20 MARCH 2016 – Restoration man Stephen Beech owner of Beech Holdings,started out by selling Vimto lollies to kids in the Davyhulme Junior School playground at the age of 7.
Loaned £5 by his dad, the youngster bought a big tub of them from a Makro in Eccles and flogged them for 6p, making a 3p profit per lolly.
Now 38, he is investing tens of millions in bringing empty unloved city centre buildings – the majority of which are listed – back to life.
With 75 employees, Beech Holdings is on course to hit the £39m turnover mark over the next 12 months.
The group owns £40m of residential housing stock in Greater Manchester and has a gross development pipeline of £100m.
Stephen is also on the brink of launching a brand new home for his staff – 60 Oxford Street in the heart of Manchester.
That will coincide the group’s latest development, 25 Cross Street, going to market – a building comprising 27 apartments for young professionals.
“The Beech story started in 2001 when I was 23,” said Stephen during a chat at the soon-to-be old Beech headquarters on Portland Street. “I bought a property, 174 Acomb Street in Rusholme, for £38,000, after saving up enough money from doing 60-hours a week in a call centre.
“Rusholme was very unloved but had potential. It was tough, but I eventually turned it into a high end four-bedroom house, and four international students moved in.
“I had a small pot of cash left to do it up, which is where the DNA of the business we still have today was born. I wanted to provide the house that my target market wanted to see, not what myself, my sister or mum wanted to see.
“It all became about clean, fresh, newly renovated property with laminate flooring, which sounds a bit B&Q now, but at the time was cutting edge. American fridge freezers, fully renovated (including good quality furniture), which myself and my sister did. It was also about it being highly insulated so it was cheaper to run.”
He added: “I still own 174 Acomb Street and use the same lawyer who did all the legal work on that house for all our properties.”
Stephen, who lives in Spinningfields, now owns 100 houses within walking distance of Acomb Street, which vary from one-bed homes for nurses working at the nearby hospital to 9-bed student properties.
“Over time I have built up that side of the business – Beech Properties – and gradually employed more builders, plasterers and workers so I could stand back and keep the business moving. But that took a lot of time and required a lot of innovative thinking.
“I was making good money on each house and would spend a lot on solar panels and air source heat pumps for instance.
“But I was paranoid that my way of doing it would get stolen, because I had a USP. But no one could compete with what I was doing.
“With the student homes, I was also a pioneer in ‘all bills included’ which stopped students sitting round a table dividing up all the household bills. I also found out that no one was prepared to make that level of investment in a rundown area like Rusholme.”
In 2013 Beech Holdings was born and Beech Properties moved to sit alongside it within the group umbrella, as did Beech Construction.
“Beech Properties is the best run portfolio of its class in the country,” said Stephen. “I’ve not lost £1 of rent in six years because it is run so well due mainly to the calibre of tenants I attract.
“My properties were essentially carbon neutral at that stage. The Energy Efficiency Awards even contacted us and put us up against John Lewis and Costa Coffee. We ended up winning with 76 Burleigh Street, just off Oxford Road.
“It was officially the most energy efficient house in the country. It was A-rated and was our most famous house. Prince Charles heard about it and wrote me a congratulations letter which was a massive boost to me.
“The bank manager liked it as well and lent me lots more money which allowed me to bring even more houses back to their former glory and please the local community at the same time.”
He added: “All that money made on those days though, has been getting reinvested into Beech Holdings, due to the way the business is now setup.
“We’ve always been different and aim to be completely carbon neutral and are also very eco-friendly.”
Beech is more than student homes and the group owns much bigger buildings – 15 of them spread around Manchester city centre.
“The majority of them are all old unloved buildings which are empty,” Stephen added.
“One strong example is a listed building, 2 Waterloo Street, which is just off Princess Street.
“I bought it directly from a family. The four upper floors above an accountants’ office had lay empty for almost 70 years. When you go in you can literally see the last people who have walked there.
“There are dents from workmen’s steel clogs – they’d obviously chipped away at the floor years back while at work. It’s fascinating. I wouldn’t be surprised if we saw the ghost of a former worker in there. It’s pretty much 70 years of dust.”
Beech has submitted a full detailed planning application with the support of Manchester council and is hoping to be on site in the summer, converting it into apartments.
Stephen said the springboard moment for Beech Holdings in the city centre, however, was 90 Princess Street.
“I bought it because it pretty much resembled a large terrace house,” he said, laughing. “It was in fact an old factory – solid walls, slate tiled roof and joisted wooden floorboards.
“After talking to head of city centre planning Tony Mitchell at Manchester and my solicitor Tony Hardy, I decided to buy 90 Princess Street completely speculatively, and put in a planning application for 35 carbon neutral apartments.
“It turned into a big success and it is now on target to be the highest BREEAM rated mixed use building in the country.”
Stephen purchased the building for £1m and spent around £1.8m on it. It’s now valued at £6m after becoming fully occupied around 18 months ago.
He ventured into the city centre to focus more on providing apartments for young entry level professionals because around 200 tenants a year were leaving his properties in Rusholme as they were no longer students but professionals.
“These people were trainee doctors, nurses, bank managers and I knew them personally. And they were leaving me because they became professionals and had got themselves entry level salaries,” he said.
He added: “I knew a while ago that students of all three Manchester universities weren’t leaving the city. There’s a 58% retention rate and that isn’t going anywhere any time soon.
“So that’s why the business is modelled like it is today. I felt we had to move to the city centre to expand and grow.”
Stephen thinks the floodgates will open for Beech, particularly after the success of 90 Princess Street and the current projects that are all going through the pipelines – many starting to come through the other side as carbon neutral properties.
“There are many more buildings that I want to get my hands on, with the support of Manchester council and my partners and the banks,” he said.
“HS2 is on its way, Manchester is booming, but where are all the people who move here going to live?”
He added: “In Manchester there are a lot of old buildings that need to be brought back. The demand exists – tenants are screaming at me as there simply is not the stock. Any of the agents in Manchester will tell you that too.
“But I’ll say it again, this needs to happen now, not in 10 years’ time, not even tomorrow – now.”
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