The collapse of Lancsville Construction has delayed a £28m Croydon tower by 18 months
Phoenix Logistics, which is based in Norbury, south London, said the 20-storey Iylo tower would not be finished until summer 2011. It had been due for completion two months ago.
Lancsville, a £139m turnover London-based contractor, was building the tower before it entered administration last December. Phoenix said it fired the firm in November, after the project’s programme started to slip and Lancsville warned of further delays.
Phoenix will now complete the project itself, having rehired subcontractors and employed five of Lancsville’s project staff.
Ash Pillai, project director at developer Phoenix Logistics, said: “We have set up the St James’ Croydon LLP, in which Phoenix Logistics is the main owner, and we will continue the job ourselves under a construction management contract.”
Phoenix said it fired Lancsville in November, after the project’s programme started to slip
The newly formed LLP is finalising finance for the project from its bank, Lloyds TSB, which has itself caused further delay.
Pillai said: “Part of the reason it is taking this long is because we were banking with HBOS, which of course has merged with Lloyds. But we are ready to start back on site in the next few weeks.”
The cost of construction will remain about £28m, but interest payments during the delays have caused undisclosed increases in development costs, although Pillai said the project was still profitable.
Lancsville’s biggest project was a residential scheme in Ilford, Essex, called Pioneer Point. According to developer Empire Property Group, the scheme will also be finished 18 months late, in November next year. It will cost £7m more than the £42m originally estimated, owing to delays and defects.