Options weighed up for Signature’s stalled Preston hotel
Administrator Kroll is torn between marketing the unfinished development for sale or taking out a loan to complete the 65-bedroom scheme before selling it on.
Kroll was appointed as administrator over Signature Living Preston in August. The company owns the leasehold of Preston’s former post office building on Market Street, having acquired it from Preston City Council.
The company planned to convert the building into a hotel named after former football manager Bill Shankly, a sister venue to the Shankly Hotel in Liverpool.
Kroll is in talks with agents over how best to market the property for sale and is weighing up whether to sell the unfinished building or complete the project and appoint an operator so the asset can be sold as a going concern.
In a report updating creditors, Kroll said it had been appointed as administrator by development finance provider Lyell Trading.
Lyell had lent Signature £12m for the £15m redevelopment of the grade two-listed building, according to the report
However, the developer fell behind on repayments due to project delays and cost overruns, Kroll said.
Signature’s failure to meet its loan repayments prompted Lyell to appoint Kroll in a bid to recover its cash.
Kroll predicts the sale of the scheme will generate sufficient funds to pay “a distribution” to Lyell and SW Construction (No.2) Ltd, which is owed £4m.
However, unsecured creditors owed £6.8m in total may miss out.
Signature Living Preston was one of four group companies to go bust in August.
The others were Loyola Hall, the company behind the Rainhill Hall Hotel in Prescot, as well as Signature Eden and Signature Living Lifestyles.
In previous months and years, several Signature companies have faced financial difficulties.
In April 2020, Signature Living Hotel and Signature Shankly went into administration as the Covid pandemic hit, with various other ventures then falling by the wayside.
These included a boutique hotel scheme in Manchester’s Castlefield, where consent was secured in partnership with Iliad. The project was bought this summer by Salboy.
