THE debt-laden housebuilder Barratt Developments has hired Credit Suisse to look at ways of selling off 10,900 acres of its land portfolio to raise cash.

Well-placed City sources cautioned that the process was still at a very preliminary stage and no firm decision had been taken to sell the land. It is thought Barratt wants to gauge interest from potential buyers and see how much they would be prepared to pay before committing itself to disposing of the land.

Analysts believe that Barratt would want to raise between £100m and £200m to go ahead with a deal.

The portfolio represents all Barratt’s so-called “strategic” land, which does not yet have planning permission to build new homes.

Last month Barratt unveiled a 68% fall in annual profits, wrote down the value of its portfolio of land by £208.4m and cancelled its final dividend.

It was recently forced to renegotiate lending terms with banks on its £1.65 billion debt after its ill-fated top-of-the-market purchase of rival Wilson Bowden.

Texas Pacific, the private-equity group, is thought to be among the parties to express early interest in Barratt’s land portfolio.

Barratt declined to comment. Builders Crest Nicholson and Taylor Wimpey have also been trying to sell chunks of their long-term land holdings. Taylor Wimpey is seeking to renegotiate its £1.7 billion net debt, but the process is being stymied because the builder is still in the process of identifying the holders of its publicly traded bonds who own about a quarter of its debt.

Meanwhile, Crest has admitted that it is in danger of breaching its banking covenants before the end of the year.

The virtual shutdown in the mortgage and credit markets has brought the housebuilding sector to its knees over the past few months.

Alastair Stewart, analyst at Dresdner Kleinwort, said in a note published on September 29 after a tour of property markets in the Midlands and north England that the impression, especially in new-build apartments, was one of “carnage beyond even our most bearish expectations”.

“Prices of urban apartments appear to have fallen in many cases by 40%-50%, volumes have dried up to virtually zero, many developers have gone bust and land in many cases appears to be worthless,” he said.

Stewart added that Barratt had recently sent letters to property professionals throughout the Yorkshire region offering discounts of up to 43% on its homes on bulk deals of at least five units. The letters detailed 161 examples with before and after prices.

Jon Cruddas, a senior Labour MP, this weekend urged Gordon Brown to nationalise parts of the housebuilding industry, potentially saving thousands of jobs and preventing a shortage of affordable housing.

It would also help the government to hit its aim of building 3m new homes by 2020 – a target that looks unachievable following the market turmoil.

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