SAVILLS yesterday posted a nine per cent increase in full year profits to £40m after a boom in London prime residential property and strength in China helped to offset a stagnation in commercial activity in Europe.
The property agent’s UK residential business grew profits by 11 per cent to £20.4m in 2011, fuelled by a growing appetite from overseas buyers for houses in London’s golden postcodes.
Chief executive Jeremy Helsby said the London residential market had over the past decade become “very much an asset class” in its own right – comparing it to gold – as investors from Asia, US and Europe continue to buy into the capital as a safe-haven.
Profits at the company’s UK commercial transaction division nearly halved to £4.6m, due to tough market conditions and acquisitions during the year, while the group’s European commercial business doubled its losses in the year to £8.8m as uncertainty over the health of Europe’s economy has hit investor appetite for riskier assets in the region.
Commercial transaction volumes in Asia were hit by governments in Hong Kong and Singapore introducing measures which restrict borrowing. Overall, profit and revenue in the region grew by £2m and £17.7m respectively. Helsby said: “We anticipate a continuation of challenging transaction market conditions in the first half, with greater market confidence emerging to improve financial performance during the second half of the year.”