Ocon administration due to 'operational issues'
8 Mar 2013, 10:18
Student accommodation developer Opal Property Group confirmed on Thursday that its construction subsidiary will be put into administration.
In a statement Opal said: "Ocon Construction has recently reencountered operational issues on the main university contracts it was fulfilling.
"Opal has worked with Ocon's university clients and Ocon to resolve the position of these ongoing contracts and is pleased that satisfactory resolution has been achieved with the universities concerned.
"Unfortunately the operational issues have resulted in losses for Ocon that have resulted in it seeking to enter into administration."
The statement continued: "Opal Property Group continues to trade and is the third largest operator of student accommodation in the UK with circa 20,000 rooms under management and a turnover of circa £100m."
Opal had until 1 March to agree a complex refinancing package with 14 lenders for debt and interest swap liabilities totalling more than £1bn. Opal may be broken up if loan extensions with the banks cannot be agreed.
Opal provided construction guarantees on Ocon projects. Opal declined to comment further.