Investors have struck a deal to complete the 16-storey project in Liverpool which stalled after its developer entered administration last year, owing £24m to creditors.
Administrators Quantuma were appointed last year at Herculaneumco, the special purpose vehicle behind the project headed by Kerry Tomlinson of Primesite. Peer-to-peer loans platform Lendy appointed Quantuma in June last year to “protect the interests of investors”, although this was challenged by Tomlinson, who said the company was “shocked” administrators had been called in.
At the time of administration, Herculaneumco owed unsecured creditors around £12m, while a further £12m was owed to Lendy.
Quantuma has now concluded a deal which transfers the long leasehold of the building to a special purpose vehicle controlled by investors, allowing the project to be finished.
Although the building is largely structurally complete, it is expected it will take 12 to 18 months to finalise building work. The 119-apartment scheme was originally due to hand over by the end of 2017.
Primesite is continuing to advise investors on the completion of the project.
The most recent administrators’ report, dated from February this year, reveals there had been “other offers” received on the development but had been rejected by Lendy as being not of “sufficient value”. A sale of the building would likely have led to investors losing their deposits, where buyers paid between 50% and 80% of the sales value.
Kerry Tomlinson of Primesite said: “This positive update is a result of nine months of work and collaboration by a consortium of original investors in the project, including ourselves. It would not have been possible without the investors’ invaluable input – they were instrumental in developing and implementing this well-thought-out plan.
“Primesite Developments will now be advising the consortium of investors on the project. We’d like to thank all of the investors for their efforts, support, and patience as together we meticulously explored the options to allow us to see construction of Herculaneum Quay through to completion.”
Apartments are still being advertised for sale via website Certa Invest.
Simon Campbell, joint administrator and director at Quantuma, said: “This deal has been delayed due to the complexity of drawing together the interests of the landlord, secured creditors and over 100 investors. Importantly, investors now have control over the development and have the prospect of achieving a fully-refurbished property as originally intended.
“Our team has worked tirelessly to rebuild the trust of all stakeholders, and I would like to thank the many professionals who came together to drive this deal through to completion. We should see development work re-commence shortly.”