Property Loan - H*** Road - Birkenhead (2175354900) DEFAULT

I consider this renewal the right time to get out. In April "Development Work has commenced"

6 months later: Site has now been cleared and prepared for ongoing development.

There's an old ICI industrial site near me that was a major chemical plant for many decades and in not far over 6 months they've cleared the site and put umpteen new houses up! The LTV ratio is one of the more tempting on FS but this may well turn into another typical Funding Secure Saga.

26/10/17 Update
The old buildings have been demolished and the site fully cleared and levelled. As this is a renewal of a loan, rather than additional borrowing, we have not commissioned a new survey.

fundingsecure  Can we have a photograph (exif data for date taken retained) each time you write this about a development loan please? My doctor says I am suffering from Whitehaven Syndrome, which gives me the twitches.

Yea, it's a common disease these days, Whitehaven syndrome!

Seriously though, it takes very little work to get photo updates of all these developments and it should be absolutely standard. Just a few pics on the phone and shipped of to FS in a twinkle of an eye.

Given the backlash of Whitehaven, I'm surprised we even need to ask for them to be honest.

As mentioned earlier in the thread, FS are providing a number of loans to this borrower and a couple of sister SPVs (see thread Are all the Liverpool / Birkenhead loans linked? )

The Sept 16 VR states that phase 1 is for 10 flats in two blocks, and phase 2 and for an additional 18 flats. It references the approved outline planning permission for phase 1 but the surveyor states he was unable to locate a planning application/decision for phase 2. Well, the surveyor clearly didn't look hard enough for the phase 2 planning application which was submitted several months before he wrote the VR, but to be fair it is registered under a slightly different address. (Links to both planning applications are in DD Central).

Phase 1 was approved with conditions in Jan 12, phase 2 with conditions in Oct 16.  I am though unable to find any associated planning applications/submissions for the discharge of the conditions needed before the development can start for real.

But since the original Oct 2016 loan was to develop a site the borrower already owns, and he has not in fact developed the site beyond preparatory clearing, why can he not simply repay the loan?

I would suggest they currently have insufficient funds to pay it back, and even less so to develop it. There may or may not be a buyer lined up, that will probably be answered in 6 months time.

Not for me.

It's taken a little longer than 6 months, but the question has been answered - this loan has now been defaulted.  My reading of the valuation leads me to believe the LTV is based on the (then-)current state of the property, rather than relying on the development work.  This means we should be reasonably safe, assuming the valuation is in any way accurate. Right?


Right....?