Homes England will receive just 0.1 per cent of what it is owed by Ilke Homes, after the company’s administration process was hit by the theft of equipment and problems selling completed modules.
The collapsed modular homebuilder owes creditors £321m, including £68.7m to Homes England, but the current payment to the taxpayer-funded housing agency is estimated to be £82,000 £.
Ilke also owes £725,000 to its employees, £2.2m to HMRC and £249.3m to unsecured creditors. None of them will get anything.
AlixPartners’ administrators applied to the court for Ilke’s liquidation in September after it became clear they could recover “significantly less value … than originally anticipated”.
This was partly due to a burglary at Ilke’s Flaxby Moor factory in Yorkshire in August, when equipment that had been auctioned off two days earlier was stolen.
On August 19, 40 people cut through several secured gates and entered the site with at least 14 vehicles, including caravans and vans, according to North Yorkshire Police.
The group refused to leave until the early hours of August 21, despite the presence of security, police and auctioneers, Hilco Valuation Services.
North Yorkshire Police confirmed that a “large amount” of equipment worth thousands of pounds was reported stolen. Site security was unable to find any of the missing equipment while searching the vehicles.
Admins were also unable to sell 300 completed modules in storage. The original customers were unwilling to purchase the modules as they would not be able to complete the homes without access to the manuals which were stored electronically and could not be accessed. As the modules were designed for each customer in terms of specifications and foundations to be installed, it was not possible to find other buyers.
In addition, a third-party vendor claimed title to the modules and some of the associated intellectual property.
The money returned to Homes England came from the sale of a high-speed assembly line at the August auction for £188,000.
Ilke Homes was established in Knaresborough, Yorkshire, in 2018. It went into administration in June, immediately making 1,039 of its 1,061 employees redundant.
In May and June, it approached 36 companies to buy the troubled homebuilder. A bid of £25m was received, according to previous reports from the administrators, but the deal fell through.
A spokesperson for Homes England said: “A core part of our mission is to support the creation of a more resilient, diverse and innovative housing sector and to invest in MMC. [modern methods of construction] is an important part of it.
“There is always an inherent risk when investing in new technologies with new business models that seek to do things differently, but we remain committed to encouraging greater use of MMC, supporting its growth and diversify the housing market”.
