A Yorkshire-based developer has filed a winding-up petition against embattled modular firm TopHat.
Harworth Estates Residential Development Ltd filed the winding-up petition on 2 August at the High Court, against TopHat Communities Ltd.
It comes months after TopHat launched a consultation over 70 potential job cuts, which it blamed on a “challenging market”. It also halted work on a flagship, 60,000 square metre manufacturing site in the South Midlands, citing “market conditions”.
Creditors who are owed £750 or more by another firm can file a winding-up petition against that firm in a bid to get back their cash.
The case will go to the High Court in Leeds on 13 August, which will be attended by TopHat.
Firms facing a winding-up order sometimes have their assets frozen, or even have their assets sold by the official receiver if the court decides they will not be able to pay their debts.
TopHat managing director Andrew Shepherd announced his departure from the firm in May. At the time, a spokesperson for TopHat said the firm was forced to take “prudent action” to cope with rampant inflation and supply chain disruption.
TopHat is far from the only modular firm that has struggled in recent years, with a number of competitors going under. The modular construction sector started off with a high amount of optimism, but concerns have since been raised about the low margins associated with the sector.
Modular specialist Urban Splash House entered administration in May 2022, after it blamed operating issues at its factory in Alfreton.
Laing O’Rourke, meanwhile, said in January that it was considering cutting 60 jobs at its offsite factory, in a bid to reduce operating costs, while other specialists including Ilke Homes, Mid Group, Eco Modular Buildings and Caledonian Modular collapsed in recent years too.
The House of Lords Built Environment Committee warned in January that it had “limited confidence” that the then government had a coherent strategy for modular construction.
Construction News approached TopHat and Harworth Estates Residential Development for comment.
