Devonshire Homes turns to Alvarez & Marsal for administration
A construction company behind housing developments across the South West has gone into administration, with professionals from Alvarez & Marsal overseeing the process. Devonshire Homes was formerly known as a £52 million turnover company.
Devonshire Homes is based in Tiverton, Devon, and has spent years building homes across the historic county – describing its developments as "beautiful new homes" designed for modern living. Launched in the early 1990s, according to its latest accounts, it employed 77 members of staff.
Recent years saw the firm endure a difficult financial period, however, with a forecast large losses in those same accounts – having “significantly underestimated the build costs to build the designs” on a partly-built scheme it acquired with a high proportion of “timber frame architect-designed bespoke houses”. With the development falling “outside of its core strategy of building single family new build homes using its standard housetypes”, the firm made an in-year loss of £156,099 and a provision of £1.12 million was made to recognise a total forecast loss of £1.3 million.
The auditor’s report to the most recently published accounts published last October warned there was a “material uncertainty related to going concern”, meaning the firm was facing severe challenges which cast doubt on its ability to operate normally. It said it required “additional funding to support the development of new and existing sites”.
A subsequent insolvency notice names Alvarez & Marsal Europe as the administrators handling the case. Court documents show Sarah Collins and Jonathan Marston are to take charge as joint administrators.
The administrators cited two projects under construction included in the administration: 225-home The Grange in Bideford; and St Michael’s Reach in Penzance, which was set to deliver 320 homes. They added that their appointment relates solely to Devonshire Homes, while other Devonshire branded-developments or associated companies are not affected.
