The news surrounding the property world right now is the collapse of Carillion. The construction giant’s financial troubles eventually overwhelmed it – we look into how this happened and what it will mean for the property market. We also sum up all the exciting headlines elsewhere in property news.
A mounting £1.5bn debt has forced the UK’s second largest construction company to go into liquidation. No deal could be striked up to save the company and now fears are raised over jobs and disruptions to public projects overseen by Carillion, such as hospitals and schools. The company is one of the largest suppliers of services to the public sector, maintaining around 50,000 homes for the Ministry of Defence and managing highways, prisons and 900 schools.
What caused the collapse? Too many risky contracts that, in the end, proved unprofitable and put finincial pressure on the company and begun their mounting debts. Payment delays from the Middle East also affected the company and banks became hesistant to help. The £350m Midland Metropolitan Hospital, £335m Royal Liverpool Hospital and the £745m Aberdeen bypass were notable failures by the company, delayed by inefficiency and poor planning.
What is next for Carillion and the government? The government have agreed to step in to fund the public sector commitments of Carillion, which was expected. The worry of the impact of the collapse on unfinished projects and public sector commitments long term remains unanswered.
The 20,000 employed by Carillion also fear for their jobs, but it is likely the workers will be employed directly by the government – however private sector contractors are still in doubt. The government may have to nationalise parts of the company so as not to see real disruption across the country. A UK task force has been set up to aid workers and firms affected.
MP’s say Philip Hammond’s housing plan will fail without more reform.
Hong Kong have come up with an innovative solution to ease their growing housing crisis, by building micro homes in cement pipes!
Mortgage approvals have hit their lowest rate for five years according to industry figures.
Swedish architecture firm Plantagon have proposed a design for an office block which also operates as a vertical farm. The World Food Building is under construction in Linköping, Sweden and could be the prototype for bringing farming into urban areas. Most of the farming work will be done by robots.
Local council saves Herzog & de Meuron’s new Chelsea stadium by blocking an injunction that would’ve prevented construction. HEKKTA are happy at this new’s as this stadium is not only right round the corner from us, but it is a stunning design too.
BIG have come up with a scheme to protect San Francisco Bay from flooding. BIG + ONE + Sherwood are teaming up having won the contest and plan to begin by restoring acres of natural space along the water’s edge to improve the resiliance of the area. They also have come up with the idea of floating villages connected by ferries.
Government are being urged to lift councils’ housebuilding cap to allow more borrowing to hit new homes target of 300,000.
Residents of a tower block in Croydon were told they needed to pay for new cladding after the cladding found on the tower was the flammable material that burned down Grenfell.
A pair of Zaha Hadid skyscrapers have been unveiled for London’s Vauxhall. They claim the scheme could create 2,000 new jobs and also create 260 news homes, but some are critical of their height.