S Annual Report and Accounts 2019 Annual Report and Accounts 2019 Our purpose We work at scale and with partners who value quality, to create beautiful, sustainable and community focused places where housebuilders want to build and people want to live. Our values Quality Integrity Passion Partnership Innovation Read more in our Chairman’s statement page 14 Our vision As the leading Master Developer of large scale strategic sites, we strive to be proud of the sustainable communities we are crafting, the quality of place making we are delivering and the challenges that we are overcoming through shared innovation and passion. We believe that doing things right means creating value for shareholders and for our wider stakeholders. We are committed to keeping our promises, maximising our investment and delivering across an increasing range of sites. Read more in our CEO’s statement page 16 S Strategic report Our sustainability 4 At a glance capitals 6 Master Developer 8 Our business model 10 Strategy Physical 12 Key performance indicators 14 Chairman’s statement 16 Chief Executive’s statement Human Social 24 Financial review 33 Long-term viability statement 34 Risk review 44 Operating review 48 Sustainability Natural Economic G Governance 66 Corporate governance review Read more in our sustainability report 68 Board of Directors on page 48 70 Corporate governance report 88 Nomination and Governance Committee report Master Developer 99 Audit Committee report 106 Directors’ Remuneration report differential 108 Introduction 114 Directors’ remuneration policy report Through our new and interactive website 118 Annual report on remuneration we have sought to answer some of the 126 Directors’ report most frequent questions about the 129 Directors’ responsibility statement Master Developer differential: Why a Master F Financial statements Developer is needed? 132 Independent auditor’s report to the members of Urban&Civic plc What makes a 138 Consolidated statement of Master Developer? comprehensive income 139 Consolidated balance sheet How a Master Developer 140 Consolidated statement of changes in equity adds value? 141 Consolidated cash flow statement 142 Notes to the consolidated Who does a Master financial statements Developer work with? 172 Company balance sheet From our earliest 173 Company statement of changes in equity 174 Notes to the Company days, Urban&Civic Experience our new website financial statements has always sought www.urbanandcivic.com 179 Glossary of terms to do things right. 181 Shareholder information www.urbanandcivic.com Cover image: One of the network of ecology corridors which run through Houlton, Rugby. These corridors not only provide excellent habitat for protected species but also contain pathways, benches, ecological information and extensive green infrastructure for everyone to enjoy. 1 Strategic report Nature pathway through Key Phase 1 Alconbury Weald AT A GLANCE Our business at a glance Who we are What we do We are now the UK’s leading Master Developer having At the core of our business are the nine strategic sites been specifically created ten years ago to disrupt the where we are currently bringing forward, either directly or established approach to the promotion and delivery of in partnership, over 8,949 acres of land predominantly large scale residential-led strategic sites. Our highly within 100 miles of London. As Master Developer, we take scalable team brings together the significant expertise responsibility for obtaining planning and delivering the and experience necessary to accelerate the delivery of sustainable green, grey and community infrastructure to high quality and sustainable new communities including establish high quality places within which we market fully financing, land assembly, planning, project management, serviced land parcels to housebuilders. We also ensure development and estate management. We also have smaller that the scale and longevity of our investment benefits local dedicated teams focusing on shorter-term commercial communities through opportunities, partnerships, jobs and developments and smaller scale land promotion. training. Our commercial developments and smaller scale land promotion are respectively delivering investments in strong markets and housing in locations of proven need. Read more in the Company’s business model Read more on our Master Developer product page 8 page 6 Who we work with Shareholders Employees Government Customers & regulators Working in partnership with a wide variety of stakeholders Board is at the heart of successfully delivering strategic sites. Our customers are the increasingly diverse housebuilder market and we have partnerships with landowners who share our aspirations for legacy quality, long term developer Local Suppliers & communities relationships with planning and highway authorities and contractors strong bonds of community with local people and groups. Partners These stakeholder relationships are detailed throughout this report and we take pride in being a trusted partner at all levels. Read more in our governance report pages 80 and 81 4 Urban&Civic plc — Annual Report and Accounts 2019 S Our portfolio Portfolio value by segment Liverpool Manchester 11% Middlebeck 4% Nottingham Priors Hall Birmingham King’s Lynn Alconbury Norwich Weald RadioStation Rugby Wintringham Waterbeach Milton Keynes Cambridge 85% Ipswich Tyttenhanger Calvert Luton Bath Oxford Tyttenhanger London Reading Manydown Strategic sites Dover Bournemouth 85+11+4+M Brighton Commercial 50 miles Catesby 100 miles Strategic sites Commercial Our strategic sites are almost all within 100 miles of London, in key Our commercial sites comprise a number of bespoke growth locations with strong transport links and with delivery and city centre developments targeting de-risked returns achieved over ten to twenty years per site. shorter-term returns. No. of sites Homes consented and submitted No. of sites Total square footage 9 33,500 6 797,000 Catesby Our Catesby business focuses on smaller scale land promotion achieving predominantly planning uplift based returns. No. of sites Total acres Calvert Tyttenhanger 65 2,147 Buckinghamshire South Hertfordshire Read more in our operating review pages 44 and 45 Read more in our operating review pages 46 and 47 Annual Report and Accounts 2019 — Urban&Civic plc 5 MASTER DEVELOPER Master Developer product What is a serviced land parcel? Urban&Civic convert large blocks of unconsented raw land for The predominance of our serviced land contracts established a low which there is an extremely limited market into oven ready parcels upfront capital option for housebuilders whilst allowing Urban&Civic of fully serviced land for which there is both a mature and to share in the proceeds of every home sold as well as guaranteeing growing market. us an established forward income stream. This structure is attractive to all sizes of house builder as well as new types of housing delivery We de-risk land acquisition and planning, deliver a highly sustainable vehicles entering the market. green and grey infrastructure framework, take responsibility for community facilities, community relationships and place making All housebuilders on Urban&Civic serviced parcels also benefit and thereby create a serviced land product in prime locations from highly professional and impartial site management and which allows housebuilders to do what they do best but even security, established and innovative jobs and skills programmes, better and faster. meaningful community engagement opportunities, site wide marketing and a consistent and repeatable contractual offer across all Urban&Civic sites. Master Developer: Raw land Planning Delivery Large blocks of land acquired Application of a flexible and Green infrastructure directly or through partnerships innovative planning structure Early delivery of a significant and sustainable green Consultation infrastructure framework t rpla n aste nnin e M g F m e e e n d f b e a R c Design k 1,425 Application ACRES OF RAW LAND Adding value at every stage Land £ ££ In summary: 1. Urban&Civic create the serviced land parcels... 6 Urban&Civic plc — Annual Report and Accounts 2019 S What the Master Developer delivers on and off a serviced land parcel: Off Parcel On Parcel • Site wide quality • Established green infrastructure • Site wide place making and marketing Consistent Full utility Design code • Discharge of site wide S.106 obligations contractual terms provision • Design and project management assistance • Established planning framework Oven ready Health & safety • Jobs and skills programmes land quality framework • Further serviced parcels available • De-risked and ready to go Master Developer: Housebuilders & businesses: Delivery Serviced land Grey infrastructure Community infrastructure Housebuilders add the Creation of pipes, wires, roads, Establishing quality via the homes, businesses add the cycle lanes and pathways delivery of community facilities commercial spaces 15 ACRE SERVICED LAND PARCEL £££ ££££ Cash 2. ...our customers add the homes 3. ...and their customers and employees help and commercial spaces... create the community. Annual Report and Accounts 2019 — Urban&Civic plc 7 OUR BUSINESS MODEL U&C business model Over the last ten years we have established a highly professional and scalable business model to become the market leader in taking large scale blocks of raw land and transforming them into high quality, sustainable neighbourhoods and communities within which a wide range of housebuilders