10 questions on the impact of Carillion's collapse on Sunderland
We asked Siglion 10 questions about the impact of Carillion's collapse and what it means for the future of its developments across Sunderland.
Here are its answers.
What does the future hold for the buildings owned and managed by Siglion? Specifically, the business centres and their tenants?
These buildings are not reliant upon any continued investment from the Carillion so, it will be business as usual. Tenants in sites across the city will see no changes, and we will be writing to them to that effect.
What does this mean for proposed developments in the city, such as Seaburn, Chapelgarth and Farringdon Row?
We are operating as normal, as Carillion’s equity investment was made up front, Siglion has the financial wherewithal to carry on operationally, without any immediate implications. Construction at the Vaux site has stopped, not because of any issues with Siglion the partnership, but because the appointed contractor is Carillion Construction.
When the council says “Carillion has already made its equity investment in full into Siglion” what amount does that investment stand at? What happens to that cash now?
Carillion made an investment up-front, as the private sector partner in the Sunderland Delivery Vehicle (Siglion).
This financial contribution is being invested in the city, to underwrite active developments, like Vaux, that will spur on city regeneration.
However, we are not able to disclose the financial contribution that was made by the firm, as this is commercially sensitive.
Why has work stopped on the Vaux site?
Carillion Construction were appointed by Siglion in 2016, as the main contractor to construct the first building on the Vaux site, and work has stopped – as it has across many other sites across the UK – on the instruction of PricewaterhouseCoopers (PwC) the appointed receiver.
This is not a decision that is connected to Carillion’s role as part of the Siglion partnership.
Closing down active projects is standard practice in these circumstances. However, Siglion are working closely with PWC and the supply chain to see that this will be resolved quickly and that we can ensure that no momentum is lost and the Vaux site is delivered as expected.
If work has not begun again, when is it expected to?
Siglion are working closely with PwC and the supply chain to see that this will be resolved quickly and that we can ensure that no momentum is lost and the Vaux site is delivered as expected.
Is Siglion looking to bring in a new contractor to complete the work on the phase one office development?
There are a number of possibilities and we are exploring them all.
Has a tenant been found for the phase one building?
The property is being actively marketed at the moment.
Details of who we are engaged with is commercially sensitive.
What was due to come next in the scheme and will that timetable be affected?
The next development scheduled is The Launch, a symbolic structure that will stand at the foot of the Keel Line, connecting the Vaux site to the riverside.
We are still working on delivering this during 2018.
Where were funds generated through rents and sales for Siglion due to go and where will they go in future, should the schemes be completed?
All rents and sales are paid to Siglion which is a 50/50 joint venture between the council and the private sector.
What does it mean for employees? Do they continue to work on a day to day basis or will there be job losses?
There is no change to the day to day workings of Siglion.