Housebuilder Stewart Milne has collapsed into administration - but the future of its North West developments is still uncertain as its founder says he is “devastated” by the news.
The group, based in north east Scotland, was put up for sale in April 2022 after its eponymous founder and main shareholder Stewart Milne decided to retire after more than 50 years. The sale process was paused in December after the turmoil of Liz Truss’s mini-Budget but resumed last summer.
Now administrators from Teneo have been appointed to Stewart Milne Homes North West England, as well as to the Stewart Milne Group and to five other Scottish subsidiaries.
However, Teneo said the group’s active development sites in the North West were held by Stewart Milne Homes North West England (Developments) Limited “which has a separate funding structure and has not been placed into administration with the group companies”.
It added: “The strategy is being discussed with Homes England and there should be more clarity by the end of the week.”
Some 58 employees working with the developments business have been retained as that process goes on.
A Homes England spokesperson said “We are aware that the majority of the Stewart Milne Group (SMG) of companies has been placed in administration with an English subsidiary that Homes England has a relationship with likely to follow later this week.
“Our immediate priority is to work with the administrator to support the continued delivery where possible of those housing developments we’re involved in.”
Stewart Milne bought Wigan-based Nuttall’s in 2007. Its pipeline includes developments in Stockport and Congleton.
In 2018, the Manchester Evening News reported that Stewart Milne Homes North West had secured £11.5m from Homes England through the Home Building Fund to deliver almost 500 new homes in Chester, Prescot, Congleton and Hooton.
Teneo today said: “Like many in the housebuilding sector, Stewart Milne has faced significant challenges over the last few years, with economic uncertainty due to rising interest rates, increasing cost pressure and an associated reduction in consumer confidence. The directors have explored multiple options to secure the future of the business, including running sale processes, most recently from May 2023.
"Unfortunately, this did not result in a transaction and other options to restructure the group were ultimately not viable.”
Some 217 roles at the group were made redundant on the administrators’ appointment, with 54 employees retained to help with the wind-down of the group’s operations.
Adele MacLeod, joint administrator with Teneo, said: “The downturn in the UK housing market combined with an extensive sales process not resulting in any viable offers has ultimately led to the need for the directors to place Stewart Milne Group Limited and some of its subsidiaries into administration, regretfully with some immediate redundancies.
"We continue to assess all the options in respect of the group’s Scottish development sites and encourage any party with an interest to get in touch.”
Mr Milne, founder of the group and previously chair of Aberdeen FC, said: “I am devastated by this totally unexpected outcome of the sale process and struggling to accept it, given the profound impact it will have on employees, sub-contractors, suppliers and customers.
“Stewart Milne Group was up for sale and, following significant interest, two bids were submitted - the bank has not accepted either bid and withdrawn its funding which left the directors with no option but to appoint administrators.
“I tried everything I could to find a way to achieve a better outcome for the business and the people who depend on it.
“I believe one of the bids could have delivered a comparable, financial return to administration and, crucially, allowed the business to continue to operate, safe-guarding hundreds of jobs and protecting livelihoods.”
The collapse of the Scottish group was reported today by our sister title insider.co.uk - which also reported on fears that more of the country’s housing firms could collapse.
Jane Wood, chief executive of Homes for Scotland, told BBC Radio Scotland’s Good Morning Scotland programme on Tuesday she was “greatly saddened” by the group going into administration.
Asked if she was concerned more housebuilders could go the same way, she replied: “We are very worried about it and we are worried the social and economic impact is not understood for housing.”
She added: “Our ask would be that the Scottish Government needs to demonstrate that it does recognise the sector’s concerns and takes urgent action – that the provision of new homes for all tenures for everyone in Scotland who wants to live and work here is prioritised because it is urgent now.”
