The boss of affordable housing association Hillcrest Homes has spoke of her “shock” at the collapse of Stewart Milne Group.
Angela Linton said the unexpected administration left the housing association with 56 homes unfinished in the Cove area of Aberdeen.
The last remaining tenants of the £20.6 million scheme were only six weeks away from moving in to Falkland Avenue, known locally as Stationfields, when work was halted on site in January.
But determined to get the properties finished, 44 apartments and 12 homes, Hillcrest quickly approached administrators to step in to the void left by SMG.
Hillcrest £125,000 loss
Now, six months later than planned – and leading to a financial loss of around £125,000 in missed rent payments – the site is now complete.
Angela said: “It was quite a shock. A lot of the time you know when these are coming but with Stewart Milne we didn’t.
“Quite quickly we arranged a call with administrators. Our properties were 95% complete so we were relatively lucky.
“Administrators were really good and agreed we could take on the rest of the development ourselves.”
Commitment over profit for community
Hillcrest Maintenance reached out to many of the tradespeople and companies previously involved in the project with a number returning, despite most of them involved being out of pocket from Stewart Milne’s collapse.
Former Stewart Milne site manager Graham Mann also returned to the project.
Angela said: “The sub contractors that were already on site were keen to come back, as was the manager from Stewart Milne. He came back and ran the project to the end through the Hillcrest maintenance team.
“There was real continuity for us which meant standards didn’t slip.
“Further funds and appointing a new contractor to complete the project via Stewart Milne’s liquidators would have taken many months – if it had been successful at all – meaning the homes would have been at risk of sitting incomplete for a very long time.
“By doing the right thing and finishing the project despite most of the businesses involved making a financial loss, we’re proud to have prioritised our commitment to the community over profit.”
The development was delivered in partnership with the Scottish Government, who provided £11.6m of funding towards the total cost of the development.
‘As positive an outcome we could’ve had’
Angela admits Hillcrest won’t know the full financial impact of the build until next year but it has already lost out on four months of rental income.
She said: “We won’t know whether this has a direct financial implication until we get to the end of the defect period which lasts for a year when properties are handed over.
“Immediate impact for us was loss of rental income because we should’ve had that start back in March.
“We lost four months which probably worked out at around £125,000.
“But properties that are lying 95% complete empty is not good.
“We are in a housing crisis and it’s not good for people who are desperate to get in to new homes.
“The quicker we were back on site the better for us.
“It was as positive an outcome we could’ve had after such a bad thing happening.”
It was revealed last month that hundreds of ordinary creditors owed more than £33m from the collapse of SMG will receive not a penny back from the ashes of the business.
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