The demise of Chase Norton is another blow to the construction sector as the credit crunch continues to bite. Duncan Tift analyses the rise and fall of one of the Midlands’ most high-profile companies.
The collapse of established Midland builder Chase Norton is a major blow to the region’s economy and signifies the rapidly declining health of the construction sector.
The business, one of the four divisions that comprise Chase Midland, has been in existence for 40 years and has been involved in some high profile developments across the Midlands.
Chase Norton started out as a small business carrying out work of up to £350,000 for local authorities, schools, hospitals and petrol stations. However, it was when the company became part of the Chase Midland Group in 1991 that it grew into a significant force in the Midlands construction industry.
It grew to the point where it had an annual turnover of £40 million and worked on projects ranging from minor works up to the £15 million mixed-use scheme in Commercial Street in Birmingham which is designed to revitalise the dilapidated industrial quarter south of the Mailbox.
Its website states that its business philosophy has been “to provide its clients and their professionals with completed projects that reflect high standards of care, quality and innovation.
“Consistently high performance has earned us the reputation of being a flexible and reliable contractor that works in close partnership with both the client and design team to produce high quality buildings at an economical price.
“Whatever the form of procurement or type of building, specialist staff, a direct management style and a unique approach to client needs are the keys to Chase Norton’s continued success,” it continues.
What price these words today?
There appeared no hint of what was to come when back in January, the Meriden-based building contractor was celebrating more than £19 million of new business.
The contracts ranged in size from the £397,000 refurbishment of an existing ward at Warwick Hospital to create a paediatric unit, to a £4.3 million project to build a new church in the Lozells area of Birmingham for the New Testament of God.
Some of the more specialist work included design and build of a training facility for West Midlands Fire Service in Bickenhill.
Last year in Birmingham city centre, on behalf of Hortons’ Estate, it completed the £850,000 refurbishment of the interior and exterior of retail units within Piccadilly Arcade.
This led to Hortons’ awarding Chase a £250,000 deal to refurbish the ground floor and part of the first floor at Latham House in Birmingham.
Alistair Lindsay, managing director of Chase Norton Construction, said at the time: “These contracts not only underline Chase’s ability to deliver projects across a wide variety of sectors but the volume of the work is reflective of our growing reputation in the marketplace.”
A number of the projects were for London and Cambridge Properties, a firm with which the company enjoyed a strong relationship over the years.
The projects also served to illustrate how the firm was strengthening its capabilities in the education sector, seen with the award of a £1.2 million contract by Worcestershire County Council to work on St Mary’s First School in Kidderminster.
It was also appointed the Staffordshire frameworks contract and had expected to work on a variety of community projects for the county council for some years to come.
The fate of these projects is now open to question.
Rumours that the company was in trouble had been circulating for several days prior to Thursday's announcement that the firm had gone into administration.
There were also suggestions that the company was in a vulnerable position because of the ill health of Chase Midland chairman Rod Ackrill.
Mr Ackrill, who is 61, suffered a stroke in May and is currently convalescing, although he has been in the office in defiance of doctors’ advice in order to try and oversee the crisis facing his company.
He said last month that the firm was “asset rich but cash poor” and conceded it was struggling. He said then that the firm was trying to restructure itself and it is thought it had been trying to negotiate a refinancing package but as with other housebuilders recently it struggled to secure backing from its lenders.
The multi-millionaire businessman, who is the current president of Birmingham Chamber of Commerce and Industry, made a fortune in seafood with SPI before selling up in the 1980s and becoming a millionaire overnight.
In 1991 he turned his attention to property and formed Chase Midland. The company was subsequently de-listed and sold to management in 1999.
He owned 88 per cent of the business with the remaining shares split between the senior management team.
Estimates of his wealth vary but according to The Birmingham Post 2006 Rich List his fortune was said to be about £25 million. Its four divisions comprise residential development operation Chase Homes, low-cost housing wing Chase Partnership, commercial development business Chase Commercial and Chase Norton.
Chase Homes is currently involved in a number of projects around the country and in Birmingham is developing the 94-apartment Axis scheme in Harborne