Administration at builders Southdale causes 30 North East job losses

Part of the firm has been bought by Kier Living following the administration brought on by cash flow issues

Tom Yeoman / Red Wellies Photography Craig Knowles of Southdale
Craig Knowles of Southdale

North East staff at housebuilders Southdale have lost their jobs following the collapse of the firm.

Around 30 workers at Southdale’s Newton Aycliffe base were among 87 redundancies while 128 jobs across the firm’s Halifax and Warrington offices were saved as Kier Living acquired part of the business.

Halifax-headquartered Southdale fell into administration last week following cash flow problems caused by a “significant number” of loss making contracts.

Peter Holder, Lee Causer and Anne O’Keefe of AlixPartners Services UK LLP (AlixPartners) were appointed joint administrators.

AlixPartners immediately sold parts of the Southdale business to Kier Living Limited, the construction group’s recently formed housing business.

Kier said it was seeking the potential substitution of existing Southdale contracts for new ones, and the 128 staff retained would support this move.

In a statement following the purchase, Kier said it would work closely with the administrators and employees to maintain continuity for clients and supply chain partners.

John Anderson, executive director at Kier Living, said: “Today represents an important milestone for Kier Living as we expand our presence in the north of England in order to deliver our growth plans, as set out in Kier’s strategy Vision 2020. Nationally Kier Living plans to increase output from around 1,500 units per annum currently, to around 4,000 units by 2020.

“Not only will we be able to use the combined capability and expertise of the two teams to deliver existing developments, we will also be able to expand our offering to a wider range of clients, and deliver projects of an increased scale. I would like to take this opportunity to welcome Southdale employees to Kier and look forward to continuing our journey of growth with them.”

Only in the last month Southdale said it would be using more than £11m of new contracts in the North East to pass opportunities on to the local supply chain.

At the time the firm outlined key contracts including the delivery of 67 homes across South Tyneside, valued at £7m, and 49 homes in Newcastle.

It remains unclear what will happen to these projects.

Journalists

David Whetstone
Culture Editor
Graeme Whitfield
Business Editor
Mark Douglas
Newcastle United Editor
Stuart Rayner
Sports Writer