CPS aims to expand - Webb heads for Mowlem

Capita Property Services' next target is a £30m acquisition, said MD Steve Morris last week, adding that CPS has about 12 names in its sights.

CPS has a turnover of £45m, generating a pre-tax profit of £6m. Activities include project management, qs, architectural services, structural design, telecom mobile services, M&E design services and building surveying.

"We have now created a foundation for Capita Property Services and are looking to expand, largely by acquisition," said Morris.

"Our acquisitions will be bigger than in the past. A £30m-a-year business will be the next target. It will be a company in our existing operating areas."

Six QS businesses and four project management groups meet that requirement. A couple of civil, structural and M&E design services groups also fill the bill.

CPS's margins run at 5-7%. "We are the best fee margin delivery of consultancy services in the UK," said Morris. "That's because we are efficient and also because we try to be specific in targeting key clients."

Morris revealed that CPS is working on the launch of a new cost planning capability. "We want to be the best at cost planning," he said.

"Every QS does it, but it is a fragmented market and we're going to do it well. The property development market is where it's aimed at because if those players get their cost plan wrong they only see the error when the bids start to come in. Clients suddenly find that they have to despec the project.

"You see cases where the client has reckoned on a £100m scheme, but finds that bids come in at £110m. Hence our development of an innovative cost planner called Cap-It.

"My background is as a QS and I'm aware that the industry isn't very good at this. There simply isn't enough detailed attention paid to such a service. We're already in discussions with a number of clients who want a better cost planning capability.

"We're developing a regime that looks at everything. All constituent parts are analysed. Take temporary works: we measure it and impose definitions. Also, and more radically, we review the cost planning of engineering services. All too often this element is outsourced to the technical market and is not fully analysed."

Contractors will be brought in at an earlier stage, so that buildability improves. "We'll be asking them how they would build the project because this impacts on cost," said Morris, adding that the planner will audit the scheme as it evolves.

Capita Group, CPS's parent, has a turnover of £330m and produces profits of about £36m. Michael Webb has been appointed head of strategic development for Mowlem Defence Solutions, a partnership between Mowlem, its fm subsidiary Aqumen and BAE Systems (formerly British Aerospace).

A former Army pilot, Webb said: "I believe that my extensive military knowledge and managerial experience will help Mowlem Defence Solutions become a major force in prime contracting."

Webb was previously project sponsor at the Ministry of Defence where he was involved in the delivery of multi-million pound capital projects. Before that he was deputy commander of the 39 Infantry Parade.