Hull safety equipment provider Arco said work on its new £25m National Distribution Centre has been completed, after its lead construction contractor collapsed.
The new warehouse space, in Henry Boot Way, will form a key part of Arco’s ambitious strategy to grow turnover to £500m.
The historic Hull company appointed Scunthorpe-based Clugston to lead construction of the centre – a new landmark for those entering and leaving the city on the A63.
On Friday morning, it was confirmed Clugston Construction , with more than 250 staff affected.
However, despite Clugston’s demise, Arco has now confirmed construction work on its new £25m distribution centre has been completed.
The company also spoke of its sadness at the Clugston Construction announcement.
A spokesman at Arco said: “Arco, the UK’s leading safety company, is very sad to hear the news that Clugston has filed for administration. The team at Arco expresses its sympathy for all those affected by this unfortunate situation.
“Based on the safety record and the high quality of work Clugston consistently delivered, Arco chose it to build its new National Distribution Centre (NDC2). Arco has built a strong partnership with Clugston and enjoyed a good working relationship throughout the build.
“The NDC2 construction project has been completed and, following the formal handover on October 4, Arco is in full ownership of the building.
“The NDC2 inauguration date is on track as planned for early 2020. There were milestone payments throughout the project which were made on time and reflected the quality of the build and the great partnership between the two companies.
“Arco is very saddened by this shocking news and its thoughts are with the people at Clugston.”
Arco previously announced 200 new jobs would be created with its new warehouse.
The 20,439m² space will house additional warehouse and logistics capabilities, doubling Arco’s capacity.
In the year up to June 30, 2018, turnover at the Hull family-owned business reached £295.1m.
With an ambitious target in place to grow that to £500m, the National Distribution Centre is seen as a key part of Arco’s next chapter.
On Friday, Clugston Group’s management team is doing all it can to save jobs and ease the impact on supply chain companies.
With administrators expected to be formally appointed today, efforts to retain staff on build projects to keep them on track is understood to be a core focus,
David Clugston, who is due to take over the business from his father at the end of January, said: “We are still working with KPMG, the administrator, to save jobs related to key construction contracts and protect creditors.
“The distribution business is unaffected by this and is continuing to trade.”
Elsewhere in Hull, construction work started recently on Arco’s new £16m headquarters in the city’s Fruit Market.
That project is being led on the construction front by Hull-based PDR Construction.
