star dust
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Post by star dust on Apr 13, 2018 10:54:38 GMT
Only had a quick skim of the realisations statement (pdf) but two things don't make sense to me. a) the worst case column contains £10k of costs associated with selling the freehold, but zero realisation from the freehold as the worst case assumes ground rents have been abolished. Hence costs appear to have been over stated by £10k There's another update and I think that £10k has been removed and there is a revised pdf with the figures, however, I didn't see the first one.
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eeyore
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Post by eeyore on Apr 13, 2018 11:06:12 GMT
Does anyone have any insight on the value of the ground rent element in the freehold in the light of future legislation? The value of the freehold in the 'best case' scenario is substantial at £xxxk, but if legislation is going to reduce that to zero at some point in the future, why would anyone pay such a substantial sum now when the value may shortly disappear? The government has indicated that it is not considering retrospective action on existing ground rents (at least for now), so providing these units sell before the law changes they will continue with annual ground rent charges. The government has said primary legislation is needed, so given the absence of current comment in the media, my guess is it won't be before the Aug/Sept completion dates for these sales. Thanks for that! So the next worry is that sales of leases to the "end user", the ultimate payer of the ground rent, will freeze on such legislation being tabled until the legislation takes effect. Oh, what interesting times we live in! PS: Sorry Administrators, I didn't realise that the confidentiality requirements blocks us from using the monetary values - on some occasions that's going to make discussion somewhat problematic?
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johni
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Post by johni on Apr 13, 2018 11:19:53 GMT
The government has indicated that it is not considering retrospective action on existing ground rents (at least for now), so providing these units sell before the law changes they will continue with annual ground rent charges. The government has said primary legislation is needed, so given the absence of current comment in the media, my guess is it won't be before the Aug/Sept completion dates for these sales. Thanks for that! So the next worry is that sales of leases to the "end user", the ultimate payer of the ground rent, will freeze on such legislation being tabled until the legislation takes effect. Oh, what interesting times we live in! PS: Sorry Administrators, I didn't realise that the confidentiality requirements blocks us from using the monetary values - on some occasions that's going to make discussion somewhat problematic? But now you have reached 50 posts you can join DD central and possibly discuss these issues
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Post by charlata on Apr 13, 2018 11:20:31 GMT
Something doesn't add up.
The contract to complete the build when we started was £8***. The development has moved on a lot, and is now 85% complete. Yet the contract to complete is only ~£50k less than before. In other words, it's going to cost nearly as much to do the 15% that remains as it has cost to get this far. I can't escape the conclusion that either the first contract was too low, or the second contract is too high.
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IFISAcava
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Post by IFISAcava on Apr 13, 2018 11:29:42 GMT
Something doesn't add up. The contract to complete the build when we started was £8***. The development has moved on a lot, and is now 85% complete. Yet the contract to complete is only ~£50k less than before. In other words, it's going to cost nearly as much to do the 15% that remains as it has cost to get this far. I can't escape the conclusion that either the first contract was too low, or the second contract is too high. or the percentages are wrong
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IFISAcava
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Post by IFISAcava on Apr 13, 2018 11:31:20 GMT
I would expect no less from MT but I've just read the update and I am impressed and reassured. I note that Bollington is the next one for the Administrators to get their teeth stuck into. Even when defaults strike on MT, the situation always seems to be under control with a good recovery rate and no skeletons start walking out of the cupboard. I have not changed my early opinion which was that MT is a well run, diligent, king among platforms. And a reminder to those investors who have a little tucked away in the defaulted Prestbury loan - the sale completion date of April 17 is drawing very near so a repayment to look forward to in the very near horizon. That's wot many said about COLL. Its what GeorgeT said about COLL!
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Post by mrclondon on Apr 13, 2018 11:44:16 GMT
Something doesn't add up. The contract to complete the build when we started was £8***. The development has moved on a lot, and is now 85% complete. Yet the contract to complete is only ~£50k less than before. In other words, it's going to cost nearly as much to do the 15% that remains as it has cost to get this far. I can't escape the conclusion that either the first contract was too low, or the second contract is too high. or the percentages are wrong Or that elliotn was correct when he implied (in reply to me) that the build costs include the interest and capital of the additional finance, i.e. the stated costs to complete are made up of ( build cost to complete + finance cost ) * 2 so allowing the additional finance to be treated as a quasi-first charge ahead of the MT legal first charge. For whatever reason MT would prefer we are not aware of how this additional finance is being achieved, and are seemingly comfortable with any hit on their reputation regarding the lack of transparency.
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snowmobile
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Post by snowmobile on Apr 13, 2018 13:01:00 GMT
or the percentages are wrong Or that elliotn was correct when he implied (in reply to me) that the build costs include the interest and capital of the additional finance, i.e. the stated costs to complete are made up of ( build cost to complete + finance cost ) * 2 so allowing the additional finance to be treated as a quasi-first charge ahead of the MT legal first charge. For whatever reason MT would prefer we are not aware of how this additional finance is being achieved, and are seemingly comfortable with any hit on their reputation regarding the lack of transparency. The text does explicitly state that the cost of finance is included in the build costs. At what cost we aren't told. It also doesn't explicitly state what level of security has been agreed in principle with the other lender I can't imagine they would be happy to accept anything less than the quasi-first charge. Not transparent I agree. I wonder why it wasn't considered appropriate to invite MT lenders to finance the build through to completion. I would have thought this would be the most cost effective and lenders already have a keen interest in ensuring this completes.
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johni
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Post by johni on Apr 13, 2018 13:46:51 GMT
Maybe the lack of investors recently. They may have got finance at less than 10% which has been the floor for rates on MT.
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Post by brummiefred on Apr 13, 2018 14:35:28 GMT
As the interest is included in the 'Build costs' could it be that the Contractor has been asked to submit a price based on a single bullet payment on completion. I know from experience that a well known developer in the Midlands asked this of me for a large infrastructure scheme of industrial units.
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agent69
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Post by agent69 on Apr 13, 2018 15:22:46 GMT
Does anyone have any insight on the value of the ground rent element in the freehold in the light of future legislation? The value of the freehold in the 'best case' scenario is substantial at £xxxk, but if legislation is going to reduce that to zero at some point in the future, why would anyone pay such a substantial sum now when the value may shortly disappear? my guess is it won't be before the Aug/Sept completion dates for these sales. Build completion in August! Now where have I seen that before?
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Post by jamesp on Apr 14, 2018 22:18:00 GMT
my guess is it won't be before the Aug/Sept completion dates for these sales. Build completion in August! Now where have I seen that before? I'd guess that some of the buyers are going to be very unhappy if they aren't ready in time for the academic year so they need to be making a big effort to meet that deadline.
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Post by mrclondon on May 1, 2018 11:42:25 GMT
The administrators proposals document is now available at Companies House.
Summarising what I think are the main points:
- Document dated 13th April 18, issued to creditors on 17th April 18 - Loans to Boll****** and Plymouth 1 are cross guaranteed, and the cross-guarantee takes precedence over the 2nd charge loan on Plymouth 1 (para 6) - Site was purchased Jan 2017 for £331k (para 3) - Some units have exchanged on a leasehold basis with longstop dates of Sept 2018, administrators still establishing actual position (para 3 & 5) - An offer was received for the freehold shortly before the administration, administrators reviewing this (para 5) - Options are complete build and sell units + freehold, or sell as is (para 4) - Four week due diligence study commissioned from a firm of construction consultants and chartered surveyors re the build out option. Their report currently being considered by the administrators (para 5) - Administration fee estimated at £151k (para 9) plus costs
(Corresponding report for Boll****** is also now available at CH)
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james21
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Post by james21 on May 1, 2018 11:55:53 GMT
The administrators proposals document is now available at Companies House. Summarising what I think are the main points: - Document dated 13th April 18, issued to creditors on 17th April 18 - Loans to Boll****** and Plymouth 1 are cross guaranteed, and the cross-guarantee takes precedence over the 2nd charge loan on Plymouth 1 (para 6) - Site was purchased Jan 2017 for £331k (para 3) - Some units have exchanged on a leasehold basis with longstop dates of Sept 2018, administrators still establishing actual position (para 3 & 5) - An offer was received for the freehold shortly before the administration, administrators reviewing this (para 5) - Options are complete build and sell units + freehold, or sell as is (para 4) - Four week due diligence study commissioned from a firm of construction consultants and chartered surveyors re the build out option. Their report currently being considered by the administrators (para 5) - Administration fee estimated at £151k (para 9) plus costs (Corresponding report for Boll****** is also now available at CH) Good work, thank you could you sumarise Boll***** please?
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Post by mrclondon on May 1, 2018 12:00:48 GMT
[...] (Corresponding report for Boll****** is also now available at CH) Good work, thank you could you sumarise Boll***** please? Already done - I posted both summaries seconds apart !
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