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Last year HLM Architects' ambitious plan to hit the stock market fell through, but chairman Chris Liddle is still convinced that he can beat the profession's 'financial dyslexia' and show how profitable architecture can be

Some things in life are unfathomable, and why architects have had such a dismal history of failing to turn hard work and inspiration into valuable business is just one of them. While seven years' of training and impovrishment can mean riches for lawyers, it is just a warm-up for life on the breadline for many architects.

One architect determined to avoid the pattern was Chris Liddle, the 50-year-old chairman of PFI-specialist HLM Architects.

A year ago Liddle looked to have found his route to riches and the details of an ingenious deal to make him and his colleagues paper millionaires were splashed across the pages of The Times as well as The Architects' Journal (AJ 13.4.00).

He and his fellow directors were plotting a reverse takeover of listed advertising agency Osprey Communications. The deal would create a new £25 million company, and would make each of the practice's bosses £4 million richer. Crucially, the 150 salaried staff would have the chance to own a slice of the business and the directors would have solved a common conundrum for maturing architects - the exit strategy. A few years down the line the new company structure would allow the directors to retain ownership while handing the running of the business over to the next generation.

Casting a shadow over the deal, however, was the fact that architectural practices have had more failure than success in listing on the stock market - only a handful remain in public ownership. Liddle, the energetic and enthusiastic chairman, struggled to persuade hard-nosed investors that this would not be another failed architecture floatation. In the end the deal collapsed and the company, which was to be called Rock Archimedia Design after Liddle's passion for his band 'Sweeping up after Eric', never emerged.

Fast forward to February 2001 and an unbowed Liddle is relaxing in a restaurant in London's Waterloo wearing a comfy pair of Diesel jeans and gripping last year's deal prospectus - the dream which never came true.

As he runs through the patter which he gave time after time to institutional investors it seems he still believes that the logic of his business case was not the deal's downfall and the City-speak comes thick and fast. There were to be 'interesting synergies' between the management of the two design-based companies, 'two plus two would make five'. 'Business ethos', 'total branding' and 'cross selling' were all part of the plan. Cutting through the babble, this meant the architects would design, for example, a PFI-hospital, and then Osprey's services such as signage, visitor leaflets, websites and even crisis PR would be boltedon as part of the package.

But HLM's close inspection of the figures underpinning the deal showed that Osprey had a 'black hole' in its accounts worth between £2 million and £3 million. The partners would have to conjure up the cash before the deal could be sealed and that was simply too much to ask. HLM had not only lost a dream deal but also a large slice of the six-figure sum which it had invested in Osprey over the course of the deal.

Such transactions, successful or not, are a regular part of the landscape in other industries - just look at the corporate matchmaking going on among the housebuilders since the beginning of the year. But in architecture's world of gentlemen's agreements and often fragile partnerships, what HLM had tried to do was, in Liddle's words, a challenge to 'the profession's financial dislexyia'.

'Most architectural firms do not think about succession plans at all, they just do it when they have to, ' Liddle complains.

'There's an element of enlightened despotism about all this.'

Indeed, he won't be stopped in his attempts to restructure the company and he has other expansionist plans in the pipeline, including a plot to acquire at least one other UKpractice.

Liddle has been through a lot in the past year and it must take a resilient man to watch a personal fortune and a secure future for the practice slip away without a little kicking and screaming. Liddle claims to be that man and he labels the experience, slightly implausibly, 'a complete investment in learning'. His right-hand man for almost 20 years, director and accountant Rod Fraser, also plays down any disappointment over the deal. 'We've had bigger blows to deal with. The quoted company was just the thing to get us from A to B.We'll just look for a different vehicle.'

Those blows include being saved from liquidation in the depths of the recession in 1992. But now the company has PFI projects worth £650 million and an annual fee income of about £7 million, on which it has made a 25 per cent profit over the past two years.

'Our business ethos is to focus on profit rather than turnover and we try to limit our salaries to 45 per cent of fee income. Our ethos is about management, management management, ' Liddle declares. 'The culture of a design partnership and the need for a more corporate approach can cause a problem because partners struggle with business unless they get in experts. I call it the architectural management of finance and it's a mistake.'

This kind of awareness is not the norm for a profession which has recently been lambasted for practically ignoring its profitability by none other than Sir Stuart Lipton, chairman of the Commission for Architecture and the Built Environment.

Liddle is currently working on some politically sensitive buildings, such as the new £40 million Joint Services Command and Staff College at Swivenham and the £60 million Immigration Detention Centre at Harmonsworth. A sneaked look at photographs of the under-wraps projects shows that money is not his only interest and reveals some assured design work.

Liddle is also something of a government favourite and was part of the Department of Trade and Industry's PFI taskforce to South Africa which examined options for hospital designs in places like Soweto, after the collapse of apartheid in 1994. More recently he was at Number 10, chatting with the prime minister at the launch of his 'Better Public Buildings' initiative. The two men talked Fender guitars rather than PFI, but it was Liddle's work on last year's Treasury advice on achieving decent standards of design through PFI which bagged him the invite in the first place.

So putting the Osprey saga to one side, Liddle's star looks to be on the rise again and with nine years consecutive profit growth at HLM under his belt, he may yet be the man to show the markets that the business of architecture is worth investment once again.

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