Jehu clients search for replacements as contractor enters administration

Several clients of the collapsed Jehu Group have pledged to complete projects that the Welsh firm was working on before it entered administration, with replacement contractors being sought for several sites.

Insolvency specialists at Begbies Traynor were officially appointed as administrators of the Bridgend-based firm and its Jehu Project Services and Waterstone Homes businesses on Friday.

Jehu specialised in construction and development projects for registered social landlords and councils in Wales and the South West of England, and had offices in Bristol.

More than 100 employees had been made redundant a week earlier, with just five being kept on to help with the administration process. Begbies Traynor said Jehu Group had 17 live contracts at this point, which were worth more than £100m combined.

Among them were two projects for social housing provider Linc Cymru, including the 48-home Cascades Tower development on City Road in Cardiff.

A spokesperson for the housing association said: “Linc has had the pleasure of working alongside Jehu on a number of successful developments and we are keeping in touch with them as this situation progresses.

“Our City Road development is in the early stages of construction and so far the site has been remediated and piled foundations have been placed. Work is currently stopped.

“This is also the case for our second site with Jehu in Porth, Rhondda Cynon Taf, which is also in the initial stages of construction.

“We will now take time to assess our position in full and our priority remains the completion of both sites.”

Elsewhere in Cardiff, Jehu was developing 50 flats across two blocks of four and five levels in height on the site of the former Three Brewers pub and car garage for housing provider Wales & West Housing.

A spokesman for the client said: “It’s a sad time for the Welsh construction industry and our thoughts are with the people affected by the situation.

“Our development at Colchester Avenue, Cardiff, is at an advanced stage. We are currently considering our options to minimise any disruption and make sure the affordable homes Jehu Group was developing for us are completed.”

Jehu was also working on a 40-flat scheme on the nearby Leckwith Road in Llandough for housing provider Hafod.

A Hafod spokesperson said: “We will now take the necessary steps to appoint an alternative contractor to complete the development. In the meantime, the site has been secured and is monitored regularly.”

Newport-headquartered housing association Pobl Group had three live contracts with Jehu, which a spokesperson said were being assessed.

They added: “There are two locations affected where we have customers living on site and would like to reassure them that we will do all we can to minimise any disruption this may cause.

“This includes, where necessary, our in-house trades team picking up responsibility for any issues that may occur while new homes are still within the standard defects period. We will also be prioritising customers who were scheduled to move into their new homes over the coming days and weeks, and will be liaising directly with them to resolve their situation.”

Jehu’s latest accounts show it turned over £111.3m in the 18 months to 30 September 2020, making a £4m pre-tax loss. In the 12 months to 31 March 2019, it made a pre-tax profit of £1.15m on revenue of £51.7m.

Huw Powell, managing partner in South Wales for Begbies Traynor, said earlier this month that the contractor’s demise “underlines the crushing impact of the current inflationary environment on an established and successful business”.

He said the company held almost £7m in net assets before COVID-19 struck.

“However, delays in completing projects caused by the pandemic and subsequent cost increases caused a severe cashflow crisis that it could not recover from, despite support from key stakeholders,” he added.

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