Troubled South West construction giant Midas Group has confirmed that it wants to appoint an administrator in a move which has stunned the region.
Guy Henderson www.devonlive.com
The business, one of the UK’s largest privately-owned construction and property services companies, filed notices of intention to appoint an administrator on Friday, January 28.
This was for three companies: Midas Group, its construction arm Midas Construction, and its housing division Mi-Space.
Midas was recently ranked as the ninth largest private sector firm in the South West, by the Western Morning News, with a reported turnover of £291,267,008 and 498 employees.
But rumours have been circulating in recent weeks that the company was in financial trouble, after it announced a £2m loss in 2021 – its first deficit in 40 years of trading.
The company has important construction jobs ongoing throughout the region and has offices in Indian Queens in Cornwall, Exeter, Newton Abbot, Bristol, Newport in South Wales and Southampton.
However, concerns were raised when it emerged that work has ceased on three major Midas Construction hotel projects in Torquay, and that the Coal Orchard development in Taunton had been hit by a dispute with subcontractors.
Midas has now confirmed its intention to appoint an administrator – a process which can save a firm from liquidation and halts pending creditor action.
In a statement, Midas said: “On Friday January 28, 2022, the company filed notices of intention to appoint an administrator in respect of Midas Group, Midas Construction Ltd and Mi-Space (UK) Ltd.
“This does not mean that Midas has entered into administration and the company continues to operate, while the directors work to explore all available options to achieve the best outcome for the business and our people, our customers, supply chain partners and all our stakeholders.
“Midas is committed to pursuing an outcome that will achieve continuity for our live contracts and asks all our valued stakeholders to remain supportive of the group at this time.”
In 2021, Midas blamed much of its losses on the Covid pandemic and in its statement said: “As has been well documented, there have been issues relating to the Covid pandemic, ongoing shortages of materials and labour, and significant cost inflation, which are providing challenges in the construction sector and across the UK economy, which have had a direct impact on Midas’s own operations.
“Over recent weeks we have been working closely with all our stakeholders to attempt to resolve the situation and are continuing to do so.”
List of projects in jeopardy – and it’s long
Guy Henderson www.devonlive.com
Concerns are growing over the future of some of the South West’s biggest construction projects after Midas Group Ltd announced it intended to appoint an administrator.
The Exeter-headquartered firm and its subsidiaries Midas Construction Ltd and Mi-Space (UK) Ltd are involved in key building schemes across the region including in Plymouth, Torbay, Cornwall, Somerset and Bristol.
The projects include commercial and residential developments, for private and public sector clients, and are in various stages of completion.
But now the future of the schemes has been thrown into doubt after Midas filed notices of intention to appoint an administrator.
Midas was recently ranked as the ninth largest private sector firm in the South West, by the Western Morning News Annual Business Guide 2022, with a reported turnover of £291,267,008 and 498 employees. But rumours have been circulating in recent weeks that the company was in financial trouble, after it announced a £2m loss in 2021 – its first deficit in 40 years of trading.
The company has offices in Indian Queens in Cornwall, Exeter, Newton Abbot, Bristol, Newport in South Wales, and Southampton.
It has sought to reassure stakeholders, stressing it is still operating and said: “Midas is committed to pursuing an outcome that will achieve continuity for our live contracts and asks all our valued stakeholders to remain supportive of the group at this time.”
But if it does go into administration, which could follow in a matter of days, construction projects may well be affected. And if the company goes into liquidation or ceases trading, other firms would have to be brought in to complete the buildings.
Tim Jones, chairman of the South West Business Council, questioned whether the South West would have the capacity or ability to complete so many key projects.
He said: “We are entitled to worry about how any of these outstanding projects can be delivered as they are all pivotal as catalysts for growth.”
Here is a rundown of the key projects Midas is involved in:
Torbay – £40m hotels
Concerns about the financial health of Midas surfaced when work dried up at three major hotel projects in Torbay.
Midas Construction’s work stopped completely at Torbay Council’s £11 Premier Inn scheme at The Terrace in January 2022. The hotel was expected to be completed in late 2022.
And The Fragrance Group, which is ploughing £30m into two hotel builds on Paignton Esplanade, stated it was “increasingly concerned” about lack of process on the sites. The 160-bed Mercure Hotel was expected to open in February 2022, with the Ibis Styles hotel to follow this year.
Plymouth – £22m Barne Barton rebuild
Construction was due to start in spring 2022 after Midas was appointed to build 204 homes as part of the £22m regeneration of the Barne Barton area of Plymouth.
The UK’s largest provider of affordable housing, Clarion Housing Group, is transforming what was once Britain’s largest naval estate into a “sustainable and vibrant community” and Midas was selected to develop a 4.65-hectare site within the neighbourhood via its Mi-space company. The homes are supposed to be ready by early 2023.
Midas was also chosen to carry out hard and soft landscaping, including the creation of a one-way home zone to provide people-friendly streets, together with a public square, open spaces and green areas for people to enjoy.
Bodmin – £6.3m STEM Centre
Midas’ work on Cornwall’s £6.3m “shovel-ready” STEM centre is due to be completed by Spring 2022.
The STEM (Science, Technology, Engineering and Maths) and Health Skills Centre for North and East Cornwall, called the Ottery building, is being built in Bodmin by Truro and Penwith College and is designed to train the aerospace, space, creative, energy, mining and health sector workers of tomorrow.
The project, on which work started in February 2021, is being supported by the Cornwall and Isles of Scilly Local Enterprise Partnership (LEP), which is meeting £3.78m of the costs through the Government’s Getting Building Fund (GBF) for “shovel-ready” projects.
Penzance – £5.8m Creative Cluster
Work started in late 2021 on a hub for creative businesses. The Penzance Creative Cluster being built by Midas Construction at Causewayhead is intended to provide up to 30 modern studios and flexible workspaces for creative sector businesses, from high tech digital companies to visual and performing artists.
The £5.8m project is an important part of Cornwall Council’s wider strategy to regenerate and reinvigorate Penzance town centre.
Liskeard and Bodmin – 146 homes
Building work on 46 homes in Liskeard reached a major milestone with a topping out ceremony in October 2021. The Maudlin Farm scheme, on land south of Lake Lane, is being developed by Treveth, the partnership company set up by Cornwall Council to deliver new homes and commercial development to benefit people who live and work in Cornwall.
It will feature 35 homes for private rent and 11 affordable homes, including seven affordable rent and four shared ownership properties, available from spring 2022. Construction is being carried out by Mi-space which started on the project in March 2021.
Mi-space is also involved in Treveth projects to deliver 100 homes at the former St Lawrence’s Hospital site in Bodmin. The scheme, called Park Lanneves, is expected to see the first homes available in the summer of 2022.
Redruth – £1.9m school extension
The £1.9m project at Pennoweth Primary School, part of the Crofty Multi-Academy Trust, is being carried out to meet growing demand for places and will enable the school intake to increase from 315 to 420 pupils.
Midas Construction was chosen to build the new single storey extension which will provide new teaching rooms and a new small hall in addition to creating an accessible and sustainable building for the expanding school. With work now under way on site, the aim is for the transformation to be complete in time for the start of the new school year in September 2022.
Paignton – affordable homes
Work began in December 2021 to develop nine affordable rent homes including one adapted home at Totnes Road, Paignton.
TorVista Homes and Torbay Council aim to increase the supply of affordable homes within Torbay with the homes due for completion in November 2022.
Mi-space was appointed to build the homes and commenced demolition of the two derelict homes on site in December.
Taunton – Coal Orchard flats
Work has also ground to a halt at the Coal Orchard development in Somerset after subcontractors reportedly walked off site in the days leading up to Midas’ notice of intention to appoint an administrator. Midas Construction is involved in the multi-million pound project to build flats, work spaces and leisure business units on a plot owned by Somerset West and Taunton Council.
Gloucester – £11.8m student accommodation
An £11.8m scheme which will provide additional student bed spaces in the heart of Gloucester city centre is being developed by Cityheart Limited with Midas Construction as the contractors.
The Blackfriars Residence project, in Barbican Way, is the second phase of the Blackfriars Residence scheme and follows the success of the first phase, a 295-bed development, which opened its doors to its first cohort of students in 2018.
The latest project involves the creation of a further 190 bedrooms over two blocks, with 128 student spaces in one block and 62 in the second.
Midas Construction is due to complete the second phase in summer 2022 with the residences will be available for students from the University of Gloucestershire and Hartbury College and University.
Yeovil – town centre refresh
Work has been ongoing in Yeovil to improve the look of the town centre and make it easier and more accessible for shoppers.
Westminster Street was the first area in the town centre to see improvement work under the Yeovil Refresh public realm enhancements. Midas was appointed to undertake the scheme where construction works were due to end in late 2021 with other parts of the town to follow in 2022.
Wincanton – £10m care home
Care provider Cornerstone Healthcare chose Midas Construction to build the £10m Cale View scheme, in Wincanton.
The 74-bed home will provide care for adults of all ages, with challenging behaviours associated with complex neurological and mental health conditions. It is due to be completed in 2022.
Fleet – 60-bed care home
The first of a new generation of care homes is to be built in Fleet, Hampshire, by Midas Construction on behalf of Principle Care Homes.
Heron Manor, on Reading Road North will see the creation of a 60-bedroom care home which will provide residential and dementia care and include features such as a physiotherapy suite, exercise studio and hydrotherapy pool. It is scheduled to open in Spring 2023.
During the past five years Midas has built 15 care homes, on behalf of private operators and local authorities, with a combined value of £100m and providing a total of 627 bed spaces.
Bristol – £10.6m office refurbishment
Midas Construction began work on the £10.6m office and retail refurbishment of the former Tower House, in Fairfax Street, close to The Galleries, with the new look building set to be renamed The Fairfax and opening in early 2022.
The development aims to offer a mix of office and social space, providing a cultural hub. The revamp of the 14-storey, 71,000sq ft office building will see substantial refurbishment across all floors, which includes offices, a café and retail units on the ground floor, one of which will be a yoga studio.
Swindon – £50m housing scheme
Nationwide Building Society’s £50m Oakfield project, delivering 239 homes, is being delivered by Mi-space. Work began in 2021 and is scheduled for completion by Spring 2022.
Southampton – £14m engineering centre
Midas Construction has started work on The Engineering Centre, a £14m project which will enhance collaboration for the University of Southampton Science Park and businesses within the Enterprise M3 LEP area. It will also house the Future Towns Innovations Hub (FTIH).
The building, due for completion in early 2022, will provide specialist laboratory facilities that will support a range of sectors such as eco-hydraulics, electronics, transport research, aerospace, energy, unmanned systems and a number of hydraulic flumes. Wave force tanks and anechoic chambers designed to deaden sound are among the elements to be developed by Midas Construction.
Camberley – power tools HQ
Midas Construction has been appointed to build a new warehouse and GB headquarters for leading global power tools company STIHL.
The project will see the creation of a 11,285sq m purpose-designed facility off the A331 in Camberley, Surrey.
The investment follows sustained growth for STIHL GB and will allow the business and its workforce of 95 employees to move from existing premises nearby in the Yorktown area of Camberley. The Southampton-based Southern Division of Midas Construction began preparatory work on site in December 2021.