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The Dutch-owned contractor, which reported earlier this month that it had broken the 拢1bn-turnover barrier for the first time, said that HBG Property had spare capacity after the sale last August of nine commercial developments that netted it 拢150m.

HBG would develop up to eight sites through HBG Property as the company feels it has the capacity to handle developments totalling up to 拢250m in value in a year.

It has schemes worth 拢100m in its development pipeline for this financial year.

Richard Gregory, HBG鈥檚 chief executive, said: 鈥淲e鈥檙e now looking at buying prime sites in town centres, but like everyone else our hands will be in our pockets until we judge the values have hit the bottom. Once we reckon the time is right we will be able to invest in sites that will be worth [in total] anything up to 拢200-250m each year.鈥�

HBG Property has projects in the centres of Glasgow and Edinburgh as well as an Allies and Morrison-designed scheme in Leeds that has a development value of 拢200m over five years. It built or acquired more than 100,000m2 of property in 2006.

Our hands will be in our pockets until we judge the values have hit the bottom.

Richard Gregory, HBG

Rival contractor Kier is considering a similar strategy. John Dodds, its chief executive, said earlier this year: 鈥淭here are opportunities in the pipeline for the second half of the year.鈥�

He added that the market 鈥渕ay also provide us with acquisition opportunities at sensible prices鈥�, although he admitted that the commercial market was 鈥渢ougher than we have seen for some time鈥�.

Steve Lang, director of commercial research at property consultant Savills, said: 鈥淭his approach by HBG and Kier would be a good strategy so long as land prices do fall. The credit crunch has only been going for six months, so landowners in these areas might not be looking to do a firesale just yet.鈥�

According to Savills, residential land values fell 8.6% in the first three months of 2008 and could drop 20% by the end of the year.