Make Architects has been compelled to cut a quarter of its staff in 2024 amid ongoing financial struggles exacerbated by stagnant global economic conditions and protracted planning delays. The practice behind the redevelopment of the former ITV Studios headquarters on London’s South Bank, which recently marked an official ground-breaking after enduring three years of legal challenges, saw its workforce reduced from 165 to 124 to align operating costs with a diminished revenue outlook.

In its latest report and accounts, Make stated that inflationary pressures, slow market recovery, and project hold-ups forced the decision to implement a company-wide cost-cutting initiative, which included redundancies. The difficult restructuring was described as necessary to secure the firm’s long-term financial stability. Revenue for the year dropped 16% to £15.8 million, while pre-tax losses narrowed slightly to £1.2 million from £1.5 million the previous year. Payroll expenses were reduced by 10% to £11.5 million, although cash reserves also declined from £5.1 million to £3.2 million.

The firm highlighted some tentative signs of industry recovery, noting that easing inflation in 2025 could alleviate cost pressures, even though high construction costs continue to dampen demand for new projects. Its UK operations, the largest revenue source, experienced a 20% decline to £11 million. European income dwindled to £38,000, while revenue in Asia fell by 5% to £2.6 million. Most strikingly, business in Australia plummeted by two-thirds to £608,000, though revenues from other international markets surged to £1.5 million, up from £134,000.

This latest tranche of redundancies follows earlier staff cuts in March 2024, when Make reduced its workforce by around 15%, bringing total employee numbers below 160 across its London, Hong Kong, Sydney, and Shanghai offices. Founder Ken Shuttleworth indicated at that time the redundancy programme was intended to stabilise the practice during a turbulent financial period. Despite a 2% revenue increase in 2022, pre-tax profit had already begun to decline, slipping from £75,000 in 2021 to £39,000 in 2022.

Additional financial context reveals the firm reported a loss of £1.46 million for the year ending 31 December 2023, a notable downturn from prior years. Revenue fell nearly 5% from £19.2 million in 2022 to £18.3 million, attributable largely to the protracted economic recovery and planning delays, including those affecting the South Bank redevelopment. The pre-tax profit drop from a peak of £450,000 in 2020 to a loss by 2023 underscores the mounting administrative costs driven by inflation and rising salaries.

Make Architects is not alone in grappling with these challenges; other firms such as AHMM and Arup also enacted redundancies amid the sector-wide turbulence. The case of Make illustrates the broader pressures architectural practices face as economic headwinds and regulatory slowdowns undermine project pipelines and profitability. Whether the recent signs of easing inflation will translate into a more stable footing for the firm and the industry remains to be seen, but for now, Make’s sustained restructuring highlights the caution pervading the market.

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Source: Noah Wire Services