Elliot pledges funds for ailing schemes
The Liverpool-based developer facing allegations of fraud has pledged to inject the funds necessary to complete three stalled schemes, or risk them falling into administration amid a police probe.
Construction has halted on three Elliot Group schemes, The Residence in Salford, and the Aura and Infinity schemes in Liverpool.
The developer had written to investors asking them to bring forward payments, and is also waiting for institutional funds to “re-engage” since they pulled out after police launched an investigation into alleged fraud by Elliot Lawless, founder of Elliot Group, and Nick Kavanagh, head of regeneration at Liverpool City Council. Both men were arrested in December. No charges have been brought.
Contractor Carey Group was on site at the 34-storey and 15-storey tower scheme at Salford’s Greengate, but exited the scheme last week amid rumours that the company was owed payment.
The Residence is Elliot Group’s sole Manchester scheme, with the developer mainly working in Liverpool.
A spokesperson for Elliot Group said in a statement: “Elliot Lawless has committed to inject the funds necessary to complete the superstructure with PJ Carey.
“The ongoing police investigation means there is no likelihood of raising further development finance until the investigation is complete and Mr Lawless is exonerated, as he expects to be.
“His only option is to inject short-term funding to keep the project afloat while responsibility for completing the scheme is mandated to another developer.
“The terms of the funding are close to being concluded and discussions are underway with a developer who is keen to step in.”
Once the funding is agreed, the developer plans to host an investor conference to seek investors’ approval for the appointment of a third-party developer, the statement added.
“We are confident that they will back this option but if not, the professional advice we are receiving is to put the scheme into administration.”
The statement said the “same approach and scenario holds for our Aura and Infinity schemes”.
The £100m Aura student scheme sits on the edge of Liverpool’s Knowledge Quarter, and the 1,000-apartment Infinity scheme is located on Leeds Street.
“The key is to ensure the schemes remain viable and can be delivered,” the statement said. “They’re great projects that will transform their immediate environs and deliver the returns we’ve previously been able to provide to our investors.
“Elliot Group has a 100 per cent track record of delivery and so its focus right now is on ensuring that these three schemes can be completed.”