Part of troubled Fortis Quay scheme in administrators’ hands
The SPV that controls one of four buildings within the Salford Quays residential cluster has collapsed after challenges around viability and a stand-off with investors caused the scheme to stall.
Begbies Traynor has been appointed as administrator over Furness Quay Phase 1 Ltd, the vehicle that holds a 999-year leasehold over a plot of land that contains the former Custom House office building.
Fortis Group, the developer behind the 900-home Fortis Quay project, had originally planned to strip the former Bruntwood office back to its concrete core and convert it into 44 apartments.
In 2017, all of the flats were bought off-plan with investors paying up to 50% of the purchase price. It is understood investors have paid around £12m into the project.
It later transpired that reusing the core of Custom House would make the scheme unviable, which prompted Fortis to rework its proposals.
The company lodged a revised application to knock down Custom House completely and build a 158-apartment, 20-storey new-build block known as Mariners Wharf.
A similar approach was taken at the neighbouring Furness House, which Fortis had also planned to strip back and convert. This element of the scheme would be known as Victoria Quay and comprise 178 flats.
Following the change of approach, Fortis sought to reach a compromise arrangement with the leaseholders in the Custom House scheme – now Mariners Wharf – according to administrators.
“However, these efforts proved to be unsuccessful. As such, the project has remained at an impasse and work has not progressed for several years,” said Asher Miller, joint administrator for Furness Quay Phase 1 Ltd.
The company’s directors Darren Mcclellan, Kieran Moore and Gareth Morgan all resigned in July. The sole director listed on Companies House is Carl Roland.
Miller added: “The administrators are officers of the court with a responsibility to the creditors as a whole, and our objective will be to work with the leaseholders to reach a solution that will break the current deadlock for all parties and provide the best possible outcome in these circumstances.”
While the redevelopment of the two former offices shows few signs of progress, Northill, the tallest element of Fortis Quay at 27 storeys, is complete.
Work on another element of the project, Amplify, was impacted by the collapse of contractor Beaumont Morgan earlier this year.
Amplify, which will provide 272 apartments once complete, was acquired by Clarion Housing Group’s development arm Latimer in 2018.
Concerning that the investors placed 50% deposits in a scheme which doesn’t have a blue chip developer behind it. And if i was placing 50% deposit into something then i would have to know the involved party personally or done some serious research on them…I’m assuming that the investors were probably naive foreign investors who were convinced by some slick marketing & PR. We need a list of directors of failed construction/development firms so that the next time they are involved in a scheme then it’s easier to look up their past performance…too many of them bankrupting schemes and moving onto to the next one…thankfully there is less of this in Manchester than other places but still not a good look reputationally.
By Anon
I feel sorry for anyone that has rented or bought an apartment in Northhill. I looked at a place there and the whole building is surrounded by derelict construction only accessible by a small construction road.
By Anonymous
Another mess of a scheme with a developer who clearly hasn’t the ability to deliver schemes of scale.
By Mikey