Agreements have now been reached on all four Elliot Group property schemes, three in Liverpool and one in Salford, which collapsed into administration following Elliot Lawless’s arrest. Tony McDonough reports
Original investors of a £70m scheme to build a hotel in Liverpool will take over the project after it collapsed into administration.
And the deal for the 306-bed development in Norfolk Street in the Baltic Triangle means agreements have now been reached for all four of the Elliot Group schemes that fell into administration following the arrest of company founder Elliot Lawless in 2019.
However, deals to dispose of two other schemes, the £250m Infinity project in Liverpool and the £70m, 300-apartment The Residence in Salford, may yet face a challenge. Legacie developments, also based in Liverpool, has struck an agreement with administrators David Rubin & Partners to take on the projects.
The original investors of both projects, who had hoped to take them on themselves, were thwarted by a better offer from Legacie. The agreement has to be ratified by the courts and those investors may seek to block it. In contrast, administrators for the Norfolk Street scheme, HBG Insolvency, expect the ratification of their deal by the courts will be a formality.
In October 2020, a deal was agreed with David Rubin & Partners, for a consortium of the original investors in the fourth scheme, Aura, located close to the Baltic Triangle, to take over the development.
Mr Lawless was arrested in December 2019 as part of the wider Operation Aloft probe into deals between property developers and Liverpool City Council. He was released without charge shortly afterwards.
The High Court later refused a police application to extend his bail and declared the search warrant and the search of his home unlawful. The police subsequently agreed to pay Mr Lawless’s legal fees and he continues to maintain his innocence.
However, the fallout from the arrest rocked investor confidence, causing the collapse of the four schemes. He says this made it impossible to bring in external funding to complete them.
Me Lawless said on Thursday: “When my schemes were placed in administration I made a promise that I would work ceaselessly to help secure each site’s sale and protect the interests of investors, so I am delighted that my final stalled scheme is to be acquired by its original investors.
“The process, as with the other administrations, has been handled by a third party under strict rules and I sympathise with investors whose bids for The Residence and Infinity weren’t successful.
“It has not been easy but with flexibility and good will on all sides the administrators have been able to ensure that all of my stalled projects will now be placed in the hands of new owners and move forward to completion.
“What this latest deal reinforces is that my projects were always very good schemes in prime locations. I’ll take considerable satisfaction from seeing them completed.
“If you take a look at the outstanding job done by the investors who bought Aura in Liverpool, for example, you can see that the original vision for each project can still be delivered in the right hands.”
Residence investors will receive a dividend once the Legacie deal completes but will not get back their deposits in full, administrator David Rubin told Place North West earlier this week. He said: “I am saddened that the investors didn’t make the best bid. They deserved to buy it more than anyone else.”