The development is part of a wider 900-home masterplan. Credit: via Igniyte

Fortis creditors owed £4.4m left in limbo 

Investors in a residential scheme at Salford Quays paid 50% deposits on apartments in 2017. More than five years on, work is yet to start. 

The project in question is one of four buildings that make up Fortis Group’s 900-home Fortis Quay development. 

Furness Quay Phase 1 Ltd, the vehicle that holds a 999-year leasehold over a plot of land that contains the former Custom House office building, was placed into administration last year. 

Investors in the project have paid £4.4m in deposits, according to administrator Begbies Traynor. 

The deposits were used to pay for the acquisition of the headlease from Furness Quay Ltd, a connected entity, by the Furness Quay Phase 1 SPV, an administrators report states. 

How much of their investment creditors will get back through the administration process depends on how much can be realised from the sale of the leasehold.  

The leasehold was last valued at around £2m and administrators are seeking an up-to-date valuation.

Fortis Group had originally planned to strip the former Bruntwood office back to its concrete core and convert it into 44 apartments.  

In 2017, all 44 flats were bought off-plan with investors paying up to 50% of the purchase price.  

It later transpired that reusing the core of Custom House would make the scheme unviable, which prompted Fortis to rework its proposals.   

The company lodged a revised application to knock down Custom House completely and build a 158-apartment, 20-storey new-build block known as Herreshoff, which was recently rebranded as Mariners Wharf.  

A similar approach was taken at the neighbouring Furness House, which Fortis had also planned to strip back and convert. This element of the scheme would be known as Victoria Quay and comprise 178 flats.  

Following the change of approach, Fortis sought to reach a compromise arrangement with the leaseholders in the Custom House scheme – now Mariners Wharf – according to administrators.  

This involved asking investors to convert their deposits into loans, an offer that they refused. 

In addition, investors were at one point offered repayment of 40p in the pound. This was also rejected. 

While the redevelopment of the two former offices shows few signs of progress, Northill, the tallest element of Fortis Quay at 27 storeys, is complete.   

Work on another element of the project, Amplify, was impacted by the collapse of contractor Beaumont Morgan last year.  

Amplify, which will provide 272 apartments once complete, was acquired by Clarion Housing Group’s development arm Latimer in 2018. 

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Great news, every construction at the moment is for private owners, it’s about time that Salford council stepped in and bought land to develop for its tax payers.

By Mike

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