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TopHat has opened a consultation with its staff as it plans to make around 70 redundancies to cut costs.

The modular developer, which posted a 拢20.4m pre-tax loss for the year to 31 October 2022, has plans to increase its capacity to 4,500 homes.

It intends to open a second factory, a 650,000 sq ft facility in Corby. Northamptonshire, this year in addition to its one at Derby.

But a spokesperson confirmed the developer is now consulting with staff 鈥渁s part of a programme to reduce the costs of the business in response to the prevailing challenging market鈥�. According to its last set of results the firm had 212 employees.

The spokesperson added: 鈥淭he changes are a prudent step to ensure the business maintains current delivery levels during 2024 and is well positioned for growth as the market returns.

鈥淭he medium and long-term need for volumetric modular homes is becoming ever clearer as traditional build capacity is constrained by the growing skills shortage. While cost cutting is always tough, these changes will put TopHat in pole position for growth when demand rebounds.鈥�

>>See also: L&G Modular鈥檚 closure shows there鈥檚 a limit to the patience of slow capital

>>See also: What went wrong for Ilke Homes?

The company, which has yet to be profitable, posted turnover of 拢10.2m for the year to 31 October 2022. This was down on the 拢12.3m the previous year with its pre-tax loss increasing around 5% from the 拢19.5m posted the previous year.

Last year, TopHat raised 拢70m from investors including Aviva Capital Partners and Persimmon. The firm is majority owned by investment bank Goldman Sachs.