Funders owed £40m by DeTrafford vehicle
Maslow Capital and Daiwa Capital Markets Europe are hoping to recoup money they lent to a vehicle behind the 138-apartment St George’s Gardens in Manchester.
Maslow appointed BDO as administrator over the company in September after DeTrafford St George’s Gardens fell behind on its loan repayments.
A statement by BDO published on Companies House says that Maslow is owed £11m on a loan taken out in 2019.
Meanwhile, Daiwa is owed £29.1m under the terms of its security in relation to a cross guarantee provided by DeTrafford Sky Gardens, the vehicle behind the neighbouring 109-apartment Sky Gardens, which is not in administration.
Both Maslow and Daiwa hold fixed and floating charges over DeTrafford St George’s Gardens, according to the administrator.
Maslow’s loan, which is cross guaranteed against the collapsed DeTrafford City Gardens, predates Daiwa’s, so the former will be ahead of the latter in the queue when it comes to repayment.
The investors who paid deposits on the 11 unsold apartments are owed around £200,000.
Three of these, owed a combined £35,000, hold unilateral notices over the apartments that were registered prior to Maslow’s loan. This means the investors’ claims for repayment take priority over Maslow’s.
BDO anticipates there will be sufficient realisations to pay a “return” to both Maslow and the UN1-holding investors.
Unsecured creditors involved in the scheme are owed £4.2m, the majority of which – £3.5m – is owed to another group company, DeTrafford and Palatine Estates.
Administrators predict there will be insufficient realisations to make a distribution to unsecured creditors.
Construction of the 11-storey St George’s Gardens block completed in late 2020 and 127 of the one- and two-bedroom apartments have been sold.
BDO has confirmed that it would be seeking buyers for the remaining 11 apartments, a ground-floor commercial unit, and the head lease.
Together, these assets are worth an estimated £3.6m.
At the time of BDO’s appointment, DeTrafford St George’s Gardens had £2 in the bank, according to BDO’s report.
