Ilke Homes said that the new funding – the largest-ever raised by a UK modular housebuilder – would enable it to scale-up its operations, open a new factory and increase output capacity to 4,000 homes a year.
The funding round sees Fortress Investment Group joining Abu Dhabi-owned TDR Capital and Sun Capital as an owner of the business.
Ilke Homes makes volumetric housing units in a factory in Knaresbrough. Its latest accounts show that the company lost £34m before tax in the year to 31st March 2021 on turnover of £12.7m. Over its first three years of operation Ilke Homes has generated less than £24m in turnover and lost, in aggregate, £88.7m before tax.
However, it claims that it is is "now delivering over 1,000 homes a year and has secured a pipeline of over 4,000 homes, putting it on par with some of the UK’s biggest housebuilders".
Ilke Homes creditors include the British taxpayer, via Homes England, which lent it £30m in 2019 and then another £30m in 2021.
Rahul Ahuja, co-head of European credit at Fortress Investment Group, said: “We see Ilke Homes as the UK market leader in the manufacturing of modular housing and believe the company is uniquely positioned to increase the availability of high quality affordable housing in the UK while accelerating the transition to net zero.”
TDR Capital partner Jonathan Mitchell said: “The success of Ilke Homes’ capital raise in the context of the difficult current funding environment is testament to its innovative business model and dedicated management team. Having achieved triple digit growth across the group for successive years, Ilke Homes is strongly positioned and capitalised to deliver in a market with strong long term fundamentals.”
Ilke Homes chief executive Giles Carter said: “Our latest fundraise demonstrates that the private sector is increasingly recognising the investment case for change. With the race to net-zero well and truly underway, the next few years will be a decisive time in the history of housebuilding, so it’s important that true market disruptors are empowered to play a leading role.”
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