Taylor Woodrow plc
Address:
4 Dunraven Street
London W1Y 3FG
United Kingdom
Telephone: (020) 7629 1201
Fax: (020) 7493 1066
http://www.taywood.co.uk
Statistics:
Public Company
Incorporated: 1921
Employees: 7,963
Sales: £1.5 billion (US$2.43 billion) (1999)
Stock Exchanges: London
Ticker Symbol: TWOD
NAIC: 233210 Single Family Housing Construction; 233220 Multifamily Housing Construction; 233110 Land Subdivision and Land Development; 531120 Lessors of Nonresidential Buildings (Except Miniwarehouses)
Company Perspectives:
We are an international leader in housing, property and value added construction support.
We are committed to delivering a world class business by providing creative solutions for the built environment.
Key Dates:
1921: Frank Taylor builds two houses at the age of 16 and sells them at a profit.
1930: Taylor moves his business to London and begins developing Grange Park, a 1,200-home development.
1935: Taylor Woodrow becomes a public company.
1937: Company enters the construction and civil engineering field through the formation of Taylor Woodrow Construction.
1942: Firms involved in the supply of machinery and materials to the construction industry are acquired; they later form the basis for Greenham Trading and Greenham Construction Materials units.
1953: Taylor Woodrow (Canada) Ltd. is established and a controlling interest in Monarch Mortgage and Investments Ltd. is purchased.
1955: Company completes the world's first full-scale nuclear power station at Calder Hill.
1964: Firm enters the property investment field in the United Kingdom, through the formation of Taylor Woodrow Property Company.
1969: Taylor Woodrow Property is awarded a contract for developing St. Katharine Docks.
1993: A consortium that includes Taylor Woodrow completes construction of the Channel Tunnel.
1999: Company announces that it will focus on housing and property and deemphasize construction.
2000: Company exits from a number of construction activities and sells off Greenham Construction Material and Greenham Trading; Taylor Woodrow acquires the shares of Monarch Development it does not already own.
Company History:
Taylor Woodrow plc is a major U.K.-based home builder and property developer and lessor. The company's home building activities take place on an international basis through the development of single-family housing developments, apartment and condominium complexes, and golf course communities in the United Kingdom, the United States, Canada, Spain, and Australia. On the property development side, Taylor Woodrow builds, manages, and leases office buildings, office and industrial parks, shopping centers, and high-rise residential complexes in the United Kingdom and Canada. The company also operates a smaller-scale construction business that provides selective construction services to selected clients.
Founding of Company by a Teenager in the 1920s
Frank Taylor, the founder of Taylor Woodrow, was a shopkeeper's son who became a tycoon and a peer of the realm. He was born in Hadfield, near Glossop, Derbyshire, in 1905. His family lived in a small house with the front room converted into a fruit shop; by the age of 11, Frank was operating the business alone.
While Frank was still a teenager the family moved to Blackpool (in northwestern England) and his father set himself up as a fruit wholesaler. Frank learned the business by working for a rival wholesaler. By 1921 his father decided to buy a house, but he was unable to secure a loan. Sixteen-year-old Frank offered the following arrangement: he would put up £30, his father £70, and the bank, with whom Frank had negotiated, a £400 loan. Frank proposed to build two houses with the money, including one for his uncle. In the end, Frank with his family sold the newly completed houses, realizing a handsome profit.
Frank soon began building small developments of 20 to 30 houses. His plan was to make enough money to open a fruit wholesale business in California, but his early successes persuaded him to remain in the construction industry.
After a few years in business, government authorities realized that Frank was still a minor and ruled that his land and property deals were illegal. Frank's uncle Jack agreed to serve as his adult partner, but Jack's sole contribution was the addition of his surname, Woodrow, to the company's title.
In 1930, Frank Taylor moved his business to London where he purchased some marshy land near a proposed factory. After arranging another loan, he installed a pumping station to drain the land and built houses for the new factory's employees. He sold 50 houses in the first week at an average cost of £450 each. The estate, Grange Park, took three years to complete and contained 1,200 homes. By 1934, Taylor Woodrow's profits were £54,000 and the firm was building estates throughout the home counties and southern England.
The company went public the following year with a capitalization of £400,000. Taylor, the managing director, then established a housing and apartment development company on Long Island, New York. Returning to London, Taylor purchased 100 acres of land along the Grand Union Canal and built new company headquarters; the offices were designed so that they could be converted into houses if extra funds were needed.
In 1937 the company entered the construction and civil engineering field through the formation of Taylor Woodrow Construction Limited. Although civilian business for the new subsidiary got off to a slow start, Taylor Woodrow received contracts, shortly before World War II, from the war office to build military installations. After war was declared, the company constructed gunnery camps, antitorpedo boat gun emplacements, land and sea defense works, hospitals, factories, caissons, and an aerodrome. When schedules were threatened because most of the workforce had been enlisted, Taylor hired laborers from Ireland, a technically neutral country. With workers and government contracts in plentiful supply, the company expanded dramatically. Among wartime acquisitions were the 1942 purchase of Greenham Plant Hire Co. and other firms involved in the supply of machinery and materials to the construction industry; these acquisitions formed the basis for subsidiaries that later were known as Greenham Trading and Greenham Construction Materials.
Postwar Overseas Expansion
After the war, many buildings had to be replaced and demobilization created a demand for new homes. In concert with other builders, Taylor Woodrow funded the research and design of Arcon, a prefabricated housing system. The Ministry of Works ordered 43,000 of these units.
In spite of the amount of work available in Britain, Taylor Woodrow had grown so large that it needed to expand overseas. In a joint venture with Unilever, the company extended operations into West Africa where it erected Arcon tubular steel frames to which walls of a variety of local materials could be added. In 1947, Taylor Woodrow (East Africa) was formed to build 127 miles of oil pipeline in Tanganyika. For three years, company teams constructed pipeline, erected a sawmill, and built prefabricated houses; but dissatisfied with the project's central management, Taylor Woodrow withdrew.
The West African, South African, American, and United Kingdom projects were more successful. In Africa, the company built entire towns, from housing to sewers and breweries; in the United States, the firm continued its apartment complexes; in Britain, Taylor Woodrow erected factories and added bridge and tunnel construction and opencast coal mining to its activities. In 1953 the company established Taylor Woodrow (Canada) Ltd. and also purchased a controlling interest in Monarch Mortgage and Investments Ltd., a property development firm that owned land, apartment complexes, stores, and houses in the Toronto area. Monarch also had its own construction company.
Also in the postwar era, Taylor Woodrow built several energy plants in England, including the Battersea Power Station and another near Castle Donington. It completed the world's first full-scale nuclear power station at Calder Hill in 1955. In conjunction with other companies, Taylor Woodrow also built the Hinkley, Sizewell, and Heysham nuclear power stations.
In 1964, having already entered the property investment field in Canada, Taylor Woodrow did the same at home with the formation of Taylor Woodrow Property Company Limited. This firm was charged with purchasing land for development, with the developed property, such as office buildings and industrial parks, to be held in ownership as rental properties.
The company received the prestigious Queen's Award for Industry in 1966 for its development of a new pile driver, the Pilemaster. The firm also designed the first spherical prestressed concrete pressure vessels, initially used for a power station at Wylfa. Among major construction projects undertaken during the 1960s were the Miraflores earth-filled dam in Colombia and the Hong Kong Ocean Terminal, which opened in March 1966. The latter included what at the time was the largest shopping center in Asia.
Steadily Successful in the 1970s and 1980s
The building slump in Britain during the 1970s did not create any serious problems for Taylor Woodrow since it was operating very successfully in developing countries, particularly in the Middle East. In Oman, Taylor Woodrow built the first modern hospital, the first television studio, and Medinat Qaboos, a new township located near Muscat that included more than 1,000 homes. The company also was very active in Dubai. There, Taylor Woodrow was involved in a massive development, a little more than three-quarters of a square mile in area, that included dry docks, ship repair shops, and harbor works. The new docks were opened for business in February 1979 by the queen of England.
Back home, Taylor Woodrow's most prominent endeavor was the beginning of work on a massive redevelopment of London's crumbling Dockland, located near the Tower of London. Called St. Katharine Docks, the massive development was located on 25 acres, ten of which were water, and was envisioned to include a multifunctional array of properties: a major hotel, restaurants, office buildings, residential housing, schools, and recreation facilities, including a yacht club and marina. Although Taylor Woodrow Property was awarded a contract for developing St. Katharine Docks in 1969, the actual construction of what eventually became a world famous redevelopment complex continued, through several phases, into the 21st century.
Profits rose steadily throughout the 1970s, reaching £24 million by 1979. That year, Frank Taylor resigned as managing director and became life president; already knighted, he was elevated to the peerage in 1982 and assumed the title Baron Taylor of Hadfield.
Taylor Woodrow's three-pronged array of operations&mdash′operty, housing, and construction--held it in good stead through the 1980s as profits peaked at £117 million in 1989. In the area of housing developments, the company was finding particular success in Canada and in Florida and California in the United States. Highlighting the construction sector was Taylor Woodrow's participation in the consortium that began building the Channel Tunnel in 1986. The engineering feat was completed in 1993. In 1988 Taylor Woodrow augmented its property portfolio through the purchase of 1.85 million square feet of commercial space and 58.5 acres of undeveloped land from the Warrington-Runcorn Development Corporation for £77.1 million. As the decade ended, Frank Gibb retired as chairman and chief executive of the company. Peter Drew, who had led the development of St. Katharine Docks, became chairman while Tony Palmer took over as chief executive.
Restructuring in the 1990s
The early 1990s brought a reversal of fortunes stemming from a severe downturn in the construction contracting sector, a deep recession in the U.K. housing market, and a collapse of U.K. commercial property prices. After the company posted losses in 1991, Drew retired as chairman in early 1992. Colin Parsons, who had headed the successful Canadian subsidiary Monarch Development, took over as chairman. Under the leadership of Parsons and Palmer, Taylor Woodrow managed a quick turnaround, returning to profitability in 1992. Substantial restructuring efforts included the merger of the U.K. and international construction divisions and the withdrawal from unprofitable general building work in the United Kingdom. About 2,000 employees were cut from the company payroll. On the strength of a booming North American housing market and an improving U.K. commercial property market, Taylor Woodrow enjoyed steadily rising turnover and profits through the mid-1990s, with sales reaching £1.29 billion (US$2.14 billion) and net income hitting £56.2 million (US$92.7 million) by 1997.
Executive turnover revisited the company in the late 1990s. In early 1997 John Castle became the first chief executive to come from outside the group. He left, however, after just six months because of reported 'incompatibilities.' Parsons took over on an interim basis, until Keith Egerton was named chief executive in November 1997, having previously headed Taylor Woodrow Property. The following summer Parsons retired from the company board and was replaced as chairman by Robert Hawley, a former chief executive of British Energy plc.
Parsons and Hawley initiated another round of restructuring at the company, having determined that the firm's future lay in housing and property. In 1999 the construction division was downsized into a 'focused provider of value added construction support.' The construction workforce was reduced by about 250. A further contraction of the construction operations came the following year when the company announced plans to exit from foundation engineering, precast concrete products, and most other civil engineering work. Next, Taylor Woodrow divested Greenham Construction Materials and Greenham Trading. Meantime, in May 2000, the company spent about C$206 million (£88.8 million) to acquire the shares of Monarch Development it did not already own. This move fit in with the company's strategy of building its core housing and property businesses worldwide. The purchase also enabled Taylor Woodrow to consolidate its North American operations into one management structure. Having completed an exit from heavy construction, Taylor Woodrow hoped that its upscale housing developments and its massive property investments, such as the 2000 proposal for a £100 million leisure and residential development in Gateshead called Baltic Quay, would insulate it from any recessions that might arise in the early 21st century.
Principal Subsidiaries: HOUSING: Taylor Woodrow Capital Developments Limited; Taywood Homes Limited; Taylor Woodrow (Australia) Pty. Limited; Taylor Woodrow Holdings Pty. Limited (Australia); Taylor Woodrow Holdings of Canada Limited; Monarch Construction Limited (Canada); Monarch Development Corporation (Canada); Taylor Woodrow Finance (Ireland); Taylor Woodrow Homes, Inc. (U.S.A.); Taylor Woodrow Homes Florida, Inc. (U.S.A.); Taylor Woodrow, Inc. (U.S.A.); Taylor Woodrow Investments, Inc. (U.S.A.); Monarch Holdings (USA), Inc.; Monarch Homes of Florida, Inc. (U.S.A.). PROPERTY DEVELOPMENT AND INVESTMENT: Taylor Woodrow Chippindale Properties Limited; Taylor Woodrow Developments Limited; Taylor Woodrow Property Company Limited; Clipper Investments Limited; Pennant Investments Limited; St. Katharine by the Tower Limited; Monarch Construction Limited (Canada); Monarch Development Corporation (Canada). CONSTRUCTION: Taylor Woodrow Construction Limited; Taylor Woodrow Projects (M) Sdn Bhd (Malaysia).
Principal Competitors: Barratt Developments PLC; Beazer Group plc; The Berkeley Group plc; Bryant Group plc; George Wimpey PLC; John Laing plc; Persimmon plc; Redrow Group plc; Wilson Bowden plc.
Further Reading:
Cheeseright, Paul, 'Profits Up at Taylor Woodrow,' Financial Times, March 10, 1989, p. 30.
Dickson, Tim, 'Tackling the Decline at Taylor Woodrow,' Financial Times, March 31, 1992, p. 23.
Jenkins, Alan, Built on Teamwork, London: Heinemann, 1980.
------, On Site, 1921--1971, London: Heinemann, 1971.
Source: International Directory of Company Histories, Vol. 38. St. James Press, 2001.
