Cost consultant says wary firms turning down chance to bid schemes becasue of worried over viability of schemes and builders
Looking after cashflow and getting access to credit are the single biggest concerns among façade contractors, a new report for QS Exigere has warned.
In a sentiment survey, the firm, which is working as the cost consultant on Landsec’s £250m Hill House scheme in the City as well as Stanhope’s redevelopment of the IBM building on London’s South Bank, said there was also a “reluctancy to engage unless project designs and budgets match build complexity from the outset”.
And it said façade contractors “are generally opting not to bid for projects which have insufficiently developed designs or involve main contractors with ‘shakier’ credit ratings – too many have been caught out taking these risks before”.
It added: “Suppliers have little appetite for projects perceived as ‘riskier’ or likely to go on pause due to funding or planning complications.”
Exigere said jittery clients putting the brakes on jobs were also making them pick and choose more which jobs they were going to bid.
It added: “Hesitation from developers is hampering the ability of these businesses to plan ahead to limit gaps in their production lines.
“This, combined with the yet uncertain effects of the implementation of the Building Safety Act in the UK and the ongoing and real risk of main contractor insolvency, is causing many façade contractors to play the conservative hand when deciding which opportunities to bid for.”
Exigere said façade contractors were ploughing money into improving in-house processes or restructuring to make sure they were better placed for a predicted uptick in activity next year and in 2026.
“[This] is the measured approach being taken by most façade contractors, as opposed to seeking out any tendering opportunity available in a knee-jerk attempt to protect profitability in the current financial year.”
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