Associations on lookout for new developers after collapse of £117m-turnover firm

“We’re aware of the situation with ARJ Construction Limited and we’re making alternative plans for our development at Vinyl Square in Hayes, which is around 60% complete,” David Gooch, SNG’s executive director for development for London and Hertfordshire, told Inside Housing.

“It’s likely to delay the project for up to six months, and lead to cost increases, but we’re looking at ways to mitigate these. A procurement process is underway to find an alternative contracting partner,” Mr Gooch said.

SNG’s One Vinyl Square site, the former headquarters of EMI records, is due to have 134 affordable homes in an 11-storey building.

The landlord exchanged contracts with Joseph Homes to deliver the properties while still operating as Network in February 2022, as part of a ‘package deal’ with ARJ.

Southern had two developments under construction with ARJ: 134 affordable flats in Purley, Croydon and 109 homes on Parkhouse Street in Camberwell, with 92 for shared ownership and 17 for affordable rent.

The 78,000-home housing association took over the residential part of the Parkhouse Street site from Joseph Homes in 2022.

“We’re now looking for alternative contractors to complete our two unfinished developments that were being constructed by ARJ. We’ll continue to keep all our future residents who have been affected updated,” a Southern spokesperson said.

Dacorum Borough Council’s Paradise Depot development in Hemel Hempstead is set to have 56 homes for affordable rent.

A spokesperson for Dacorum said: “Activity on site has now halted due to the contractor going into administration. The current focus is on checking that the site is safe and secure, before a revised plan for the future of the site is agreed.”

They said that work to install the foundations had already started.

Greatwell Homes is looking for a new developer for Dappletree Court, an £18m project in Wellingborough, Northamptonshire.

The site, due for completion in late 2025, is set to have 57 flats for social rent.

Julie Robinson, executive director at Greatwell Homes, told Inside Housing: “Our thoughts are with the ARJ Construction staff affected, many of whom will have been as surprised as us by this news, given the independent assurances and evidence of solvency very recently provided.

“As our flagship development is in the early stages of construction, we will now procure a new developer able to fulfil our original deadline of completing the build by late 2025, to minimise any impact on our pipeline and our residents.”

ARJ began work in September 2023 to demolish and redevelop 20 flats on the site known as Hearnden Court, which had been part of an independent-living scheme.

Notting Hill Genesis has ARJ listed on its development contractor’s framework, but said it currently did not have any new-build contracts with the firm and would monitor the outcome of the administration process to see if ARJ should be removed.

There are more current projects listed on ARJ’s website, including The Gates, a development of 119 affordable homes in Bedfordshire for Settle Housing, and PA Housing’s Britannia House, an 87-home development in West Molesey, Surrey.

The Gates suffered an earlier setback when the project’s previous contractor, Jarvis Contracting, entered into administration in March 2023.  

PA Housing and Settle Group declined to comment.