Collapsed DeTrafford vehicles owe £26m to creditors
BDO, the administrator for the SPVs behind two Manchester city centre apartment schemes, estimates that one lender will get the majority of its loan back, while another could miss out completely.
The vehicles behind DeTrafford’s 138-apartment St George’s Gardens and 109-apartment City Gardens collapsed in September and October respectively, with a total of 38 apartments unsold.
Reports by BDO of the affairs of both firms show debts totalling £26m.
The lenders
Of this £26m, lender Daiwa is owed a total of £7.5m, according to BDO’s reports.
Daiwa, for whom CBRE Loan Services acts as junior and security agent, is owed £7.5m by City Gardens and £29.9m by St George’s Gardens, the reports state.
Lender Maslow Capital is owed £11m. £10.5m by City Gardens and £369,000 by St Geroge’s Gardens.
BDO estimates Maslow will get £8.8m at the end of the administration proceedings for both companies.
However, BDO’s current estimates indicate Daiwa will get nothing.
Daiwa registered its charge against both companies on 13 November 2020. As a result, Maslow’s earlier charge takes priority when it comes to realisations through the administration process.
Daiwa also “holds first-ranking security over other entities in the DeTrafford Group”, according to BDO’s reports.
The investors
The two DeTrafford vehicles also owe around £1.2m to individuals that have paid deposits on the developments.
The likelihood of the investors getting their money back depends if they hold UN1 notices registered before the date Maslow registered its charges against the DeTrafford vehicles – May 2018 for City Gardens and February 2019 for St George’s Gardens.
BDO expects £948,000 to be returned to investors in City Gardens and £35,000 to St George’s Gardens investors.
Other creditors
DeTrafford City Gardens owes £4.2m to other St George’s Gardens creditors, while City Gardens owes £2.3m. There is no distribution expected for these creditors at present.
The masterplan
St George’s Gardens and City Gardens are part of a wider masterplan being developed by DeTrafford in the Castlefield area of Manchester.
Also complete is Sky Gardens, a 174-apartment project.
Planning approval is in place for two additional blocks, Gallery Gardens and Phoenix Works, which will provide another 366 and 267 apartments respectively.
