Construction work on a £9 million pound sheltered homes scheme in Telford has stopped as the project becomes the latest victim of the nationwide housebuilding crisis.

West Midlands building giants Chase Norton Construction, which was working on the 53-home Extra Care development in Woodside, has gone into administration.

This has left Wrekin Housing Trust searching for a new company to finish the job, while 50 sub-contractors have left the Park Lane site amid fears they will not be paid.

A spokesman for Chase Norton Construction, of Meriden, today confirmed the firm was in administration but declined to comment any further. It has contracts all over the Midlands.

Administrator PricewaterhouseCoopers (PwC) is now handling the company’s finances.

Joint administrator Mark Hopkins, of PwC, said today: “The administrators are reviewing the position at the company in respect of the contracts in progress and are contacting the contract employers for each of the sites to advise them of the administration.

“We are also in discussion with a number of parties who have expressed an initial interest in acquiring the business and/or taking over some or all of the contracts.

“The lack of working capital available to the company also meant the employees had not been paid their salaries at the time of our appointment as administrators.

“Unfortunately due to the lack of available funds, we have been forced to make a significant number of the employees redundant, keeping on only those who are assisting us in the sale of business and transfer of contracts.” About 102 staff have been made redundant.

One Telford-based worker on the Extra Care project, who did not wish to be named, said: “We downed tools and the mood on site was abysmal.”

Wrekin Housing Trust was not immediately available for comment. It is understood to be searching for another company to take over the contract so work can be re-started.

Chase Norton was hired by the trust to design and build the ultra-modern 53-bedroom facility, complete with restaurant, shop and hairdressers. It was due to be ready by next summer.

By Tom Johannsen