Pierse Construction in Liquidation

Pierse Construction in Liquidation

Postby PVC King » Thu Nov 04, 2010 9:00 pm

Liquidator appointed to Pierse Construction
Updated: 16:35, Thursday, 4 November 2010

The High Court has appointed a liquidator to one of the country's largest building firms, Pierse Construction.

The High Court has appointed liquidator Simon Coyle of Mazars to one of the country's largest building firms - Pierse Construction - which directly employs 109 people.

While much had been made by the company of a €16m bad debt owed to it by another firm, there were more substantial intra-company debts among the 'spider's web' structure of the group, which he said was 'extraordinarily complicated.

He said it was bad news indeed for the employees, who on the threshold of Christmas, were now facing a situation where their employer will be in liquidation. He also had sympathy for creditors who were owed 'colossal sums of money'.

Earlier lawyers for Pierse said its position had 'materially disimproved' since an interim examiner was appointed last month and they no longer wished to proceed with the examinership process.

The judge said a court order seeking the information had been made and it must be complied with.

Pierse Construction is one of the top three construction firms in the country. Founded in 1978, it has worked on some of the biggest construction projects in Ireland

A statement from the company this afternoon said it will work within the constraints of liquidation to minimise the impact of this process on its design teams, sub-contractors and suppliers.



This is a real tragedy, looking at their contribtion of the past few decades they did some really good work such as the remediation of the former Bord Gais site in the South Docklands and the very impressive for its time East Point Business Park which given another decade of prosperity would have in all probability have merged into Fairview / East Wall in the way the IFSC merged into Sherriff St in the late 90's.

Thoughts are with those directly affected from suppliers to employees; nowhere other than construction does the issue of a knock on collapse appear as great a risk; you might operate on a 10% margin but if one link of the chain goes down you lose 100% of the sums you put into the supply.

Under the circumstances that have affected the entire sector it makes the 150 year milestone of John Sisk and Son all the more impressive; their UK arm is impressive. You strongly hope that those behind Pierse get themselves back up and running.
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Re: Pierse Construction in Liquidation

Postby onq » Thu Nov 04, 2010 9:17 pm

PVC King wrote:(snip)
Under the circumstances that have affected the entire sector it makes the 150 year milestone of John Sisk and Son all the more impressive; their UK arm is impressive. You strongly hope that those behind Pierse get themselves back up and running.


Yes, Sisks still carry the torch and let's hope Jed and the boys haven't screwed themselves over with personal guarantees to the banks and can walk away from this having the benefit of limited liability working as intended

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Re: Pierse Construction in Liquidation

Postby wearnicehats » Thu Nov 04, 2010 10:42 pm

PVC King wrote:This is a real tragedy, looking at their contribtion of the past few decades they did some really good work such as the remediation of the former Bord Gais site in the South Docklands and the very impressive for its time East Point Business Park which given another decade of prosperity would have in all probability have merged into Fairview / East Wall in the way the IFSC merged into Sherriff St in the late 90's.

Thoughts are with those directly affected from suppliers to employees; nowhere other than construction does the issue of a knock on collapse appear as great a risk; you might operate on a 10% margin but if one link of the chain goes down you lose 100% of the sums you put into the supply.

Under the circumstances that have affected the entire sector it makes the 150 year milestone of John Sisk and Son all the more impressive; their UK arm is impressive. You strongly hope that those behind Pierse get themselves back up and running.


as bad as the next contractor. had as miserable a time with them as sisk, macs, cramptons and any other you could mention. same shite different arse
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Re: Pierse Construction in Liquidation

Postby PVC King » Thu Nov 04, 2010 10:43 pm

Were there any contractors you thought had a better touch?

As someone looking from the built product point of view Pierse did good work.
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Re: Pierse Construction in Liquidation

Postby FunkyCoW » Mon Nov 08, 2010 3:13 pm

. I have worked on two major Pierse projects - one for the State and one for a commercial organisation - and can honestly say that Pierse were undoubtedly the worst "builders" I have ever come across. Their attitude to quality, safety and honesty was virtually non-existent. They treated sub-contractors like serfs and the tolerated the clients only because they held the purse strings.

The clients on both projects were lucky that they had excellent design teams who fought Pierse every step of the way and managed to achieve good buildings. Not great. Just good. Of course there were a few good foremen, but they took their directions from the top and were instructed to ignore building regs, codes of practice and quality and chase to the programme. Pierse substituted materials when they saw fit and only when they were caught out did they own up. Protection of finished work was not in the Pierse quality handbook, nor was the idea that work should be sequenced to prevent wet trades following dry trades (put the carpets down then plaster the walls – very Pierse!).

Pierse also habitually failed to honour final payments or agreed dayworks, instead promising their sub-contractors that they would be hired on future projects, but only if the price was right.

Who is to blame? The directors of Pierse, to be sure. But also the State for not having adequate legislation in regard to enforcing building regs. And not to mention Architectural Practices that often wore two hats when dealing with Contractor/Developers – one for the Client and the other as a subservient employee.
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Re: Pierse Construction in Liquidation

Postby teak » Mon Nov 08, 2010 3:34 pm

Pierse substituted materials when they saw fit and only when they were caught out did they own up.

No Clerks of Works around ?:confused:
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Re: Pierse Construction in Liquidation

Postby FunkyCoW » Mon Nov 08, 2010 4:19 pm

I did catch them - often! ;)
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Re: Pierse Construction in Liquidation

Postby teak » Mon Nov 08, 2010 5:02 pm

And . . . .

You booked 'em ?
Or they booked you into the Hotel Murat for a week's trawling the Louvre ?;)
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Re: Pierse Construction in Liquidation

Postby FunkyCoW » Mon Nov 08, 2010 5:13 pm

I stood my ground and refused to accept poor quality or non-conformace, and was backed up 100% by my OPW architect and probably 90% by my dual-hatted architect.

On one project we had a saving of €1M plus and the other the client still holds the retention as Pierse hadn't finished the snags/defects

Edited to add: Pierse might have been cowboys but they never attempted bribes - they were too arrogant for that!
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Re: Pierse Construction in Liquidation

Postby PVC King » Mon Nov 08, 2010 8:59 pm

Sounds like my rants against Connaught Group when their shares crumpled during the summer; are you sure you aren't / weren't some form of creditor?

In my limited experience of construction there were always weekly meetings which seemed more like the Somme than anything else where project managers and architects from each side argued everything; and then some.
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Re: Pierse Construction in Liquidation

Postby FunkyCoW » Tue Nov 09, 2010 9:59 am

No, not a creditor, just a humble Clerk of Works who never understood how Pierse ever won a contract considering thier poor track record and obvious disregard for standards and sub-contractors. Pierse site meetings were indeed lively. Project Managers ranting, cursing and banging the table. False promises. Lies. And they even had the gall to blame every one of their failures on the Design Team or their company standard excuse - nominated sub-contractors!. I never heard them admit once that they had made a mistake or apologised for trying to cheat the client by substituting materials. They were always the injured party, deeply hurt by erroneous accusations and impeded by the Clerk of Work's inflexibility.

I can say quite truthfully that the demise of Pierse was felt with a warm glow of relief by more than a few architects, even though some still have to deal with the fallout on uncompleted projects. Were they the worst "big" builder? I have worked with quite a few and the answer is yes - by a clear kilometer!
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Re: Pierse Construction in Liquidation

Postby KerryBog2 » Wed Nov 10, 2010 12:33 pm

PVC King wrote:This is a real tragedy, looking at their contribtion of the past few decades t................You strongly hope that those behind Pierse get themselves back up and running.


Tragedy my arse......... PVC, that post of yours is like the ones Brian O’H. used to write extolling the virtues of Zoe. ;)
Pierse has gone under with a deficit in excess of Euro200 million, of which more than 25% (>50 million) is due to ordinary trade creditors. That means that the knock-on effect will further add to the woes of those creditors – most already overstretched - and will hasten their demise. The size of the deficit would suggest to any financier ‘trading while insolvent,’ particularly when one looks at the amount of intercompany debt. I wonder where all that money went......
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Re: Pierse Construction in Liquidation

Postby KerryBog2 » Wed Nov 10, 2010 1:44 pm

I knew I had written about this stuff before – it was 18 months ago, (here, in full, post #13.. http://www.archiseek.com/content/showthread.php?t=7672&highlight=court )

KerryBog2 wrote:
Commentators are slow to remark on the manner in which most builders & developers have structured their businesses. Most went for “unlimited” status during the boom years to avoid filing their financials and showing their vast profits (useful today for hiding their vast losses), but this is only a decoy. Inevitably the ultimate holding company is a limited entity, registered offshore which protects both their privacy and private assets. Intercompany debt, asset values and thus net worth even when figures are available are considerably disguised.


Intercompany loans at Pierse amount to about 70 million (Sunday Times, 7/11/2010)

KerryBog2 wrote:...........and show the magnitude of the problem when it is realised that the payment process for the costs element of those sales has ground to a halt. From the top of the pyramid downward, suppliers are not being paid. The message is going down the line that “we are awaiting payment on a big job that has been completed/signed-off on/whatever.” Prevaricate, delay, lie. Create longer snag lists, initiate proceedings. Whatever. Everyone is putting off the evil day of realising that the money is not there now and will not be there in the future. Round Two of failures will happen when NAMA starts.


We are well into Round Two. The guys I feel sorry for are those who are slow to accept reality and are pumping money into their businesses to try to keep them afloat until the ‘good times’ arrive... it won’t happen, cut your losses, save your pension fund.

KerryBog2 wrote:............During the boom, builders/developers operated on such huge margins that many never had to worry about accurate pricing. The odd bad debt did not matter, it could be absorbed. Credit control disappeared and credit terms were given out like snuff at a wake..


Bad credit control is now home to roost. (‘Pierse, Dunne, McNamara – ah, shur, the’re grand, supply them.’)

KerryBog2 wrote: NAMA & the future
The big elephant in the room is corporate enforcement, surrounding which there is deadly silence.
All senior bankers, from ordinary manager level up, are legally required to act with probity. (For bankers – that means integrity and uprightness; honesty.) IFSRA rules are very clear about this. Other professionals, like accountants, have similar requirements imposed by their professional bodies. Anyone heard anything from the void of accountancy bodies?


Mmmmmm... anyone yet heard of ANY sanctions from (so-called) professional bodies? Or any senior banker being disbarred from holding a senior position? Or any REAL changes to bank boards?

KerryBog2 wrote:Senior bank managers and anyone who devised lending criteria or sat on a credit committee during the 2004-2008 period have a question mark over their acumen. Directors are in a worse position; if they were aware they should be fired immediately; if they were unaware, they should be fired for incompetence. The banking sector must delete its top level or it cannot ever extricate itself from the present mire.


Sadly most remain on fat salaries; the few that were fired got massive pay-offs, i.e. got off scot free.

KerryBog2 wrote: Huge sums of money were moved around to dress up the dodgy balance sheets of banks. People spoke, phoned each other. These types of conversation, just like Dealing Room transactions, were taped. The Regulator must have known; even now, where are the tapes? Did anyone ask for them? Why the silence? Where are the journalists? Why no real questions?

According to the news today, hours of recordings have been listened to and hundreds of pages of transcripts made. Thank you Mr. ODCE. Now please do something with them. Same goes for the guys who ‘forgot’ their passwords. Clue – anyone from a boarding school education always uses their old laundry number.

KerryBog2 wrote:We saw what the accountants did to a defunct stockbroking firm in Cork a few years ago - they raped what was left, to the extent that the (broke) customers actually despised the accountants more than the stockbroker who ripped them off. Wait for the bun-fest that will be NAMA. The lawyers and accountants are licking their lips already.


According to a report by the Comptroller & Auditor-General quoted by the Sindo , http://www.independent.ie/business/irish/nama-adviser-rakes-in-fees-of-euro58m-2410752.html
NAMA is paying legal fees of up to €485 per hour while even trainee solicitors' fees can amount to €100 per hour ...
KPMG was paid €5.8m by Nama between November 2009 and June this year for valuing loans. Nama's legal advisers, Arthur Cox -- which billed the agency for €911,250 last year ....The CAG's report states that from September 2009 onwards, Arthur Cox is billing Nama for €40,000 per month.
PWC have FOUR staff contracted to NAMA at an original cost of €60,000 per week and now €40,000 per week.
Ah, shur, we’re been oppressed before and got out of it, shur we’re a great country, it’ll be grand.
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Re: Pierse Construction in Liquidation

Postby PVC King » Wed Nov 10, 2010 8:30 pm

KerryBog2 wrote: Tragedy my arse......... PVC, that post of yours is like the ones Brian O’H. used to write extolling the virtues of Zoe. ;).


You will note from the Garathace love in thread I did not join in the we love the convayer belt of lego-brick apartments afflicting BAC albeit that the Dungloe House acquisition provided the operation with sharp cookies on the property side. However one suspects that the collapse of Zoe along with other large Nama held portfolios has created significant systemic contagion that spread from land speculation into the construction industry.


KerryBog2 wrote:Pierse has gone under with a deficit in excess of Euro200 million, of which more than 25% (>50 million) is due to ordinary trade creditors. That means that the knock-on effect will further add to the woes of those creditors – most already overstretched - and will hasten their demise. The size of the deficit would suggest to any financier ‘trading while insolvent,’ particularly when one looks at the amount of intercompany debt. I wonder where all that money went...... K.


One can only speculate that the lack of clarity in the how and when the development pipeline of half completed schemes was going to be handled created difficulty for construction firms in knowing which assurances from developers would be honoured and which wouldn't.

I will rephrase my original point, if this happened in 2006 it would have been shocking and considered by most commentators to be a tragedy; events since that date have obviously numbed sentiment significantly; no doubt the true course of events will come out in the fullness of time but until they do I think it is fair to afford one of the big 4 construction firms the benefit of the doubt on their probably believing some of the assurances they were receiving which turned out not to have been honoured; I strongly hope that the contagion from this collapse is manageable and does not trigger another wave of defaults at subbie and professional levels.

A very slow motion trainwreck has hopefully now come to a halt
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Re: Pierse Construction in Liquidation

Postby KerryBog2 » Fri Nov 12, 2010 11:39 am

PVC King wrote:
I think it is fair to afford one of the big 4 construction firms the benefit of the doubt on their probably believing some of the assurances they were receiving which turned out not to have been honoured; I strongly hope that the contagion from this collapse is manageable and does not trigger another wave of defaults at subbie and professional levels.

A very slow motion trainwreck has hopefully now come to a halt


I don't agree PVC. When a firm goes tits up owing that amount of money, I see no reason to be 'fair' when the facts remain hidden/disguised. The trainwreck has not come to a halt, it is inexorably grinding its way along a broken track and a ravine with no bridge is ahead of it. The rescue train with its IMF crane is building up steam in a neighbouring station....

According to today’s media reports McNamara is supposedly about to go the receivership route – work has stopped on all its projects.

More than a year ago I wrote :-

When NAMA gets going we will see the start of the shake-out. Most of the contractors I have seen recently could not be classed as viable. The big guys will be defunct and will bring many more with them. The efficacy of personal guarantees will prove almost worthless, key assets will be unreachable and expensive homes will be in wives’ names. Then the subbies and suppliers will discover that they never will be paid for their debts. Their accountants will not sign off on y/e figures, or balance sheet valuations, so a lot more will fail. A contributory factor will be lack of finance due to the opaqueness of the financials, where lenders will mistrust the stated values of fixed assets and the real or true worth of the applicant's debtors.

It was in post number 159 here http://www.archiseek.com/content/showthread.php?p=99988#post99988

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Re: Pierse Construction in Liquidation

Postby wearnicehats » Fri Nov 12, 2010 12:01 pm

Macnamaras went into receivership yesterday
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Re: Pierse Construction in Liquidation

Postby FunkyCoW » Fri Nov 12, 2010 12:24 pm

wearnicehats wrote:Macnamaras went into receivership yesterday


Link?
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Re: Pierse Construction in Liquidation

Postby KerryBog2 » Fri Nov 12, 2010 12:25 pm

FunkyCoW wrote:Link?


Its a rumor AFAIK. Have a look at today's http://www.businessworld.ie/livenews.htm?a=2679258;s=rollingnews.htm
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Re: Pierse Construction in Liquidation

Postby wearnicehats » Fri Nov 12, 2010 12:46 pm

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Re: Pierse Construction in Liquidation

Postby KerryBog2 » Fri Nov 12, 2010 12:50 pm

Thanks wearnh. I'm slipping:o:o
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Re: Pierse Construction in Liquidation

Postby FunkyCoW » Fri Nov 12, 2010 1:14 pm

looks ominous for McNamaras. Couldn't happen to a shittier builder - oh wait - forgot about Pierse! ;)
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Re: Pierse Construction in Liquidation

Postby onq » Fri Nov 12, 2010 2:05 pm

FunkyCoW

I'm not letting that last comment on MacNamara's stand unchallenged.

I cannot comment on Pierse, having seen little enough of their work, but I doubt they were as bad as you make out.

My experience with MacNamara's ended back in the nineties, the firm went from strength to strength since then and building failures aare not associated with their work that I am aware of.

(not that I've been keeping tabs on them)

However, while my contact with MacNamara's may be limited, both projects I worked on with them were carried out competently, and their workmanship was certainly up to the industry standards as was their project management.

Any work that was rejected, and this was work done by a sub-contractor on one job, was quickly remedied, and any work practices that were agreed were swiftly put in place.

Where difficuties arose, Bernard MacNamara acted as a hands-on head of company and was involved in any negotiations that had to be dealt with and they were dealt with effectively.

In the Nineties, MacNamara's were the only building firm I knew employing its own in-house architect to vet their own construction methods and details in order to ensure that they BUILT in compliance regardless of what design information they were issued with.

Sometimes this resulted in rapid exchanges of information on compliance matters where new methods or materials were proposed, but the review by the design team was swift and comprehensive and the call rested with me as the certifying architect.

The general impression I formed was that as long as there was a profit margin at the end of the day, MacNamara's would bend over backwards to address any and all issues raised by the design team and placed their emphasis firmly on quality workmanship.

For the record, I don't have any association with Bernard MacNamara or his company apart from this past association, I am not a family friend or colleague and I cannot say we were particularly close on any of the work I did involving their firm.

I grew to respect the man, and he struck me as a tough businessman who understood the bottom line more than most and was committed to delivering a good product for a fair price.

I have already referred your unsupported allegations to the site owner and I would strongly advise you to watch your comments in a public forum.

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Re: Pierse Construction in Liquidation

Postby FunkyCoW » Fri Nov 12, 2010 2:09 pm

weren't Macs the contractor on the section of the new M7 that sunk near Birdhill?
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Re: Pierse Construction in Liquidation

Postby FunkyCoW » Fri Nov 12, 2010 2:41 pm

Well, what a difference a decade makes then. I respect your right to feel offended by honest talk but as I haven't mentioned named individuals or specific projects I shall continue to exercise my right to free speech and comment on what I know.

I worked on a McNamara project for the State. Two years in the trenches. They were late, blamed everyone but themselves (I know, an industry norm), and apart from cutting corners and substituting materials they were dangerous. I was mistakenly sent a fax from a partition supplier confirming that as per the Contracts managers request all fire rated walls were to be replaced by acoustic walls. When confronted he claimed it was a mistake and that the supplier must have "misinterpreted" his requirements. Yet Macs still attempted to install the acoustic walls instead of the fire rated walls, hoping that if they were closed in quickly no-one would ever find out.

In the Naughties Big Mac wasn’t as hands on as he might have been. He was far too busy developing and buying up land banks be concerned with the low income side of his business. He visited site twice in two years, and one of them was at the official opening by his pal Bertie. Flew into Weston from NY in his private jet. Flew back a few hours later. I don’t think he said more than two words to the Site Team.

Interestingly we were dined out after the opening, at the newly McNamara refurbished Morrison Hotel. We were the first to try out the new rooftop restaurant. It rained. We got drenched and couldn't finish our meal. Summed up the whole experience really.
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Re: Pierse Construction in Liquidation

Postby onq » Fri Nov 12, 2010 2:52 pm

I find this difficult to understand in terms of the competence I knew from the firm.
On the building I took to site with them, furniture was moved in in advance of the occupiers, normal enough.
One of the movers may have been a smoker, but for whatever reason one of the penthouses took fire and burned out.
All of the fire containment measures worked perfectly - like I said competent work.

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