Mr Hedges, 49, was reported to be a contender for the job at the time and sources close to the company speculated that his resignation might be a result of that disappointment.
But 10 days ago, when the company reported its interim results, Mr Parsons told City analysts to expect rationalisation from the top down. In the months since his appointment he has made no secret of his plan to simplify management.
Mr Hedges is resigning from his jobs as both chairman of Taylor Woodrow Property and director of Taylor Woodrow plc at the end of the month. He was made a director of the property company in 1973, when he was only 30, and is credited with building up the international property business.
But, along with many other construction and property companies, Taylor Woodrow has recently reported profits sharply lower after hefty provisions to reflect dramatic falls in property and land values.
A provision of pounds 21m in the six months to 30 June pushed it to an interim pre-tax loss of pounds 16m and prompted the dividend to be cut from 1.86p to 0.5p. In 1991 a provision of pounds 46.5m caused the company to lose pounds 2.7m before tax.
The group plans to achieve a pounds 20m reduction in overheads by 1993 through cost cutting across the group.
Keith Egerton, who joined Taylor Woodrow from Costain last year, will run the property business from day to day.
A Taylor Woodrow spokesman was not aware whether Mr Hedges had another job lined up. The company statement merely said: 'Mr Hedges now wishes to be free to pursue other interests in management, property investment and industry.'
Mr Parsons said: 'Peter Hedges has made a very valuable contribution to Taylor Woodrow over the past 25 years. We are extremely sorry to lose his services and we wish him every possible success in the future.'