Springfield Properties sells more land to reduce debt

Elgin-based Springfield Properties, which is building a number of new communities throughout Scotland, announced that it has signed a binding agreement for the sale of 45 acres of land for £4.2 million.

“The land equates to 190 plots, is fully owned by the group, such that the cash inflow to the group will be £4.2m,” said Springfield.

The group will receive £830k on completion of the sale, which is expected later this month, with the remainder to be paid by 22 May 2024.

“The proceeds from the sale will support the group’s ongoing target to reduce group debt.”

Springfield Properties CEO Innes Smith said: “We are pleased to have agreed another profitable land sale as we continue to deliver on our strategy to reduce our debt position.

“In the last two months, we have secured almost £10m in land sales, with the proceeds to all be received during the current financial year – and without any impact on our development pipeline for the coming years.

“We continue to receive strong demand for our large, high quality land bank.

“Accordingly, this sale, alongside others that we expect to conclude in the near-term, mean that we are well-positioned to meet our debt reduction targets.”  

On September 20, shares of Springfield Properties fell after it announced it will not make dividend payments until its bank debt is “materially reduced.”

Springfield also said it was pausing all speculative private housing development and it is “actively pursuing land sales.”

That’s despite the firm reporting that its revenue increased 29.2% to £332.1 million in the year ended May 31, 2023, “driven by the acquisitions of Tulloch Homes in December 2021 and Mactaggart & Mickel Homes in June 2022, reflecting their first full 12-month contributions.”