This ambitious announcement has been made following the Government's announcement that it would bring forward the second phase of its Help to Buy scheme. The scheme will allow both existing and first time buyers with deposits as small as 5% to buy homes worth up to £600,000. The scheme is expected to increase demand for homes and help to push up the average property prices in England.
Cala has a land bank of more than 10,000 owned and contracted plots with a potential development value of £3.2 billion. This announcement comes following a 37% increase in underlying profit to a record £12.5 million for the year to the 30 June. Gross margins rose from 16.4% to 18.8% in the year.
Stephen Rawlinson, an analyst at Whitman-Howard told the Financial Times: "The issue is whether Cala can expand as it says, mainly in the south of England, and double its size. Clearly, the intention is likely to be to float the company and there are two angles now. Firstly, will it float and, secondly, by being so bold in its expansion plans will it affect others?"
According to the Financial Times, when asked about an IPO within the next six months Alan Brown, the chief executive of Cala said "We're thinking much longer term than that."
