Staff at property consultancy Savills have celebrated a £70 million windfall after profits smashed expectations in 2004.
Bonuses and commissions worth more than £250,000 were paid to 40 agents following a year in which the London-based firm with an office in Solihull saw pre-tax profits jump from £34.1 million to £50.2 million.
The payments followed the strong commercial property market in which the hunger for UK sites showed no sign of slowing. Turnover was nine per cent higher at £328 million in the year to December 31.
Savills sells office blocks, retail parks, warehouses, hotels and care homes in addition to a residential sales department where houses carry a typical price tag of more than £1 million.
While staff received an average payout of £30,000, investors also cheered a 36 per cent rise in the annual dividend and an additional 20p a share following the final sale of sites held in its property trading and investment division.
Chairman Peter Smith said: "The continuing buoyancy of the global investment markets is encouraging for the prospects in all parts of our commercial business in 2005.
"We have enjoyed a satisfactory start to the year and are confident that the company will continue to perform well."
Savills also said its residential sales were proving "resilient" to rising interest rates compared to the slowdown in the mainstream market.
The group sold 2,600 homes during the year with a total value of £2.6 billion, including the sale of eight houses in excess of £10 million in London and the most expensive home sold in rural Hertfordshire at a guide price of £5.5 million.
Chief executive Aubrey Adams said 2,000 staff in the UK were eligible for the windfall as well as some agents in Europe and Asia, which are its other key markets.
Prices of prime property are expected to rise by four to five per cent this year and should outstrip the rate of growth in the mainstream market, reversing a trend of the past few years, he added.
"Property is seen to be a relatively safe asset and investors are still looking at pretty good returns over the next few years."
Analysts are expecting the group to grow earnings by about five per cent this year on an underlying basis.
Its Birmingham office sealed some landmark deals and new instructions as their business expanded throughout 2004, according to Richard Franklin, head of Savills Residential & Development in the city.
"Birmingham continues to hit the headlines as a buoyant and vibrant city at the forefront of change and development, and to attract investors from around the UK and abroad," he said.
"Property development is evident in many parts of the city with huge areas of regeneration poised to get underway including the Eastside, which will have a major impact on the cityscape of Birmingham."
It expects to see growth in the development and new homes departments.
"The development team disposed of over £60 million of residential land equating to over 1,500 units across the Greater West Midlands," he said of last year's performance.
"Exciting new homes projects are on the horizon with more niche products expanding the range of properties coming to the market. New hot spots are emerging on the fringes on the city and beyond as development ripples out to other areas and 2005 gathers renewed confidence."
