I have been seeing, and writing a lot lately about companies going bust, in part because it is what I am reading and seeing happen. Especially in my city of all places.
And how do I know this?
You watch a company demolish an existing building and begin to build a new one; be it a commercial/retail site, or homes. Then you don’t see any progress being made. The site becomes another wasteland of space, and in some instances, a partially built building.
Just off the top of my head I can think of four (4) sites in my city that work/building was started, only to have the developer go bankrupt. The company runs out of money, and cannot borrow any more money.
This leaves these sites open to vandalism, depending on the stage of building, and also a hazard, and an eyesore.
So you may ask, why did these developers go bust?
Some bite off more than they could chew. They did not anticipate the full costs associated with developing the land into what they planned or envisioned.
Some could only get financing to a certain point. One developer here needed £5 million to fully realise the scheme, but only got £2 million. So now a half built block of flats sits empty.
Of course when a company goes bust there is a rippling or domino effect. In this instance, it makes the city look like a huge work in progress, that is not progressing.
It also costs the city and Council money, as in some instances the Council must bail out not the company, but make sure the work is finished.
When Carillion a huge construction company went bust, they were in the process of building schools and hospitals, all of which can to a stand still. Local Councils had to help out and find builders to complete the jobs.
As I have stated in the past, when a company goes bust, there is more than the loss of job, and also paying suppliers, etc. They leave work undone, and a bit of unsettledness in the community.