Architects take stock as full impact of ISG collapse emerges

According to leading construction intelligence provider Glenigan, the contractor – which went into administration on Friday – had a project pipeline worth £4.3 billion. More than half of that workload (£2.5 billion) was already on site.

Despite media headlines about the 2,000-strong company’s public sector work, such as prisons and schools, newly released Glenigan data shows that nearly two-thirds of ISG’s contracts were for industrial, office or private housing projects.

Among the privately backed schemes now on hold are Piercy&Company’s £70 million Regents Quarter offices-to-labs project at King’s Cross and its nearly completed overhaul of Millennium Bridge House next to The Thames.

A ‘saddened’ Stuart Piercy said: ‘We were successfully working with ISG on two complex retrofit projects, which have, of course, now paused.

‘Due to the advanced stages of these projects, the impact on our workload and financial situation is relatively minor. Our thoughts go out to the network of subcontractors and clients affected as well as the ISG team.’

Leeds and Loughborough-based Watson Batty Architects, which was working with ISG on several schools and the new £33 million Caerphilly leisure centre, said it was ‘devastated to hear the sad news’, having collaborated with the contractor on many projects in various sectors over the years.

A spokesperson said: ‘We wish all former colleagues the best of luck in securing alternative employment. Our [own] wide sector spread and broad client base [will] enable the reallocation of our flexible resource to support the many other emerging opportunities that we have across the practice at present.’

Meanwhile, Pierre Wassenaar, chair of AJ100 practice Stride Treglown, said the practice had been working with ISG on a trio of now-paused schemes. He said Stride Treglown had a ‘longstanding and very successful relationship’ and the contractor had ‘delivered projects with and for them right across the UK’.

He told the AJ: ‘In terms of current workload, we had three live projects which have been stopped for the time being. Fortunately, the financial impact on the practice of this work being paused is minimal and staff have been reassigned to other projects.

‘Our thoughts go out to everyone affected and we hope to work with many of the ISG team in new roles in the future.’

Other projects on ISG’s books that have been hit are the £32.7 million restoration and redevelopment of Birmingham’s Moseley Road Baths, overseen by Donald Insall Associates; the £44 million conversion of Coventry’s former Ikea store into an arts and culture centre by Buttress; and the £281.6 million Queen Square Institute of Neurology and UK Dementia Research Institute for the University College London, designed by Hawkins\Brown.

The extensive list of practices with links to ongoing ISG projects include GT3, HLM and RSHP.

Nick Fairham, chief executive at BDP, said: 'As a multidisciplinary practice, we’ve built a strong, collaborative relationship with ISG over the years, delivering numerous projects for many private and public sector clients, all over the country. This situation further highlights the struggle faced by many contractors, as they continue to navigate poor margins on construction contracts.

The situation further highlights the struggle faced by many contractors

'We know ISG employed many talented individuals, and our thoughts are with them as the industry recovers from the shockwave. Thankfully, the financial impact on BDP has been minimal, allowing us to focus on supporting our supply chain.'

Make, who worked with ISG on the 20 Ropemakers Street office tower, said: 'We are deeply saddened to hear the awful news at ISG, and our thoughts go out to all those affected during this challenging time.'

Speaking about the wider fallout of ISG’s collapse, Glenigan director Allan Wilén, said: ‘ISG’s demise is set to dampen overall industry workload in the near term as clients look for contractors to complete projects currently on site and as recently awarded projects are re-tendered.

‘Its subcontractors and suppliers will be under increased financial pressure and contractors nationwide will need to review and work with their own supply chains to minimise financial stress and avoid any additional loss of capacity.’