Developer of the blocked tower block Herculaneum Quay collapsed more than £ 23 million after being nearly £ 11m from ...

Developer of the blocked tower block Herculaneum Quay collapsed more than £ 23 million after being nearly £ 11m from ...

The developer of the blocked tower block, Herculaneum Quay, collapsed more than £ 23 million, having cost buyers almost £ 11 million, a new report revealed.

And an angry buyer who swapped contracts for his flat in the 16-story Dingle office, just weeks before he collapsed, was worried he might lose nearly £ 60,000.

The Lancashire physician is the latest investor to tell the ECHO about their anger over the collapse of Herculaneumco and the abandonment of work on its flagship tower.

It is one of several halting developments that have been making headlines in Liverpool in recent months and that have been featured in the ECHO.

The Herculaneum Quay tower seen from Dingle
The Herculaneum Quay tower seen from Dingle

Financial firm Lendy said she called the administrators to Herculaneum Quay for losing confidence in Herculaneumco's ability to complete the building.

The administrators say they are considering whether to finish or sell the building itself.

A director of developer Herculaneumco says the company did not know until the last minute that its lender was calling the administrators. And Kerry Tomlinson said he would fight "for the best solution" for investors who bought apartments there.

The 119-lane block was first commissioned by another developer in 2007, but stagnated during the recession.

The Mersey developer Primesite acquired it in 2013 through its company Herculaneumco and resumed its work. Flats were sold to buyers by planners while prime site ensured financing from Lendy.

General view of the Herculaneum Quay tower, off Royden Way
General view of the Herculaneum Quay tower, off Royden Way

The manager's report states that the company has raised £ 10.9 million in deposits from buyers.

But in June, Lendy called on the administrators Quantuma to Herculaneumco, "to protect the interests of investors".

Quantuma's first report on the collapse has now been released.

It says, "The construction was hit by numerous delays due to funding issues and other factors such as the weather."

It is said that on June 26, "a formal request for payment from Lendy to the company (Herculaneumco)" was issued.

Herculaneum Quay is halfway through when Denise and Ailish McNeil wait to see what happens next
Herculaneum Quay sits halfway as an investor Ailish McNeil, right, with her mother Denise, wait to see what happens next

And it is said that Quantuma's Simon Campbell and Andrew Watling were appointed as administrators the next day.

The report says that Herculaneumco has accumulated £ 10.9 million in buyer deposits and that the funding problems and weather were responsible for the collapse.

It states that total bank debt was £ 23.6 million, £ 12.7 million to Lendy and £ 10.9 million to investors.

The unfinished Herculaneum Quay Tower is estimated at only £ 8m.

The "latest victim" of the collapse speaks out

The Lancashire doctor, who wanted to remain anonymous, told the ECHO he was the "latest victim" of the Herculaneum Quay collapse.

The doctor said earlier this year that he had been shown a £ 235,000 flat that was almost finished – "It was almost done, except for a few floors and some soft furniture."

He asked for a price reduction and got the flat offered for £ 222,000. He made a deposit of £ 58,000 to secure it.

He agreed to buy the apartment in April through the real estate company Certa Invest, and exchanged contracts on June 5.

But on June 27, administrators were appointed who angered the doctor and feared for his money.

The doctor said he had talked to Primesite to say how angry he was that Herculaneumco had collapsed so soon after buying the apartment.

And he said, "I do not know what to do or what to say, it's very hard earned money.

"I can not save £ 60,000 in a year, it took years to save it."

The doctor has lived in the UK for decades. He said, "I could not believe that this could happen in this land, in my wildest dreams, all my confidence has passed."

Company boss says he will fight for investors' money

Herculaneumco and Prime Site Director Kerry Tomlinson, also a former director of Certa Invest, said, "The sudden and unfair appointment of an administrator at Herculaneumco Ltd was just as confusing and disturbing to us as it was to our investors.

"On June 13, we met Lendy personally in Portsmouth, where they told us that their platform would not be able to raise the funds they had promised in their credit facilities signed and closed on May 23, just weeks earlier.

"Lendy asked Herculaneumco Ltd to raise additional funds to cover this, and although disappointing news, we agreed in the interest of completing Herculaneum Quay.

"Neither we, Certa Invest nor any of our contractors had any idea of ​​the situation ahead of us until we were informed on June 27 at 11 o'clock."

Herculaneum quay seen from Dingle
Herculaneum quay seen from Dingle

Mr Tomlinson said her last communication with Lendy was on June 22, adding, "We can absolutely affirm that there has never been a hint of Lendy's plans to invite administrators, and we and our partners have been left completely in the dark ,

"Minutes after we were informed of the arrival of the administrators, we updated our exclusive sales agents, Certa Invest, with whom we have a very close relationship, and Certa Invest stopped all sales immediately.

"We can not comment on isolated cases, but of course neither Herculaneumco Ltd nor Certa would have sold to an investor if we could have predicted the situation that should be imposed on us."

A closeup of the Herculaneum Quay evolution
A closeup of the Herculaneum Quay evolution

Mr. Tomlinson said his company made an offer in July "that would have allowed all investors to get their flats" and said he would attend a creditor meeting next week.

And he added, "We want our investors to know that we are still working with our creditors and the administrators and will continue to fight for the best solution for them, and we are all in this development, and we will not give up "

Lender says it had no choice but to call administrators

Lendy is an online platform where people can invest money in real estate across the country.

His website lists "non-performing" £ 46 million in assets worth £ 93 million. The company says it is "no longer confident that borrowers will be able to repay the loan in these cases" and is taking steps to recover the capital.

Lendy spokesman said, "Lendy's primary responsibility is always to act in the best interests of our investors, based on the information we have at our disposal.

A look from within Herculaneum Quay where the ECHO visited last year

"It's important to emphasize that any decision to appoint an administrator will never be taken lightly.

"But in this case, having exhausted all other opportunities to lose faith in the developer's ability to compete within a reasonable time frame and within the developer's own cost budget, we had no choice but to manage to go.

"The liquidators were finally appointed for a breach of the credit facility entered into by the Borrower Company.

"Administrators are now working to maximize the return on our investors in this loan and we will keep our investors up to date as the administration progresses."

The administrator will investigate the collapse

The evolution at Herculaneum Quay, how it could look
A CGI, as the completed development at Herculaneum Quay looks like

Simon Campbell, director of Quantuma's business consultancy and co-manager of Hercelaneumco, said the company went into administration after "significant cost overruns and funding issues".

He said, "Since our appointment, we have worked with real estate broker Landwood Group and a number of other stakeholders to review the site in its current state and the value of the work needed to complete the development.

"We will then examine the possibilities to partially or completely complete the Herculaneum quay in its present condition or to effect an immediate sale.

"Our top priority is to maximize returns for all creditors in our dealings with the property, and we then have a duty to investigate how that company becomes insolvent and to pursue any resulting claims."

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