ELGIN-based Morlich Homes Ltd (MHL) has entered liquidation after increased construction costs and worsening market conditions slowed sales down ‘considerably’.
The independent housebuilder was incorporated in 2010 and focused on creating and delivering ‘aspirational’ and ‘desirable’ homes. The decision was taken to move to a formal liquidation process at an MHL board meeting earlier this month.
Michael Reid, partner at MHA in Aberdeen, has been appointed as liquidator with creditors set to be sent a report which will be posted on the creditor portal.
Mr Reid said, “Due to the increased costs of construction and worsening market conditions, plot sales slowed down considerably. Construction costs of the factory that MHL built in Elgin were in excess of the projected sum, causing cash flow problems.
“After a full review of the options, MHL ceased trading activities permanently shortly prior to liquidation in order to protect all stakeholder groups.”
MHL’s main assets are its factory in Elgin, nine serviced plots with planning in Elgin, and a former showhouse in Buckie.
MHA said current indications suggest that asset realisations should be sufficient to settle the secured creditor in full, leaving a residual balance for preferred and unsecured creditors. These assets are being subject to an independent valuation.
Other assets include plant, machinery, and vehicles subject to hire purchase and sundry debtors. These are being valued by Thainstone Specialist Auctions, Inverurie, and will be sold ‘imminently’.
MHL had five employees who were dismissed with effect from September 23.
