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UK’s second biggest contractor Carillion goes into liquidation

Royal Liverpool University Hospital by NBBJ
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Scores of architects face uncertainty this morning after £4 billion-turnover construction giant Carillion went into compulsory liquidation

The Wolverhampton-based contractor, which has worked across almost every sector of the industry, told the City that talks with lenders and the government had failed to secure finance it urgently needed to keep trading.

Concerns remain about when Carillion’s much-delayed £335 million Royal Liverpool University Hospital, designed by NBBJ and HKS, will finally open. The project was due to complete in March 2017, but the discovery of cracks in two concrete beams requiring significant remedial work in January last year pushed the handover date provisionally back to March 2018.

FaulknerBrowns Architects recently won planning for a huge regeneration scheme in Durham backed by a consortium including Carillion’s property development arm, although this stake was bought by the other partners just before Christmas.

Carillion chairman Philip Green said: ‘This is a very sad day for Carillion, for our colleagues, suppliers and customers that we have been proud to serve over many years.

‘Over recent months huge efforts have been made to restructure Carillion to deliver its sustainable future and the board is very grateful for the huge efforts made by Keith Cochrane, our executive team and many others who have worked tirelessly over this period.

‘In recent days, however, we have been unable to secure the funding to support our business plan and it is therefore with the deepest regret that we have arrived at this decision. We understand that HM Government will be providing the necessary funding required by the official receiver to maintain the public services carried on by Carillion staff, subcontractors and suppliers.’

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Readers' comments (1)

  • John Kellett

    This sort of collapse has been on the cards for a while. With the change to tendering building work to contractors ahead of the design stage, that tendering on a guess as to what will be the most cost-effective design for the end-user.

    In order to win the bid ALL subcontractors such as the building designers are 'persuaded' to accept minimum fee levels. Therefore, to keep fees as low as possible, the design team have to work to the contractors brief not the end-user's. Which naturally leads to unhappy clients.

    If the Government contracted the design to architect-led design teams BEFORE involving the contractor it would get the cost-effective solution it needs, which it can then build knowing the 'exact' cost. BIM workflows allow that system to work well as costs are built into the model before a contractor gets anywhere near the project.

    What is needed is larger architect-led multi-disciplinary building design firms that could run large Government projects on a 'design first' basis. Are there any? If there are any I want a job there.

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