Mears Lands £700m Housing Deals as Order Book Hits Record £4bn Peak

Michael Ghobrial
20 hours ago
5 min read

Mears Group has secured two major long-term housing maintenance contracts worth a combined £700m, pushing its order book to a record £4bn and cementing its position as one of the UK's leading social housing services businesses. A £450m, 10-year deal with Birmingham City Council and a £250m, 10-year contract with Cross Keys Homes in Peterborough signal a sustained demand for compliant, professionally managed housing maintenance as regulatory pressure and building safety obligations on social landlords intensify.

Project Overview

Client 1: Birmingham City Council, £450m over 10 years for housing maintenance services.
Client 2: Cross Keys Homes, Peterborough, £250m over 10 years for housing maintenance services.
Combined value: £700m across two long-term contracts.
Contractor: Mears Group.
Order book: Record £4bn, up from £2.9bn a year ago.
Group revenue: £1.14bn in the year to December 2025.
Maintenance revenue: £620m, up 12%, now 55% of total turnover.
Adjusted operating margin: 5.7%, up year on year despite rising costs.
Strategic direction: Sharpened focus on housing services following the sale of the facilities management arm for £18m.

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Delivery Partners and Key Stakeholders

Main contractor: Mears Group is the appointed housing services provider across both contracts, responsible for planned and reactive maintenance, compliance works and building safety delivery.
Client 1: Birmingham City Council, the UK's largest local authority housing landlord, has appointed Mears on a 10-year, £450m contract to maintain its substantial social housing stock.
Client 2: Cross Keys Homes, Peterborough's leading housing association, has awarded Mears a 10-year, £250m contract for housing maintenance and compliance services.
Compliance growth: Mears has strengthened its building safety and housing standards offer through the acquisition of Pennington Choices, directly targeting growth driven by tougher regulatory requirements on landlords.
Regulatory context: The Social Housing Regulation Act, building safety legislation and Awaab's Law are all creating sustained demand for specialist, compliant maintenance providers, underpinning the contracts' long-term value.
End users: Thousands of social housing tenants in Birmingham and Peterborough, who will benefit from improved responsiveness, safety compliance and property standards across their homes.

Construction and Technical Details

Mears' core offering across both contracts is planned and reactive maintenance covering a full range of housing services: repairs, electrical and gas compliance, fire safety, damp and mould remediation, energy-efficiency upgrades and decarbonisation works. The Birmingham contract, given the scale of the city council's housing portfolio, will be one of the largest single social housing maintenance programmes in operation in the UK.

The Cross Keys Homes contract in Peterborough covers a more geographically concentrated but operationally complex stock, where Mears will need to demonstrate responsiveness, tenant communication and regulatory compliance across a mixed housing estate profile. Both contracts will be managed under Mears' established systems for digital job management, tenant satisfaction tracking and performance reporting.

The acquisition of Pennington Choices is particularly relevant here. Tighter building safety regulation, following the Building Safety Act and strengthened Social Housing Regulation Act enforcement, means landlords need maintenance contractors who can also provide compliance advisory services, fire risk assessment, damp and mould auditing and safety case support. Adding this capability directly into the Mears offer makes the business more competitive in bids and more embedded in long-term client relationships.

Labour cost pressures remain a challenge, with Mears absorbing a £5m hit from higher employer National Insurance contributions in 2025. Managing this while growing margins points to disciplined overhead control, smarter job scheduling and technology-driven efficiency, areas where scale and long-term contracts provide a meaningful competitive advantage over smaller regional maintenance firms.

Timeline

Mears reported its full-year results for the 12 months to December 2025 in March 2026, revealing both new contract wins and the record order book figure. The Birmingham City Council and Cross Keys Homes contracts were confirmed as part of the results announcement, with both running for 10 years from their respective start dates.

Looking forward, management has guided for 5 to 9 per cent annual growth in maintenance activity, driven by long-term contract momentum and regulatory-driven spending on housing upgrades. The disposal of the facilities management arm for £18m, completed as part of a deliberate portfolio sharpening, clears the decks for Mears to deepen its housing services focus across the public and social housing sectors for the remainder of the decade.

Strategic Importance

The twin contract wins are strategically significant because they reflect two of the most pressing forces reshaping the UK social housing maintenance market. First, large local authority landlords like Birmingham City Council are under mounting pressure to demonstrate compliant, properly managed maintenance programmes following high-profile regulatory interventions and Housing Ombudsman findings. Second, housing associations like Cross Keys are facing rising tenant expectations and tightening Regulator of Social Housing standards that demand more from their maintenance partners.

For Mears, building a £4bn order book on the back of these dynamics is a vindication of its decision to exit management-heavy asylum housing and pivot back to core maintenance work. Revenue from management-led activity has fallen 11 per cent as asylum housing volumes normalise, but the gap is being filled by higher-margin, more predictable maintenance contracts that offer visibility for years ahead.

At an industry level, the results signal that the social housing maintenance and compliance sector is in a period of significant consolidation and professionalisation. Firms that can combine scale, technology, compliance depth and financial resilience are winning disproportionately large and long-tenured contracts, while smaller operators without these capabilities are finding it harder to compete on regulated, high-accountability programmes.

Writer's Opinion

The Mears results are a useful case study in how regulatory pressure creates commercial opportunity for the right kind of business. Building safety legislation, the Social Housing Regulation Act and Awaab's Law have all raised the stakes for social landlords who fail to maintain their stock properly. That pressure does not go away, which means well-structured, long-term maintenance contracts with credible providers like Mears become a risk-management tool for councils and housing associations as much as a service delivery mechanism.

The acquisition of Pennington Choices is a sharper strategic move than it might first appear. Compliance advisory, fire risk and safety case support are not glamorous, but they are increasingly sticky services that deepen client relationships and create barriers to switching. A maintenance contractor that can also tell a client whether their buildings are legally compliant and what needs to happen next is more embedded and more valuable than one that only fixes what it is told to fix.

For Emilecon readers, the broader lesson is about the relationship between regulation and pipeline. As building safety, decarbonisation and tenant welfare requirements continue to tighten across the social housing sector, the volume of maintenance, compliance and retrofit work is not going to shrink. The question is which firms are positioned to capture it at scale, with the technology, workforce and advisory capability to win and retain major long-term contracts in an increasingly scrutinised market.

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