Building firm denies finance woe after layoffs

THE boss of one of Munster’s biggest house-building companies yesterday rejected rumours his company was in financial trouble.

John Barry, managing director of Mallow-based Castlelands Construction — which is behind the bid for Douglas Golf Club lands — confirmed last week’s layoff of 50 employees, most of whom had been recently recruited. But, he said, the firm still employs more than 350 people, most of whom are sub-contractors.

He stressed the company was continuing to build the houses it has sold on its sites and said it was preparing new sites to open for further schemes in the coming weeks and months.

“The market has slowed for everyone, but we’ve still had over 50 sales since the start of the year, in Carrigaline and in Mallow, despite all of the uncertainty.

“Now that the election is out of the way and once a government is formed there should be more clarity. We’d hope for a market pick-up in the autumn and 2008 should be a normal year again but with lower demand and overall national output,” said Mr Barry.

He added that — again, contrary to rumours — all six of his home construction sites were open, with sub-contractors and engineers at work.

Castlelands Construction has grown rapidly to become one of Munster’s biggest builders and has sites in strong areas of demand.

It is behind the €170 million bid for lands at Douglas Golf Club, Cork, and has paid a €6m deposit.

It built around 450 homes on its Cork sites alone in 2006 but is scaling back in line with slower market demand.

However, Castlelands still is on target to launch its 400-house scheme in Baneshane, Midleton, within the next few weeks, with 200 names of registered interest, and has recently been granted planning permission for more than 200 new homes at Whitechurch, just north of Cork city.

It has targeted sites in Croatia and France and is awaiting a decision on a planning application for 625 units in a London apartment tower block.

Castelands is also building a new business park and its own new HQ in Mallow.

Construction Industry Federation southern region director Joe O’Brien agreed there was a slowdown in demand but said the market is still fundamentally strong.

“We’re still on target to build a very respectable 75,000 new homes this year, down from a high of 87,000 in 2006. The fundamentals of the market are still strong but builders have had to adjust to uncertainty over stamp duty — which we hope will be removed shortly with a new government — as well as the new reality of higher interest rates.”