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Two North Yorkshire Council housing companies are estimating to report a profit by the end of this financial year.

Brierley Homes and Bracewell Homes are expected to post improved performance after completing further sales, according to a council financial report.

Both companies were taken over by North Yorkshire Council in April 2023.

Bracewell, which is a former Harrogate Borough Council firm, is forecasting a profit return of £1.52 million by the end of 2023/24.

A report said the company had seen sales of shared ownership properties and the “receipt of rental income on the proportion retained within the company”.

However, it added that Bracewell was still awaiting the completion of purchasing a further two sites.

It said:

“The main challenge for the Company relates to receiving accurate information from developers.

“Bracewell is due to complete on house purchases at two sites this financial year however neither developer has managed to achieve their initial forecast completion dates.”

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Meanwhile, Brierley Homes, which was set up by the former North Yorkshire County Council, is forecasting a profit of £959,000 by the end of the year.

The figure is based on the company completing sales at sites in Marton cum Grafton, Pateley Bridge and Great Ouseburn.

Meanwhile, the firm is expected to start work on another housing site in Kirby Malzeard this year.

It comes as the council reported a “positive outlook” for the company in March amid an increase in sales.

Housing companies start work on 33-home Kirkby Malzeard scheme

Two North Yorkshire housing companies have announced a partnership which will see them build 33 homes at Kirby Malzeard, near Ripon.

It will see Brierley Homes, which is owned by North Yorkshire Council, and Broadacres Housing Association create a new development called Laverton Oaks.

Thirteen of the 33 houses will be classed as affordable.

Brierley Homes is delivering the scheme following an agreement to buy the land from Broadacres.

Work on the site is expected to be completed within two years.

Stuart Ede, managing director at Brierley Homes, said:

“This announcement is the result of 12 months of hard work and negotiations between ourselves and Broadacres on this and other schemes.

“It is an exciting partnership between two North Yorkshire companies that will deliver high-quality housing in areas of greatest need.”

Helen Fielding, director of development and investment at Broadacres, said:

“Working in partnership with Brierley Homes, we are pleased to be able to provide 13 much-needed affordable homes in this part of rural North Yorkshire.

“It’s important that we continue investing in even more affordable housing across the county, ensuring our rural communities remain sustainable for local people now and in the future.”

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Council’s Brierley Group set to return to profit

North Yorkshire County Council is estimating that its Brierley Group of companies will return to profit by the end of the financial year.

According to a performance report for the group, the businesses are forecast a £2.69 million profit before tax by the end of 2022/23.

The figure is against a budgeted profit of £2.61 million.

It comes as the companies had previously posted losses of £327,000 for the previous financial year due to the covid pandemic.

The county council puts the performance down to a “positive outlook” for sales in Brierley Homes sites and other companies performing above budget.

A report due before the council’s shareholder committee said that while revenue was ahead of budget, the group still faced cost increases, inflation and high energy and labour costs.

It said:

“Revenue remains significantly ahead of budget, however all market segments continue to experience material cost increases, with inflationary pressures in the UK acting to drive up general costs of sale.”

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Brierley Homes saw completion of two of its housing sites last year, which is expected to see sales “fully realises this financial year”, the report added.

The sites include Woodfield Square in Bilton and Millwright Park in Pateley Bridge.

The company expects further sales for its Yew Tree Farm site in Marton-Cum-Grafton.

Meanwhile, Align Property Partners is expected to publish a profitable position with “new external client contracts being acquired” and the firm having a “significant outperformance” against budget.

The company is expected to operate on a commercial basis under North Yorkshire Council as the authority sets up a new council-owned estates firm.

However, North Yorkshire Education Services is expected to post a loss for the financial year.

The council has put this down to “ongoing issues in the education market” due to covid, including rise in food costs in school catering and low pupil attendances levels.

The report said:

“Meal uptake in schools has not recovered in many areas to pre-covid levels which has led to dis-economies of scale.”

Harrogate councillors approve transfer of council-owned companies

Councillors have approved the transfer of Harrogate Borough Council’s wholly-owned companies to the new North Yorkshire Council next month.

HBC’s Conservative-run cabinet met last night at the Civic Centre to discuss a report written by the council’s head of legal and governance, Jennifer Norton.

The report recommends that leisure company Brimhams Active and housing company Bracewell Homes are passed over to the new council on April 1.

Harrogate Borough Council will be abolished on March 31 after being in existence since 1974.

The next day, a new unitary council for the whole of North Yorkshire will be created to deliver all the services currently delivered by Harrogate Borough Council and North Yorkshire County Council.

Wholly-owned companies

Brimhams Active launched in August 2020 when it took over control of leisure centres and swimming pools in Harrogate, Starbeck, Ripon, Knaresborough and Pateley Bridge.

It has overseen major projects such as the redevelopment of the Harrogate Hydro swimming pool and the construction of new facilities in Ripon and Knaresborough.

The new council will add Selby’s leisure services to the Brimhams Active portfolio from September 2024.

This will be whilst it undertakes a £120,000 review of leisure services with the aim of creating a countywide model for delivering leisure and sport by 2027.

Bracewell Homes was set up in 2019 with the aim of turning the council a profit and delivering affordable homes.

It is expecting to deliver 43 homes by the end of 2023/24, which will exceed its target of 40 homes by 2024.

North Yorkshire County Council already has a housing company called Brierley Homes and what will happen to Bracewell inside the new authority is unclear.

‘They’ve done very well for Harrogate’

At last night’s meeting, Conservative council leader Richard Cooper said the two companies have done “very well” for the soon-to-be abolished authority. He said:

“This to me seems very much like a tidying-up exercise, things that we need to do, belt and braces, in order to make sure that the transfer of borough council-owned companies transfers smoothly to the new North Yorkshire Council.

“I hope they will look after them because they’ve done very well for Harrogate Borough Council thanks to the expertise of the officers who have been guiding them.”

Cabinet members Sam Gibbs and Stan Lumley did not take part in the discussion or vote as they sit on the Brimhams Active board.

Council’s Brierley Group reports £327,000 loss

North Yorkshire County Council has reported a £327,000 loss for its Brierley Group of companies for the last financial year.

The council set up the group in 2017 to bring together council-owned companies and save money.

But the group, which includes housebuilding firm Brierley Homes, NY Highways and Yorwaste, reported the loss for the 2021/22 financial year against a budgeted profit of £324,000.

The group lost £639,000 in the previous financial year and the latest figures have raised questions about the council’s ability to run businesses.

According to a council report, authority officials put the loss down to the “impact of covid and the current and emerging market conditions”.

It remained confident that the Brierley Group would turn around the financial situation and post a profit in 2022/23.

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The council said the overall loss was “driven principally” by two of the companies, Brierley Homes and NYHIghways, posting losses for the year.

However, it added that Brierley Homes’ loss was in line with budget as three of its sites “were in a construction phase during the year” and expected sales were to be realised next year.

Brierley Homes Woodfield Square

The sites include Woodfield Square in Bilton, Millwright Park in Pateley Bridge and Yew Tree Farm in Marton-Cum-Grafton.

NYHighways’ loss was attributed to it being its first year of operation and “higher mobilisation and integration costs”, the report said.

The council report said:

“The expectation is a return to a positive profit after tax position through FY22/23.”

“Brierley Homes will see the sales completion of a number of sites; Woodfield Square, Millwright Park and Yew Tree Farm and NY Highways are now in a stronger position to refine and streamline the business, with other companies in the portfolio like First North Law, Align, NYnet and Veritau building on the successes of FY21/22 with high levels of customer retention and satisfaction as well as additional capacity and expertise into their teams.”

‘Sad state of affairs’

Stuart Parsons

Stuart Parsons

Cllr Stuart Parsons, leader of the Independent group on North Yorkshire County Council, described the loss as a “sad state of affairs”.

He added it would mean less money for vital services.

Cllr Parsons said:

“It’s a sad state of affairs. The company was created by North Yorkshire County Council to generate profits which would be used to support services like adult social care. 

“Expecting North Yorkshire County Council to guarantee this loss means that even less money is available for front-line services.

“North Yorkshire County Council obviously does not have the capacity, nor the ability, to run commercial companies.”

Cllr Gareth Dadd, the council’s executive member for finance, assets and resources, said:

“The Brierley Group includes several companies providing services for us and financially most performed well last year, with some outstripping expectations.

“While we are disappointed the group recorded an overall loss, we recognise the unique set of circumstances  which contributed to the position and are also reflected across the whole of the economy last year. However it should also not be forgotten that the profit or loss a Brierley group company makes is only part of the picture.

“All companies generate a value for North Yorkshire County Council as shareholder and last year the value of this was £5.6m through interest payments to the council alongside contributions towards council service costs.”

“We are confident in the outlook for the future as the group emerges from the challenges of covid and that it will return to a financial surplus in the current year.”