Administrators in bid to get workers back on delayed university campus

The Ulster University Belfast Campus, where work on phase two has been stopped for more than a week. Photo: Hugh Russell
Gary McDonald Business Editor

EFFORTS are continuing to ensure construction workers can get back on site "as soon as possible" on the long-delayed £250 million Ulster University campus in Belfast.

John Hansen and Stuart Irwin of KPMG have been appointed administrators of Lagan Construction Group Holdings Ltd and three-associated firms.

Lagan and Portuguese-based Somague are joint-venture partners on the UU scheme, which was due to open later this year but which has already been pushed back until at least the autumn of 2020.

Lagan-Somague landed the mega-contract in 2014 to build phase two of the £250m project, a £150m development of two new blocks on York Street.

But when Lagan got into difficulties on February, workers from all the firms involved, including subcontractors, subsequently downed tools, and some suppliers, sensing a potentially ominous situation, moved in last week to remove plant and equipment.

KPMG was formally appointed on Monday to run the Lagan operations, and most of its 200-plus workforce has been asked not to attend for work while the accountants assess various options over the coming days.

In a statement confirming its appointment to Lagan Construction Group Holdings Limited, Lagan Construction Group Limited, Lagan Water Limited and Lagan Building Contractors Limited, KPMG says it is "assessing the position" of the affected companies, adding that "it is likely this process will take a number of days".

They say: "We realise this period of uncertainty is very difficult for all employees and stakeholders of the companies and the joint administrators are endeavouring to complete their assessment as quickly as possible."

Among the options will be to find another partner to work on the project alongside Somague.

But it is understood the Portuguese construction group may be having problems of its own, and therefore would be unable to complete the project on its own.

At the time of its appointment in 2014, Somague president Rui Vieira de Sá said: "This is our first partnership with a Northern Ireland construction company and we believe this joint venture can deliver significant benefits to both Ulster University and the wider construction sector."

Neither Lagan nor Ulster University was immediately available to comment on the latest development.

But last week Ulster University said it was consulting with Somague as necessary to progress delivery of the project and was awaiting the formal appointment of an administrator to the relevant Lagan companies.

It added: "The move into the new building in 2020 was based upon the latest agreed contractors programme and as any updates to time frames are agreed we will make that information available.”

The construction contract has already been the subject of legal proceedings which could delay the opening of the new university campus - the largest of its kind in the north - by another two years.

The legal case brought by the university is understood to focus on claims that work on the campus was "not carried out in accordance with the contract".

When complete, most of the UU academic courses will transfer from Jordanstown to the centre of Belfast, boosting student numbers in the city from 2,000 to 15,000.

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