Gleeds is to buck the recent trend among leading quantity surveyors by becoming a limited company rather than a limited liability partnership within the next five years.
The biggest quantity surveyors such as EC Harris and Davis Langdon were previously partnerships, which meant that partners potentially had unlimited liability if a project went wrong. They have moved in the past two years to the LLP model, which caps the amount of money that partners are liable for.
Gleeds senior partner Richard Steer said he was looking to have half of the business as an LLP and the other half as a limited company in the next one to two years. However, the business would move completely to a limited company within five years.
Gleeds’ UK cost consultancy would initially be an LLP, but any overseas quantity surveying ventures would be set up as limited companies. Steer said: “Overseas clients just do not understand the partnership model.”
He added that it recently had to sign a contract with a client in China using one of its subsidiaries that holds limited company status, rather than through the parent group. “We started saying ‘partnership’ and they just didn’t understand what we meant,” said Steer.
In the UK, Gleeds has set up a series of subsidiaries as limited companies in recent years, one example being its energy division. Steer wants to rationalise these firms into a single limited company.
Steer said that he did not see a long-term future in being an LLP, as the limited liability cap would only rarely be needed. He said: “An LLP helps against a doomsday scenario, but moving to an LLP would not be going far enough. I am not talking about a flotation, but a modern corporate structure rather than just a continuation of partnership status.”
Gleeds has also looked at the option of floating, but has concluded that construction companies and their consultants are not interesting enough to traders to raise suitable funds from the market. Steer said:
“Even the major contractors that are listed struggle to move their share price.”
Gleeds this week appointed Damian Wilkinson as an associate director within its management services business in Leeds. He has been appointed to develop the litigation support and dispute solution part of the business.
In a second appointment, also within Gleeson Management Services, Andrew Rees has joined as senior consultant and will be based in Bristol.
No comments yet