X1 Manchester Waters owes £25.7m to creditors
The extent of the special purpose vehicle’s indebtedness is set out in an administration report, which states that investors who put down deposits on unbuilt flats account for £24m of the total owed.
X1 Manchester Waters, the X1 group company set up to deliver five residential blocks on part of Pomona Island on the border between Manchester, Trafford, and Salford, collapsed in June with debts totalling £25.7m.
Of this, more than £24m is owed to 336 investors who put down deposits on flats within the two unbuilt blocks. Three buildings providing 406 have been successfully delivered and handed over.
Freeholder Peel Land, which entered into development leases with X1 Manchester Waters in 2019, has announced its intention to “break the leases” with X1, according to administrator FRP Advisory’s report.
A spokesperson from Peel Waters said: “Peel Land (Intermediate) Ltd sold the land to X1 Manchester Waters Ltd with an obligation for them to deliver the homes on Pomona Island.
“Given X1 Manchester Waters has fallen into administration our key objective now is to find an alternative route for the homes to be completed.”
The investors put down their deposits in 2021 and 2022 and, after the project hit difficulties, were asked in February to agree to a 12-month moratorium so that the two blocks could be redesigned, according to FRP’s report.
Not all the investors agreed to the moratorium and some sought to claim back their deposits but X1 “did not have the funds available to enable the deposits to be repaid”, the report says.
The report states that construction cost increases of £18m, costs related to fire safety remediation work on other X1 developments, and leasehold reform – which has “reduced development values on new schemes by over 4%” – were among the reasons for the collapse of the Manchester Waters SPV.
Another X1 vehicle, X1 Media City, recently entered into administration. That vehicle had delivered three out of four planned towers on a site off The Quays but collapsed before above-ground work had started on the fourth. The site is now being marketed for sale by administrator BTG Begbies Traynor.
Investors have set up a WhatsApp support group that those impacted can join by messaging 07977084808.
