Homes England could lose up to £9.2m from the administration of Stewart Milne Group.
Manchester-based Stewart Milne Homes North West England (Developments) Ltd went into administration on 12 January and has a different administrator to that of the rest of the housebuilding group, which folded four days earlier.
The English arm of the Aberdeen-headquartered group received a series of loans from Homes England since 2018 – with the taxpayer-funded housing agency still owed £9.2m by the business.
A statement from BDO, the administrator for Stewart Milne Homes North West England (Developments) Limited, said Homes England “wishes to consider strategies for the company with BDO separate to the administrations of the other seven companies in the wider group”.
Stewart Milne’s English division operated four sites in Lancashire and Cheshire – at Broughton, Congleton, Hooton and Warton – which all received funding from the government’s housing agency.
The Stewart Milne Group had been up for sale since April 2022 and its accounts for the year to 31 October 2022 noted there was uncertainty that it would continue as a going concern as a result – although Homes England made no further loans to the group after it was put on sale, Construction News understands.
A spokesperson for Homes England said: “We are aware that the majority of the Stewart Milne Group of companies were placed in administration on 8 January 2024. We are also aware that the English subsidiary, which Homes England has a relationship with, was placed in administration on 12 January 2024.
“Our immediate priority is to work with the administrator to support the continued delivery, where possible, of those active housing developments which will, in due course, realise the value of the company assets.”
Matthew Tait, one of the joint administrators from BDO, said: “This administration is at a very early stage. However, our present intention is to work closely with Homes England and other stakeholders as well as management and staff, to develop a strategy that results in the continued delivery, where it is possible in line with our duties to creditors, of the company’s four housing developments.”
In October 2023, it emerged that Homes England would only receive 0.1 per cent of the £69m it was owed by collapsed modular builder Ilke Homes, which went under a few months before.
A year earlier it was hit by the collapse of House by Urban Splash, into which it had pumped £30m, and owned a 4 per cent stake. CN understands it was able to recover £27m of the money.
In April 2020 it partnered with Inland Homes to develop more than 600 homes on a Homes England-owned site in Basildon, Essex. The housebuilder collapsed in September 2023 before the project was complete. Talks are ongoing about selling assets owned by the housebuilder to Homes England.
DRS Bond Management managing director Chris Davies said: “There is no question that construction and housebuilding are not in the best shape at the moment, but I think Homes England needs to look at the criteria that they use in assessing who they’re lending to.
“They need to recognise that they should be delivering value for money, and if units aren’t getting built because the entity to which they’ve advanced money has collapsed, that’s problematic.”
The rest of the Stewart Milne Group, run by former Aberdeen Football Club chairman Stewart Milne, operated in Scotland and its administration is being carried out by Teneo. The housebuilder and developer was founded in 1975.
At the time of its last accounts, the £172.4m-turnover group owed £114.3m to banks and £23.8m to trade creditors.