Nexity, the leading French real estate developer, will put in place an employment protection plan (PSE) in 2024 to deal with the historic crisis in its core business, new real estate.
“The group has decided to initiate in the coming weeks the information-consultation process of the IRPs (staff representative bodies, editor's note), prior to the implementation of a job protection plan”, indicates in a press release Nexity, which has not yet defined how many jobs would be affected.
“We are going to adapt our business and our costs,” CEO Véronique Bédague told the press, adding: “If we want to produce affordable housing, we have to reduce costs.”
A difficult year for the group
In 2023, the group experienced a difficult year, suffering from a halt in new construction, caused by rising construction costs and difficulties in accessing credit for buyers.
Its accommodation reservations have eroded by 19% in number and 24% in value, even if, underlines Nexity, this is better than the entire French market which fell by 26% in number.
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Its turnover, down 9% to 4.27 billion euros, is slightly below its target of 4.3 billion, revised downwards in the middle of the year.
The group is also refusing to pay a dividend to its shareholders, although until now it had wanted to offer them a payment of at least 2.50 euros per share.
The group wants to sell its services branch
To compensate for this year, which it describes as a "low point", and to control its debt, the group has sold its Portuguese and Polish subsidiaries, and above all wants to offload its services branch.
It announced at the end of 2023 that it had entered into exclusive negotiations with the investment company Bridgepoint to sell it its property administration branch (trustee and rental management), valued at 440 million euros and which employs some 3,100 people, i.e. more than a third of its workforce.
And it is still looking for buyers for its corporate real estate management and distribution activities.
Nexity has reduced its net debt from 820 to 776 million euros and has set itself the objective of bringing it below 500 million at the end of 2025. The group is not setting other quantified objectives for 2024, waiting to see the evolution of interest rates and public policies, and hoping for “a rebound in 2025”.
A “deep transformation”
“At this stage, we remain quite conservative,” explained Véronique Bédague.
“There may be some improvement, but no one knows when rates will fall, and to what extent.”
In addition to the social plan, she promised an “in-depth transformation of the organization of Nexity and the company”.
The group will strongly decentralize its organization, to “be able to imagine the best mix of products at each location in the territory,” declared the CEO.
It also intends to accelerate its development in “urban regeneration”, that is to say the transformation of already built spaces, to anticipate the legal imperatives of “zero net artificialization”.