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Ikea-owned modular builder in talks with multiple councils over deals
The modular housing firm owned by Swedish furniture giant Ikea is in talks with several councils over potential developments, Inside Housing can reveal.
In an interview with Inside Housing, Graeme Culliton, UK managing director at BoKlok, said the developer is in “decent dialogue” with two local authorities and has spoken to roughly 12 others.
Since entering the UK market in 2019 BoKlok, which is a joint venture between Ikea and Swedish construction giant Skanska, has already signed deals with Bristol, East Sussex and Worthing councils.
In addition to these sites, Mr Culliton said BoKlok has another three sites across the South of England that it is hoping to start this year, alongside other projects in various stages of planning.
BoKlok has also signed a 1,000-home joint venture with Vivid, as well as an agreement to build 750 homes with Abri, renamed after a merger between Yarlington and Radian.
Mr Culliton said BoKlok is “not necessarily” looking to partner with any other housing associations at the moment.
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He added: “We’re a small business so servicing lots of different conversations and lots of different relationships is really difficult.
“Also we want people that really understand the modular product that we’re providing and are working with us on it.
“The UK markets, and certainly the UK bank and financing areas, still ask a lot of questions and set a very high bar for modular and certainly timber-framed modular like we are.
“So to have partners that really understand that business and what we stand for is important to us and if we had too many of those I’d be worried that the message gets diluted.”
Since first being established in the 1990s, BoKlok has delivered over 14,000 homes across the Nordics, the majority of which are in Sweden.
Mr Culliton said BoKlok’s aim in the UK is currently “to have really happy customers and not to be too fixated by how big you can be”.
“We want to prove the business will work here in the UK really successfully with really happy customers. Once we’ve got to that point we’ll talk about how big it could be,” he added.
The developer’s first UK homes are set to complete in Bristol this year, with residents expected to move in from September.
Boklok has already sold 79 of the homes back to Bristol Council to be used as council housing.
Applications will be accepted for the first market sale homes on the Bristol scheme from Monday, with residents being chosen via a ballot process.
BoKlok offers flats ranging from one to three bedrooms, as well as one and two bedroom houses.
The houses are manufactured by the UK-based modular firm TopHat and the apartments are manufactured by a company called Harmet, based in Estonia.
Mr Culliton said BoKlok has signed five-year agreements with each of these manufacturers and currently has no plans to build its own factory in the UK.
He said BoKlok’s homes are “just to the right” of affordable housing costs and are designed to be affordable for a nurse and police officer buying a house together.
While modular is often promoted as a cheaper alternative to traditional building, Mr Culliton said BoKlok is not yet at the point where it can build houses at a cheaper rate.
He said he believes the firm is probably two years away from the point where it will benefit from economies of scale in order to drive down construction costs.
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