Directors mount rescue bid after disastrous City scheme forces project manager into administration

Capital Project Consultancy, a London-based project manager, has become the latest medium-sized firm to be engulfed in financial turmoil.

CPC, which lost a high-profile construction management role on the £230m Lion Plaza office scheme in the City of London late last year, entered administration earlier this month. It has now been bought out of administration by four former directors.

The strife at CPC follows the recent collapse of contractors Spectrum Projects and Lark Construction.

The firm recently posted results for the year to 31 January, which showed a loss of £899,567 on turnover of £5.9m. A statement with the results said that the loss of the Lion Plaza contract last November “cannot be overemphasised”.

Steve Mole, CPC’s managing director, issued a statement saying the directors had received backing from an equity partner called R Capital. This was used to form a company, CPC (Realisation), which bought “the name, assets, intellectual property and goodwill of CPC” from administrator KPMG before renaming itself CPC.

The statement said: “The funding provided by our equity partner provides the new business with both financial stability and investment for future growth.”

Mole added: “I am here to take this business forward.”

CPC said in its results statement that Lion Heart Properties, the client on the Lion Plaza scheme, may make a claim against the firm. It said: “The claim, which is strongly refuted by the company, is covered by the company’s professional indemnity insurance.”

The firm recently posted results that showed a loss of £899,567 on turnover of £5.9m

Building understands that the Lion Plaza scheme, which started in 2000, is incomplete six months after it was due to be finished.

Thorstone Land & Property, which is acting for Lion Heart, was unavailable for comment.

Construction cost for the City of London scheme is believed to have hit the £80m mark – at least £15m over budget.

The CPC subsidiary formed specifically for the scheme, called CPC Contracts, went into liquidation late last year.

London fit-out firm Spectrum and Dorset-based social housing contractor Lark were put into administration earlier this month. Lark has since been bought by fast-growing contractor ROK.

Administrative receiver Grant Thornton were called in to Lark on 11 August. Rok struck a deal to take on about 80 staff and a reported £12m worth of contracts from the Redruth-based firm last week. The cost of the sale was undisclosed.

Lark will merge with Rok’s existing Truro-based business. Chief executive Garvis Snook said: “We are delighted, since the company has an enviable reputation in Cornwall.”