Salford-based ground rents investor Birch Park Investments has acquired the freehold of the 391-bedroom One Islington Plaza for £1.9m.
The deal will also see the scheme’s original investors take over the management of the nine-storey Knowledge Quarter building, ensuring they keep hold of their leases. The investors also made a £1.6m bid for the freehold but lost out to Birch Park.
“This is an extremely good deal for investors,” Quantuma Advisory managing director Simon Campbell told Place North West.
In January, Quantuma Advisory was appointed to handle the administration of One Islington Plaza, the special purpose vehicle behind the Liverpool development.
The sale of the student scheme was aimed at recovering some of the £4.3m the SPV owed to lender Route Finance. Colliers marketed the property for sale and Addleshaw Goddard advised on legal matters.
Incorporated in 2015 by Chris Saggers and Alan Lovett, One Islington Plaza appointed contractor Ridgemere to build the £20m student scheme.
Work was scheduled to complete in time for the 2018/19 academic year but was delayed by 12 months before the scheme finally completed in October 2019.
Apartments were sold to individual investors and then leased back by the developer to oversee rentals, with the promise to investors of an 8% net return over three years, according to an administrators’ report.
However, the developer was unable to deliver on its promise due in part to the impact of the Covid-19 pandemic on the number of students seeking to rent apartments in the city, the report added.
Prior to Quantuma’s appointment, Grangeford, another ground rents investor, lodged a £1.44m bid to buy the building.