IN Brief:
- Durkan is withdrawing from main contracting after more than five decades in the sector.
- Contracting generated £86.7m of revenue in the latest reported year, while legacy fire-remediation costs reached £18.6m.
- Durkan will retain its housebuilding and regeneration operations across London and the Northern Home Counties.
Durkan is withdrawing from main contracting after more than 50 years, ending the part of the business that remained its largest revenue generator during the latest reported financial year.
The group has been reducing its exposure to design-and-build contracting and will complete its final contracting project in Greenwich before concentrating on Durkan Homes and Durkan Regen. Durkan said increasing legislative and regulatory burdens had driven higher risk and declining returns across conventional contracting.
Contracting still generated £86.7m of revenue in the year to 30 November 2025, compared with £30m from Durkan Homes and £28.7m from the regeneration business. The figures put the scale of the decision into context: the company is not closing a peripheral operation but withdrawing from an activity that continued to account for the largest share of turnover while it was being wound down.
The change follows another year in which historic fire-safety liabilities weighed heavily on the group’s reported result. Durkan set aside £18.6m for remediation claims relating to legacy developments, reflecting obligations that have expanded as the Building Safety Act extended the periods during which claims can be brought against developers and contractors.
Separate reporting of the group’s accounts put operating profit at £6.2m before exceptional fire-remediation costs, with the provisions contributing to an overall net loss. The underlying trading result and the exceptional provision pull in opposite directions, illustrating how projects completed years or even decades earlier can continue to affect contractors’ balance sheets long after the original construction revenue has been recognised.
Durkan will remain active in housing construction and existing-building work. Durkan Homes develops new housing across London and the Northern Home Counties, while Durkan Regen covers planned maintenance, building safety, cladding remediation, retrofit, decarbonisation, compliance, and wider asset regeneration for housing associations and local authorities.
The resulting business is more concentrated around development and defined asset-improvement programmes than broad main-contracting risk. Regeneration contracts still carry design, compliance, programme, and delivery obligations, but they differ from taking overall responsibility for a large new-build project where inflation, design development, procurement, subcontractor performance, and programme delay can all sit within the main contractor’s commercial exposure.
That exposure has become harder to price on higher-risk residential work. The post-Grenfell regulatory regime places more formal controls around design and construction, including approval gateways administered through the Building Safety Regulator, while longer liability periods increase the time over which historic work can return as a financial issue.
The approval system has improved from its early performance, although it remains a programme consideration. Building Safety Regulator data published in August showed a median determination time of 22 weeks for new higher-risk building and conversion applications during the latest 12-week period. External-remediation applications had a median determination time of 34 weeks, and 1,547 gateway two applications across all categories remained in progress at the start of August.
Those periods feed directly into construction planning. Design teams, specialist suppliers, procurement staff, and commercial resources can already be committed before work is cleared to proceed, while a delayed construction start extends preliminaries and disrupts labour and supply chain sequencing. Tender assumptions made months earlier can become less reliable as approval dates move.
Fixed-price design-and-build work adds another layer of exposure because the contractor may be required to absorb changes in labour, materials, design development, and subcontractor pricing across a programme that can no longer be treated as completely within its own control. Margins that appear adequate at tender can be eroded by relatively small changes once multiplied across a major residential scheme.
Extended fire-safety liabilities have also altered the commercial tail attached to completed projects. Remediation work can involve surveys, façade opening-up, revised fire strategies, temporary measures, resident liaison, scaffold or mast access, replacement materials, and repeated regulatory approvals. The original construction team may therefore face substantial expenditure without a corresponding new revenue stream.
Durkan’s remaining regeneration operation places the company on the other side of some of that expenditure, carrying out building-safety and cladding work for clients dealing with existing assets. The group is therefore not abandoning the regulatory and technical environment created by building-safety reform; it is narrowing the contractual form in which it is prepared to operate.
The decision lands in a market with no shortage of nominal workload. Public housing programmes, estate regeneration, building-safety remediation, and private residential development continue to generate substantial pipelines. Workload alone, however, does not determine whether a main contract is commercially attractive when design responsibility, compliance, programme uncertainty, and long-term liability are transferred alongside it.
Clients procuring major schemes will increasingly encounter that calculation during tendering. Contractors can decline work, qualify risk, seek higher pricing, or favour frameworks and negotiated routes that allow scope to be developed before a lump-sum commitment is made. The narrower the field of companies prepared to accept a particular risk profile, the less effective traditional price competition becomes.
Durkan’s withdrawal gives that trend a concrete example. After more than five decades in contracting, the group has concluded that the returns available no longer compensate for the risks it is being asked to carry. Its construction expertise remains in housing development, retrofit, remediation, and regeneration, but the conventional main-contracting model will disappear from the business once the Greenwich project is complete.
