IKEA launches pre-fab homes in the United Kingdom
The Swedish home decor and furnishings retailer announced plans to sell the “Boklok” homes in December, some for under $200,000.
Swedish home decor and furnishings retailer IKEA has launched its “Boklok” pre-fabricated homes in the United Kingdom, following a December announcement of plans to build 500 housing units in the United Kingdom by 2009. The first units went on sale Oct. 5.
The homes will be priced at around 100,000 pounds (US$197,000) per flat and 150,000 pounds (US$296,000) per three-bedroom home. Some financing options allow customers to pay even less, according to the Financial Times – Boklok developer LiveSmart at Home offers one-bedroom flats for around 49,000 pounds (US$100,000) plus a monthly rental fee.
The pre-fabricated homes have been billed as a solution to affordable housing problems in the United Kingdom. IKEA is partnering with construction company Skanska to build the units. About 3,500 Bokloks already have been built in Scandinavia through IKEA’s partnership with Skanska.
The first Boklok community is planned for the city of Gateshead in northeastern England. Further communities are planned in Scotland and southeast England.
Could PPG be one to watch?
PPG Architectural Finishes, the paint and coatings division of chemical, glass and plastics giant PPG Industries, has long lagged behind its larger competitors — Sherwin-Williams, Benjamin Moore, ICI, Dunn-Edwards and Kelly-Moore.
But following the sale announced in September of two of PPG’s fine chemicals businesses to an Italian firm, PPG CEO Charles Bunch said the company plans to focus on becoming the “leading coatings and specialty products and services company.”
The numbers certainly support his goal, as well as a slew of recent international acquisitions and new product offerings.
The company’s retail store base has shown exponential growth in the past 10 years, going from 126 locations in 1998, to 315 in 2004, to 448 in 2006, according to the Home Channel News Top 500 Scoreboard of home channel retailers.
PPG Architectural Finishes ranks 45 on that list, moving up from 53 last year. Sales in the coatings business rose to $240 million, again showing wide gains over previous years — $155 million in 1998, $194 million in 2004 and $200 million last year.
Including all of its divisions, PPG’s second-quarter sales passed the $3 billion mark, making it the “17th consecutive quarter in which we delivered a year-over-year sales record,” according to William Hernandez, senior vp and CFO, in the company’s second-quarter conference call.
The record performance “was led by our strongest operating margin businesses,” particularly in architectural coatings, which saw sales rise 31 percent, Hernandez said.
The company saw much of its coatings growth through international sales. Still, sales at coatings stores also contributed to growth of about 2 percent, in spite of a downturn in the residential construction market. In this way, PPG has shown the strength inherent in a diversified customer base — while housing starts declined 20 percent, Hernandez said, commercial construction grew 8 percent. PPG’s coatings business breaks down a sales base of approximately 10 percent residential consumers, 80 percent professionals and 10 percent to industrial and commercial customers.
“We have stated continuously that these businesses have large commercial construction content, and our performance certainly reflects that fact,” he said.
Additionally, PPG has made acquisitions worldwide in the past year. Most recently, the company acquired Barloworld Coatings Australia, which added 85 retail locations as well as the consumer paint brands Taubmans, Bristol and White Knight.
International acquisitions have been important, Hernandez said, in offsetting slower growth in North America. “We’ve experienced lower volumes in our professional channels, both in our stores and distributors,” he said. “We anticipate low growth rates in North America, sustained growth in Europe and continued high growth in China and other emerging regions.”
Other acquisitions in the past two years have included assets of Shanghai Sunpool Building Material’s paint brands O’need and Kaleidoscope, California’s Spectra-Tone paint and Australia’s Protec coatings business.
Like many home improvement companies, PPG does not anticipate a housing market recovery until “at least early 2008.” But with a coatings business so entrenched in the commercial and industrial market, it would appear the company is well positioned to grow in tough times.
Dominion Homes sees third-quarter sales fall 24.8 percent
Columbus, Ohio-based home builder Dominion Homes released a preliminary third-quarter sales report showing sales fell 24.8 percent to $29.6 million from $39.4 million in the same period last year.
Those figures reflect 153 homes sold in the third quarter, down from 209 homes sold during last year’s third quarter.
Dominion reported a backlog of 275 sales contracts — a total value of $57.8 million — down from 419 sales contracts in the same period last year, or a value of $84.6 million.
The average sales price for a home in backlog, the company reported, rose 5.7 percent to $210,300 from $202,000 last year.
The company will release its full financial results for the third quarter next month. The company had losses of $41.2 million in the first six months of the year, compared with a narrower loss of $11 million in the same period last year.
Dominion Homes builds homes and condominiums in Ohio and Kentucky.