Berkeley Group Holdings

History

The company was founded by Tony Pidgley and Jim Farrer in Weybridge in 1976 as Berkeley Homes, a name borne by regional subsidiaries. Pidgley (the dominant partner) and Farrer had previously run the housing division of Crest Homes and they aimed to focus on executive housing on single plots or small sites. Over the next few years, Berkeley expanded across the home counties, and while building less than 100 houses per year, it floated its shares on the Unlisted Securities Market in 1984.

Following the flotation, Berkeley Group expanded geographically to the west, the south midlands, and East Anglia; it also formed a joint venture, St George, to build in central London. By 1988, Berkeley was building over 600 executive homes per year. By then, Pidgley was aware of the overheating in the housing market and sold houses aggressively to realise cash. For two years the company did no more than break even, but its cash position was strong; during 1991, it was able to purchase the Manchester-based Crosby Homes and the outstanding 50 per cent of St George. That same year, it also announced the creation of a joint venture with the Saudi Arabian firm Saad Investments that involved a £100 million investment. In May 1992, Jim Farrer stepped down as the firm's chairman, becoming a non-executive director.

During March 1993, amid strong fiscal results, Berkeley Group announced its intention to raise £44.1 million via a rights issue. Later that year, the company announced it had made a pre-tax profit of £12.6 million, up to 83 per cent over the prior year, while unit sales rose to 656 from 468. Amid the early 1990s recession, Berkeley Group opted to purchase numerous large development sites at distressed prices. It was during the 1990s that Berkeley changed its operational orientation towards major urban regeneration sites in London, Birmingham, Manchester, and other northern cities.

Tony Pidgley's son, Tony Kelly Pidgley, became an employee of Berkeley Group after it purchased his own company, Thirlstone Homes, in exchange for £15 million and appointed him as the managing director of the Berkeley Homes division in August 1998. During February 2001, Pidgley Junior resigned from his position on the board, citing differences of opinion over the direction of Berkeley Group; he subsequently founded the rival building company Cadenza. Two years later, Pidgley Junior reportedly intended to take ownership of Berkeley Group with the aid of several external financial backers.

During the early 2000s, Berkeley Group refined its strategy to concentrate primarily on relatively large scale urban redevelopments in the London area. In 2003, it announced the deferred sale of Crosby Homes; the reduction in scale was intended to generate surplus cash, and a scheme of arrangement to return £1.45 million to shareholders was launched in 2004. Two years later, Crosby Homes was sold to the Australian developer Lend Lease in exchange for £261 million. That same year, the firm announced its plan for a new housing project that would produce net zero carbon dioxide emissions, which it claimed to be one of the first such developments in the world.