extremely attractive to overseas investors and, therefore, construction work continues to boom, providing a solid pipeline of work and opportunity for companies situated in the South East to grow. Secondly, organisations located outside of London benefit from more flexibility with great transport links, and the space to expand without paying London prices.
“Futureproofing your business by investing in innovation, technology and attracting young people is key as this positions you apart from everyone else in an ultra-competitive market, which, like many, is also affected by the general skills shortage in the UK.
“Clients want something different and for Lucas our approach has been to create ‘tomorrow's construction service’ with a sustainable workforce. We have invested in our own R&D technology facility and an innovation centre, as well as a new visitor and learning centre that we use to reach out to school-leavers. It’s important to showcase that construction is not about mud and boots but is a diverse, innovative, forward-thinking industry to work in, harnessing technology and digital that is open to all.”
Jonathan Caswell, Origination Director at LDC in the South, said: “Construction and real estate have experienced turbulence in recent years, but firms in the sector across Sussex, Surrey and Kent are defying the current decline in activity and achieving unprecedented levels of growth.
“This is largely being driven by the housebuilding sector, as developers in the region are seeing an uplift in new work in line with the government’s commitment to build more than 300,000 homes before 2021.”
According to BDO’s Best in Business sales growth report, the top 100 mid-market businesses across all sectors in Surrey, Sussex and Kent grew sales in excess of £4.5bn. They employed more than 23,000 people last year, and increased profits by 113% and revenues by 34.5% over the last three years.
Notes to Editors
The Top 100 league table and Ones to Watch can be found here.
Accountancy and business advisory firm BDO LLP provides integrated advice and solutions to help businesses navigate a changing world.
Our clients are Britain’s economic engine – ambitious, entrepreneurially-spirited and high growth businesses that fuel the economy.
We share our clients’ ambitions and their entrepreneurial mind-set. We have the right combination of global reach, integrity and expertise to help them succeed.
BDO LLP operates in 17 offices across the UK, employing 5,000 people offering tax, audit and assurance, and a range of advisory services. BDO LLP has revenues of £590m and is the UK member firm of the BDO International network.
The BDO International network provides business advisory services in 162 countries, with 80,000 people working out of 1,600 offices worldwide. It has revenues of $9bn.