The developer has finalised a deal with investors to relinquish the freehold of its £100m student scheme in Liverpool’s Knowledge Quarter, bringing the stalled project out of administration and enabling it to complete.
Under the agreement, a consortium of investors that had helped to fund the scheme prior to its administration in March will be gifted the freehold title of Aura, a 1,000-bedroom student accommodation scheme.
In addition, a neighbouring piece of land will be transferred from Elliot Group to the consortium to guarantee that the investors can progress the scheme without “hindrance” from the developer, it said in a statement today.
The company’s founder Elliot Lawless added: “My motivation throughout the administration process was to protect my investors and so I’m pleased with the outcome.
“These are people whose backing enabled me to deliver more than 2,500 new homes in Liverpool and I wasn’t about to leave them high and dry.”
Under the deal, Elliot would build out the proposed hotel element of the Aura scheme, but the consortium would develop the rest.
“What I’ve done is hand over the profit element to the consortium so that, not only is their core investment protected, but they can share the surplus [monies] a successful completed project will deliver,” Lawless said.
“We’ll be neighbours now and I’ve set the tone in terms of goodwill so that we can work together to ensure that both schemes are completed.”
Vermont was the main contractor on Aura, but work has stalled on the project since the beginning of this year, after Lawless was arrested on 18 December along with Nick Kavanagh, head of regeneration at Liverpool City Council, on suspicions of fraud.
Both men were released on bail and no charges were brought, although a police probe is still ongoing. In April, the High Court in London ruled that a search by Merseyside Police of Lawless’ home in December was unlawful, and the police agreed to settle the claim while continuing its investigation.
During months of uncertainty following his arrest, Elliot in March appointed administrators at David Rubin & Partners for three of its schemes – Aura, as well as the £250m Infinity residential scheme in Liverpool city centre, and the £70m The Residence apartment project in Salford.
Lawless will seek similar deals with investors for The Residence and Infinity following the Aura disposal, he said.
Anna Doeff, whose company Mewstone Ridges is Elliot’s single largest investor in Aura and a member of the consortium, was quoted by Elliot as saying: “This is the best possible deal we could arrive at.
“Credit is due to Elliot Lawless for working so hard to find a solution that protected our interests. We’re now just looking forward to getting the builders back on site and delivering a scheme of which we can all be proud.”
The joint administrators Cooper and Rubin added: “This was a complicated procedure that could not have been resolved without the collective buy-in and efforts of Elliot Group and the investor consortium.”
A date to restart construction on site has yet to be agreed.