Why Caddick Construction is turning to public sector development in a turbulent economy

The company, which was founded in 1979, has worked on a number of education and health projects over the decades but more in recent years it has focused on build-to-rent apartments and industrial developments.

The firm is building the new £300m SOYO neighbourhood in Leeds. It also has a number of active industrial developments.

Now, though, managing director Paul Dodsworth, who was appointed to the role last August, believes it needs more of a balance between public and private sector work.

Although the construction business saw a 30 per cent growth in its core markets last year it made a £2m pre-tax loss for the year to the end of August 2022.

According to accounts filed at Companies House. this was due to difficult trading conditions, principally arising from the war in Ukraine and the knock-on impact this had on materials, fuel, labour and subcontract prices.

It particularly affected its residential build contracts where the fixed-price contracts entered into earlier in the year meant the significant price increases were not able to be passed on to customers. This was compounded by the cost of time delays due to materials supply issues and staffing shortages.

The company has recently started to join public sector frameworks and forecasts a return to profit for the current financial year.

Speaking to The Yorkshire Post, Mr Dodsworth said: “We’re trying to spread the type of work we want to undertake and who we want to undertake that with.”

He added: “There’s still an awful lot of work around. We haven’t seen projects disappear. What we have found is that projects are taking a little longer to bring to fruition.”

Mr Dodsworth said his plan for the business was ‘sustainable, profitable growth’.

"We’re still wrestling with a bit of inflation. The price of materials tends to go up very quickly and come down very slowly,” he said.

He added: “The price of materials has calmed down and that’s probably down to the housebuilders not being as busy as they were. The availability of bricks, timber and all the rest of it has eased.”

The company is also branching out of its northern heartland into the Midlands with its recent appointment of Ray O’Sullivan as its new regional director in Birmingham.

"It’s the second biggest city in the UK, there’s HS2 and a lot of construction projects going on there. It feels like the natural place to open a new office,” Mr Dodsworth said.

He also plans to open a satellite office in the North East. “It’s about being agile and being able to take steps like this. There’s a void in the North East and, again, it feels like a natural place to have a base,” he said.

The company has undertaken a restructure of its leadership recently following a number of long-term employees retiring from the business.

Looking ahead, Mr Dodsworth said: “We’re about to end our financial year. We’ve got a really strong order book and we will see growth. It’s going to be an exciting year for Caddick.”