Fox Street Village developer collapsed owing £10m
The developer behind the troubled scheme in Everton owed investors nearly £10m when administrators were called in last month, newly published documents have revealed.
The company owed £9.9m to its creditors including more than £6.5m to investors into the 400-apartment scheme in north Liverpool, and the developer’s administrators said these investors were “unlikely” to receive a penny following its collapse.
Headed up by Gary Howard, according to Companies House, Fox Street Village Limited is the SPV behind the apartment scheme on Great Homer Street, which had an original completion date of winter 2018 but still remains unfinished.
Kerry Tomlinson of Primesite was also formerly listed as a director at the company but resigned in February 2017.
The site fronting Fox Street was bought by the company in late 2015 for £1.35m by the company, and construction started in 2016. The following year, 90% of the units had been sold and four of the five planned blocks had been completed.
However, the scheme has run into difficulty with the last block remaining incomplete, and earlier this year, the project was hit with an enforcement notice by Liverpool City Council, which has raised concerns the apartments were “poorly finished” and represented a fire risk.
A report to the council claimed the scheme “fails to meet the minimum standards expected of residential development” with issues including whether the land below had been properly remediated; fire safety issues including the cladding; and a lack of basement car and cycle parking, which was part of the original planning permission but has not been implemented.
Investors in the unfinished block, Block D, are owed £5.9m, while other investors in completed Blocks A, C, and E are owed £572,000.
These investors are from across the UK and around the world with individual buyers owed as much as £759,000. Overseas buyers come from Singapore, Kuwait, Ukraine, United Arab Emirates, Thailand, Hong Kong, Nigeria, Sweden, and Greece; most of these are owed around £45,000 each with numerous other buyers owed six-figure sums.
HMRC is owed £2.7m and also looks unlikely to receive any money, while trade creditors are owed more than £750,000. Liverpool City Council is counted as a trade creditor and is owed £619,500; like the other creditors, the council is “very unlikely” to receive a penny from Fox Street Village Limited.
LSH has been appointed to find a buyer for the unfinished block, which is valued at around £500,000. The overall value of the development of all five blocks is estimate at £3.5m.
According to documents on Companies House, the administrator was been appointed at the behest of PH Invest, a mortgage finance company based in London, and headed up by UAE-based director Paul Hawkins. PH Invest counts as a secured creditor and is owed £1m.
The directors of Fox Street Village Limited are yet to provide a statement of affairs outlining its financial position at the time of its collapse. Fox Street Village Limited’s solicitor which dealt with the sales of all the apartments also entered administration, having collapsed in September 2018. The company also had a client account with EAD.
Gary Howard’s other development company, Lin Mari Developments, continues to trade, but Lin Mari Construction, also headed up by Howard, was liquidated in May owing its creditors £1.3m, including nearly £1m owed to HMRC.