Major construction sites across London were brought to a halt as the Ardmore group moved to enter administration through the courts following missed payments to employees and subcontractors.
Businesses affected by the collapse include Ardmore Major Projects, Ardmore Hotels & Commercial, Ardmore Regeneration, Ardmore Fitout and Landmark Facades, with more than 500 jobs expected to be impacted.
The failure of the £350m-turnover contractor leaves a number of high-profile London developments facing uncertainty, with clients now seeking replacement contractors to complete ongoing schemes.
At the time of its collapse, Ardmore was delivering around 10 major projects across the capital, including luxury hotel developments in Mayfair and Kensington, residential tower projects and a major life sciences laboratory campus at King’s Cross.
The administration follows the group’s long-running efforts to manage liabilities linked to historic residential developments requiring extensive fire safety remediation following post-Grenfell regulatory reforms.
Nearly a year ago, Ardmore Construction, the original contracting business responsible for many of the affected projects, entered administration in an attempt to shield the wider group from future claims.
However, the situation changed significantly following a landmark legal challenge brought by housebuilder Crest Nicholson.
The High Court ruled that Building Liability Orders under the Building Safety Act 2022 could extend liability for building defects beyond the original contractor to parent companies and associated businesses within the same corporate group.
The judgment, which Ardmore intends to appeal, potentially allows developers and building owners to pursue claims against companies across the wider Ardmore group, substantially increasing its potential financial exposure.
Several major housebuilders, including Barratt, Taylor Wimpey and Bellway, are currently pursuing significant claims against the group.
Industry sources said growing concerns over the scale of potential liabilities had increasingly affected Ardmore’s ability to secure new work, with clients and funders becoming more cautious despite the contractor’s substantial live order book.
Administrators are now expected to evaluate options for the affected businesses while project clients move to appoint alternative contractors to complete unfinished developments across London.
Meanwhile, the wider Ardmore Group, including its property development operations, has not entered administration but has instead applied for a moratorium process that will allow the business to continue trading while its financial position is reviewed.
The move is intended to provide Ardmore with time to continue preparing its appeal against the High Court’s Building Liability Order ruling in the Crest Nicholson case.
Earlier this week, Ardmore was granted permission to appeal to the Court of Appeal, with the court also agreeing to expedite the process due to the significance of the legal issues involved.
Ardmore argues that the appeal raises matters of wider importance for the construction sector, including when Building Liability Orders can be issued and the extent to which group companies can be held responsible for liabilities arising from historic construction projects.
A spokesperson for Ardmore said: “This is a deeply disappointing outcome for the construction group, its employees and its stakeholders.
“Our focus is now on preserving value in the wider Group, protecting the continuing businesses where possible, and pursuing the appeal against a judgment which we believe raises important questions for the wider industry.”