Yet another modular construction company in the UK has gone under. A Telford-based firm specializing in modular construction has collapsed into administration, resulting in the loss of 141 jobs.
Telford-based Elements Europe entered administration yesterday, and work has now paused on its two major schemes including the 550-apartment Smith’s Gardens site in Digbeth.
Elements Europe was incorporated in 2005 and traded from a manufacturing facility in Telford. In 2019 it was taken over by South Korean construction giant GS Engineering & Construction.
It specialises in off-site volumetric design and manufacturing of room modules and bathroom pods for use in residential developments, student accommodation, and hotels across the UK.
This isn’t an isolated incident. The modular construction sector in the UK has been facing significant challenges. For instance, Ilke Homes, once a promising modular housing company, went into administration in June 2023, leaving behind debts of £320 million and over 1,100 staff unemployed . Similarly, L&G Modular Homes ceased operations in May 2023 after incurring losses of £295 million over seven years.
These closures highlight systemic issues within the modular construction industry, including high upfront costs, planning delays, and market volatility. Despite government investments and support, many firms have struggled to achieve profitability and sustainable operations.
The repeated failures in this sector underscore the need for a comprehensive review of strategies and support mechanisms for modular construction in the UK. Without addressing the underlying challenges, more companies may face similar fates, leading to further job losses and setbacks in housing development goals.
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Gary Fleisher, The Modcoach, writes about the modular and offsite construction industry at Modular Home Source.
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