After a difficult 2020, when high profile construction projects were shut down for a time by Covid restrictions, the building industry seemed to rebounded strongly in 2021 - but with a few high-profile casualties.
Compared to the early days of Covid-19 restrictions, 2021 has felt more like a pre-pandemic year. But there has been a worrying trend in insolvencies in the industry, with some big names collapsing under the strain.
A construction industry trends report, by global insurance company Atradius, said commercial construction activity was hampered in 2021 by low demand for shops and offices, but growth was provided by house building and large public infrastructure projects.
On the downside, the same report mentioned the shortage of materials and inflation squeezing profit margins, fuelling fears of further insolvencies during 2022.
Atradius predicted 海角视频 construction industry insolvencies could increase by as much as 25% during the first half of 2022, and rated its outlook for the industry as “poor”.
Here are some big name firms that have collapsed since 2021
Crossfield Living and Crossfield Construction
Liverpool-based Crossfield Living entered liquidation in July 2022 owing more than £3.6m to its creditors just weeks after its sister company also collapsed.
The business was established in 2017 as a sister company to Crossfield Construction. Both companies were part of Crossfield Group.
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It was revealed in April that Crossfield Construction was set to be dissolved having racked up debts of £5.9m.
Jason Greenhalgh and Paul Stanley of Begbies Traynor, appointed joint liquidators of Crossfield Living, said Crossfield Living ceased to trade on April 29 after it "faced significant financial pressure.
It added that "Covid restrictions, the soaring price of raw materials and the loss of key contracts were some of the key factors in its demise".
Midas
The South West construction firm confirmed it had gone into administration on Tuesday, February 8 with the loss of 303 jobs.
The move comes a week after it posted notice of its intention to appoint an administrator after recording its first loss in its 40-year history in 2021.
Work on several construction sites around the South West ceased with immediate effect and, with the exception of a small number of people retained to assist the administrators, the group’s remaining 303 employees have been made redundant.
Steve Hindley, group chairman, put the blame on disruption and supply chain price hikes caused by the Covid pandemic, which, he said, caused contracts to be delayed or scrapped.
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He said: “The disruption and supply chain inflation caused by the Covid-19 pandemic resulted in a number of critical contracts being postponed or cancelled.
“The resultant impact on the group’s working capital led to severe liquidity pressure and meant the group was no longer able to operate.”
Richard Hawes and Matt Smith, both senior managing Directors at global business advisory firm Teneo Financial Advisory Ltd have been appointed as joint administrators to Midas Group Limited and its subsidiaries: Midas Construction Ltd, Midas Retail Ltd, Mi-Space (海角视频) Ltd, Mi-Space Property Services Ltd, Midas Commercial Developments Ltd and Falmouth Developments Ltd.
It has been announced that Bell Group had swooped to purchase Mi-space (海角视频) Ltd, the property services division which is part of the Midas Group.
Beaumont Morgan Developments
The developer behind a 900-home scheme in Salford Quays entered administration in January.
Begbies Traynor was appointed as administrator to Beaumont Morgan Developments, according to documents filed with Companies House.
The firm is the construction arm of Fortis Group and is based at Lancastrian Office Centre on Talbot Road in Stretford.
Begbies Traynor partners Stephen Katz and Asher Miller are to lead the administration process, according to Companies House.
The firm's latest financial accounts, for the 12 months to March 27, 2020, show it reported a turnover of £47.1m, up from £40.2m, and a pre-tax profit of £64,400 after posting a loss of £72,165 during the prior 12 months.
According to those documents, the business employed 61 people during that financial year.
Kapex Construction
The Newcastle construction company collapsed in August owing more than £4.5m to creditors.
FRP Advisory’s Steven Ross and Allan Kelly were appointed as joint administrators of Kapex Construction in August, several weeks after the company had called in advisors.
The company, formed in 2016, was the contracting arm of The Morton Group, which specialises in land acquisition, property development and construction.
An administrator’s proposals document filed at Companies House in October stats that as the firm has ceased trading, the objective is to realise property to make a distribution to one or more secured or preferential creditors.
The document also lists more than 260 company creditors, including many North East supply chain firms, which are collectively owed £4,547,474.
Yet, administrators estimate the figure could be closer to £6.8m following correspondence from finance company Mysing.
Countesswells Development
Construction company in November.
Owned by Stewart Milne Group, it oversees the development of land at the new Countesswells community located to the West of Aberdeen.
Ultimately intended to extend to 3,100 homes over 400 acres, Countesswells is a community of private residential developments, affordable homes, schools, retail, commercial and leisure facilities.
Around 900 affordable and private properties and several commercial properties and community facilities have been built, or are under construction, by a variety of residential, commercial and public sector operators.
Work started in October on a £17m primary school and nursery, due for completion in 2023.
Tom MacLennan, joint administrator and partner with FRP, said at the time: “Our immediate priority will be to secure the site and finalise current construction, including completion of much-needed affordable housing projects.
“We will be reviewing the various land bank assets in line with the development plans and will work closely with the various stakeholders on the future development of the site.”
PDR Construction
Administrators were appointed to Hull-based PDR Construction Ltd in January.
Philip Deyes, Sean Williams and Andrew Poxon, of Leonard Curtis Business Rescue & Recovery said all operations ceased and all staff were made redundant prior to their appointment.
A “significant lost adjudication” in a contractual dispute has also been highlighted at the Hessle firm, which walked away from 14 sites with ongoing work valued at £90 million.
The company experienced challenging market conditions impacting the delivery of a number of recent projects, resource issues as a result of the Covid-19 pandemic, and contractual disputes with private clients including a recent significant lost adjudication.
The company fell behind with payments to its creditors and .sub-contractor supply chain, culminating in a winding up petition being served on the company on January 4.’
The trio from the Leeds office of the national business solutions group are now looking to sell PDR’s construction contracts ledger of active and completed sites.
PDR, launched by Paul Dransfield in 1993, was active nationwide, but had delivered several schemes for city developer Wykeland. It turned over £83 million in the year to April 20, 2020, reporting a first loss in a decade as a £373,011 profit in 2019 turned into a £351,853 loss.
Henry W Pollard and Sons Ltd
The South West construction firm went into liquidation in 2021 leaving buildings unfinished has also left debts of more than £10million.
Henry W Pollard and Sons Ltd, which had been in business for 161 years, ceased trading in June 2021, leaving buildings such as Plymouth’s £13m Teesra House apartment block in limbo.
Joint liquidators at South West accountancy and business consultancy Bishop Fleming LLP revealed in August that more than 300 creditors have made claims totalling £10,093,692 against the firm’s assets.
Fortunately, work was restarted at the building, at the Mount Wise estate, two months after Pollard’s collapse, when family-run Brady Construction Services, which has offices at the Millfields in Plymouth, took over.
URBN Construction Ltd
The Plymouth-based firm left debts of more than £2.5m when it went into liquidation in May 2021.
Documents filed at Companies House in October revealed 182 claims have been made for cash, most of them from other firms in the construction industry.
URBN Construction left just £44,400 in assets, but was faced with claims totalling more than £2.5m for money owed. Even the taxman, HM Revenue and Customs, will not receive the full £345,687 it is due, despite being a preferential creditor. And 20 former employees are unlikely to see any of the £65,262 that is owed to them.
WRW Construction
What was one of Wales’ leading construction firms went into administration in July 2021 after coming under “significant financial stress.”
As well as its Llanelli HQ the family-run and owned business had offices in Cardiff and Bristol with more than 100 staff made redundant.
It was revealed in September that the firm owed creditors nearly £30m with the biggest single creditor alternative lender Thincats, which was owed £10m.
Having initially provided a multi-million pound funding line in 2019 to support WRW’s expansion plans across South Wales and the west of England - secured against company assets including property and plant and machinery - in June 2020 Thincats provided a further £5.1m through the Coronavirus Business Interruption Loan Scheme (CBILS).
One of the 海角视频 Government’s flagship responses to support firms impacted by the pandemic, the now closed CBILS provided a 80% government guarantee to its accredited lenders, like Thincats, in the case of default.
The joint administrators are Alistair Wardell and Richard Lewis of Grant Thornton.
Ebor Concretes
The North Yorkshire construction firm called in administrators in November 2021 after falling into financial difficulty in 2019.
It has since been announced that a buyer has been found, saving 26 jobs.
Administrators - Leeds-based Armstrong Watson’s restructuring and insolvency partners Rob Adamson and Mike Kienlen - secured an accelerated sale to Nottinghamshire operator JP Concrete Products Ltd.
The pre-cast specialist now aims to breathe new life into the business, drawing on its operations across construction and agricultural markets for the last 15 years.
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