Council's Development Partner for 900 Flats Goes Under
Company was working on High Lane and Green Man Lane estates
Visualisation of the planned Green Man Lane Estate redevelopment
January 17, 2024
There is a major question mark over two of Ealing Council’s key housing developments following the collapse of a contractor.
Real Contracting Ltd and Real Places Ltd went into administration towards the end of last year after mounting losses.
The companies are development partners on the High Lane Estate and Green Man Estate developments that were supposed to deliver over 900 new housing units in the borough.
The High Lane Estate is a development in Hanwell built in the seventies which contains 264 flats plagued with damp and mould. The council was in the process of emptying the blocks with tenants expecting to move into one of the 505 new units being built on the site over the next decade. Real Places Ltd was the main contractor on the scheme and less than a year ago was also given the same role on the phased development of the Green Man Lane estate in West Ealing working with the council and A2Dominion to build 396 flats nearly half of which would have been classed as affordable. The project was being developed by Green Man Lane LLP, a JV partnership between Real and A2Dominion with the flats for private sale meant to provide the funding for the scheme.
The Real network of companies was founded by Paul Nicholls and was created when property firm Rydon moved out of the contracting sector in 2021. Real took over Rydon’s building division in the south of England.
An administrator’s report into the businesses produced at the end of last year showed that Rydon had been financially supporting them but losses were greater than expected and inflation combined with delays to projects including the High Lane scheme.
A visualisation of the new flats at High Lane that were planned
The companies have insufficient assets for any payments to be made to unsecured creditors.
Rydon has now purchased one of the group’s subsidiaries, Real (High Lane) Limited although it is not clear whether the company will be taking over as contractor on the scheme.
This is the second time that Ealing Council’s ambitious house building programme has been affected by the collapse of a contractor. Henry Construction went under in June 2023. It is thought that there are now 10 sites across the borough now experiencing delays due to financial issues involving contractors.
Liberal Democrat Councillor Jon Ball, Opposition Spokesperson on Planning, Licensing and Housing, “This latest company collapse shows that Labour has poor judgement in construction partner selection and the delays show they are not prioritising residents at a time of pressing need.”
The Lib Dems believe there is a risk that the failure of to build units for sale on schedule will mean that the interest costs to be funded by the borough will increase significantly.
A council’s spokesperson said, "This has been a challenging period for contractors across the housing sector and the council carefully monitors the position of all its contractors. The council became aware of the issues relating to REAL as soon as they emerged in late 2023 and is currently working with partners to ensure the delivery of good quality homes on these sites can continue as soon as possible. The council is currently working on a delivery strategy for this and for the sites in administration, which will be brought forward in the coming months.”
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