Drum beats rivals to bag stalled £94m Manchester resi site
Scottish developer and investor Drum Property Group is the frontrunner to acquire the 366-flat Gallery Gardens, one of several failed DeTrafford projects.
Located off Ellesmere Street in Manchester’s Castlefield district, the £94m project entered administration in early 2023 without a brick being laid.
However, there is fresh hope that the development might get out of the ground in the shape of Drum Property.
The Aberdeen-based firm has emerged as the frontrunner to acquire the site out of administration after a five-way bidding war.
The developer has submitted an application to amend certain conditions attached to the planning consent for the 18-storey project, granted in August 2021.
By amending certain conditions, Drum hopes to prevent the planning permission from expiring.
A cover letter written by Deloitte and submitted on behalf of Drum to Manchester City Council states that the proposed amendments, which effectively split the project into enabling and main works phases, “will facilitate the lawful implementation of the scheme, allowing the full economic benefits of the 366 homes in this location to be realised”.
Find out more by searching for reference number 140495/NMC/2024 on Manchester City Council’s planning portal.
An SPV called Drum Manchester headed up by the developer’s managing director Graeme Bone and his fellow directors Stuart Oag and Adam Russell was set up in July.
Most active in its Scottish heartlands, Drum also has schemes south of the border. Last month, the developer lodged plans for Whitehall Sidings, a 391-flat build-to-rent scheme in Leeds.
Drum, one of the underbidders on the Stockport 8 regeneration project, was contacted for comment.
The collapse of Gallery Gardens
DeTrafford’s Gallery Gardens project collapsed in 2023 owing millions to lenders and investors.
Lender Daiwa is owed £25.1m by the two SPVs attached to the Gallery Gardens project – £2.7m in the form of a direct loan to facilitate the scheme and £22.4m by way of cross guarantees against other DeTrafford projects.
Another lender, Maslow, is owed £11m by the Gallery Gardens vehicles by way of cross guarantees against other DeTrafford projects.
Unsecured creditors are owed £7.2m by the two companies, the majority of which is intercompany debt.
More than 80 of the flats have been sold off-plan and £2.1m of deposits has been paid, according to administrator BDO. Around 70 of the purchasers hold unilateral notices.
Why so many failed projects in town?
By Anonymous
Anon – because development is inherently unviable with huge risk. Developer margins around 10-15% on cost which erodes pdq when things go wrong… Developers are not having it away like people like to think
By John W
More apartments for Airbnb.
By Hulme lad
as if we’re not tightly packed in enough already. Perish the thought of having a balance of green spaces and things for the community.
By Anonymous
That’s right, so buying off plan is not advisable
By Anonymous
Drum didn’t beat any rivals, they bought the debt associated with the administration and still have the whole mess left by DeTrafford to unravel, then they have to buy in the councils part of the site and deal with adjacent land owners etc it’ll be two more years before we see a spade in the ground
By Allforone
when the going gets tough, the developers get going, still seen in and around the city spending over peoples cash
By salford fred