Most of Ilke Homes‘ Knaresborough staff are expected to remain at home on full pay next week as the company continues to seek a buyer.

The Stray Ferret understands a small number of staff will be in the Flaxby factory to help complete some orders and send them to site.

They will be joined by managers, who have remained at the factory this week after the workers were told a week ago to stay at home while the company sought investment.

The business was put up for sale this week and a source told the Stray Ferret its owners were now in “advanced talks” with a potential buyer.

In a statement issued earlier this week, the company blamed market conditions for its current situation:

“In 2020, Ilke Homes launched its turnkey development offering, where the company acquires land, secures planning permission and develops the site. This has been complicated by uncertainty over planning policy and rising build costs.

“While having delivered strong contribution margins, Ilke Homes now requires new investment to meet overheads, achieve further scale and become cash flow positive.

“The wider UK housing market has been hit by rapidly rising interest rates, which has reduced demand and resulted in housing starts falling below pre-pandemic levels.

“Official government figures have also revealed that planning applications in England have fallen to their lowest level in at least 16 years, thanks to uncertainty over planning policy and heightened build costs, highlighting the scale of the challenge in improving housing delivery.”

Read more:

• Knaresborough housebuilder up for sale as operations paused
• Staff sent home as Knaresborough housebuilder seeks urgent investment

Flaxby-based modular housing developer Ilke Homes has posted a loss of £41m in its latest annual report.

The company, which has 500 employees, builds homes at its factory on Flaxby Moor Industrial Estate near Knaresborough that are then delivered across the UK.

In the year to 31 March 2021, the company sold 199 homes, up by a third from the previous year.

The report says the company was “significantly impacted” by covid. It adds a restructuring and redundancy programme in summer 2020 led to the departure of 122 employees.

But it adds that the long-term future of the company is healthy and it aims to become a top 10 house builder within the next five years.

It adds:

“In spite of these significant interruptions to business operations and to the wider economic environment, the company continued to make meaningful process, with additional designs and approvals, factory automation and production process improvement leading to capacity growth, sales pipeline development and strengthening the senior management team.”

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Since the company was founded in 2018 it has yet to turn a profit, and has reported combined losses of over £100m.

Homes England, the government’s housing agency, has invested £60m into the company since 2019.

The Stray Ferret asked Ilke Homes for comment but did not receive one by the time of publication.