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LONDON (Alliance News) - Trafalgar New Homes PLC said Tuesday it has only sold four units at the 12-unit development at Oakhurst Park Gardens in Kent, due to unexpected planning delays and the decision not to proceed with an investor buyer, which means its financial results for the year just ended will be significantly below market expectations.
"It had been anticipated by the company that the twelve units at Oakhurst Park Gardens would have been sold with a view to the profit being generated being recognised," the company said in a statement.
Shares in the AIM-quoted property developer dropped 11% or 0.38 pence Tuesday morning, trading at 3.00 pence, after it said that its financial results for the year ending March 31 will be well below expectations and that it will postpone the payout of a dividend.
"It was...the board's intention to pay a dividend as a result of sales at Oakhurst Park Gardens, but this also will be postponed, and the board will seek to pay dividends as soon as financially possible," it said.
Trafalgar New Homes, which operates in Kent and the South East of England, said sales at its Oakhurst Park Gardens development in Hildenborough, Kent were held back by a combination of factors.
It said that it has had considerable interest in Oakhurst Park Gardens from prospective buyers. However the 12-unit development faced significant delays in the approval of amended planning permission.
The group said it secured sales for four of the units, and it also has been in negotiations with an investor buyer for the purchase of the eight remaining units. However it did not proceed with the transaction.
"After careful consideration, it has been decided that it is not financially economical nor in the best interests of the company to proceed with the proposed transaction," Trafalgar New Homes said.
It said that as a result, as at year end, it had only sold four units at Oakhurst Park Gardens, with a further two now under offer, although the company said that it is confident that further sales will be achieved at Oakhurst Park Gardens in the next quarter.
Trafalgar New Homes said that elsewhere construction work is underway on the two-house scheme at Ticehurst in East Sussex, and at Sheerness in Kent it said that contractors are pricing up the six-house scheme to start construction in the near future.
The property developer said that planning process is being progressed at its major site at Staplehurst in Kent, and it is confident that planning will be forthcoming during the first half of this year.
Also in the pipeline, the company said, contracts have been exchanged to buy a two-house development project in Borough Green in Kent, with planning permission and work on site will be starting within the next three months. In addition, negotiations are taking place to buy two further sites conditional on planning consent being granted in Tunbridge Wells and Matfield in Ken.
By Rowena Harris-Doughty; rowenaharrisdoughty@alliancenews.com; @rharrisdoughty
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