Jump to content
House Price Crash Forum

Developers In Trouble


Mr Mephisto
 Share

Recommended Posts

  • Replies 1.3k
  • Created
  • Last Reply

Top Posters In This Topic

Top Posters In This Topic

Posted Images

Are you seriously saying to me the first time you heard about director guarantee was in 2007? Seriously?

Director's Guarantees were the norm from the late 90's in my experience.

May be that in the case of the likes of MH and others that banks were falling over themselves to do business with these guys and PG's were refused by the directors so borrowings were geared up against asset values.

Link to comment
Share on other sites

Director's Guarantees were the norm from the late 90's in my experience.

May be that in the case of the likes of MH and others that banks were falling over themselves to do business with these guys and PG's were refused by the directors so borrowings were geared up against asset values.

Easily from the late 90. I've talked to my dad about this. He's been involved in several food based companies, since retired. He said Northern pretty much insisted on them. This was for smallish companies (50-100 employees) with good trading records going years back.

It's the way it should be, speculation with limited liability fallback isn't what limited liability was designed for.

Guarantees were on the borrowing, certainly not on the asset value.

Edited by 2buyornot2buy
Link to comment
Share on other sites

Easily from the late 90. I've talked to my dad about this. He's been involved in several food based companies, since retired. He said Northern pretty much insisted on them. This was for smallish companies (50-100 employees) with good trading records going years back.

It's the way it should be, speculation with limited liability fallback isn't what limited liability was designed for.

Guarantees were on the borrowing, certainly not on the asset value.

I can say that they were never mentioned to us until around 2006. I will ask around but I don't believe they were in the property game, in NI before that. For other start up companies in other sectors, perhaps, but I have no experience of that.

In my view the bank should not lend on a project if they feel they need them. this is exactly what inflated the prices so much as the banks were lending against the mythical wealth of the individual rather than looking at the value of the asset. lower the LtV if they are concerned and by all means let the borrower put in more money. I have no issue with that.

In 2006 I watched as people, who I knew had nothing behind them were buying land at £25m. What good were PG's. The guy had never developed before, he was a plumber prior to that. The guys who had the money couldn't understand it. To me the introduction of PG's to make speculative investment stack up was the downfall of the market.

In over 20 years of this game I can say that we were never asked for them until 2006 and thankfully we passed on the offer and the seemingly unlimited credit that came with it. I am not sure what if anything the bank (now tax payer) got in the PG from the plumber.

Link to comment
Share on other sites

I can say that they were never mentioned to us until around 2006. I will ask around but I don't believe they were in the property game, in NI before that. For other start up companies in other sectors, perhaps, but I have no experience of that.

In my view the bank should not lend on a project if they feel they need them. this is exactly what inflated the prices so much as the banks were lending against the mythical wealth of the individual rather than looking at the value of the asset. lower the LtV if they are concerned and by all means let the borrower put in more money. I have no issue with that.

In 2006 I watched as people, who I knew had nothing behind them were buying land at £25m. What good were PG's. The guy had never developed before, he was a plumber prior to that. The guys who had the money couldn't understand it. To me the introduction of PG's to make speculative investment stack up was the downfall of the market.

In over 20 years of this game I can say that we were never asked for them until 2006 and thankfully we passed on the offer and the seemingly unlimited credit that came with it. I am not sure what if anything the bank (now tax payer) got in the PG from the plumber.

Must ask some of the other LL people on the main board. Director guarantees have been standard for decades. I've only been involved in LL since 2002, haven't had to borrow until recently but I know with my bank it was always required. Property speculation must be a special case .

20 years isn't that long really, I would have expected you to have come across them.

Link to comment
Share on other sites

  • 1 month later...

Not really a housing developer

Building firm Mivan ceases trading

BBC Link

Mivan, one of Northern Ireland's best known construction companies, has ceased trading.

Mivan: Construction firm collapse to cost small creditors over £5m

http://www.bbc.co.uk/news/uk-northern-ireland-26576171

A statement of affairs show that Mivan creditors include a Belfast shipping firm owed more than £400,000 and a timber merchant owed almost £150,000.

It is unlikely that any of that money will be paid.

The firm's largest creditor was Danske Bank, which was owed almost £10m.

The bank is only likely to recover about £1m of that.

Link to comment
Share on other sites

  • 3 weeks later...

NAMA sell entire NI portfolio http://www.bbc.co.uk/news/uk-northern-ireland-26880492

Good news or bad news? Certainly gets NAMA off the hook but surely the yanks will want to carve up asap for a return?

They will want the best return they can get, not just the quickest. There will be a mixture of sell off and manage and build out. At lease it will be business people that he borrowers will be dealing with who will make business decisions.

Link to comment
Share on other sites

  • 3 months later...
Husband and wife developers are disqualified from doing business

http://www.belfasttelegraph.co.uk/business/news/husband-and-wife-developers-are-disqualified-from-doing-business-30409871.html

Husband and wife Kieran Paul (51) and Jacqueline Burns (49) of Crieve Court, Newry, were disqualified for seven years and two years respectively following their conduct as directors of construction and civil engineering firm KB Developments Limited.

The firm entered administration in August 2011 owing £2m.

Mr Burns was found to have permitted the firm to lodge company funds to a non-company bank account in the company name, putting them beyond the reach of a secured creditor.

Mrs Burns was said to have allowed herself to be recorded as a director without undertaking the duties the role entailed.

Link to comment
Share on other sites

http://www.bbc.com/news/uk-northern-ireland-28163891

Belfast Office Properties posts £143m loss

The main Northern Ireland company of Paddy McKillen, the high-profile property developer, made a loss of £143m in 2013.

The large loss at Belfast Office Properties was due to a write-down in the value of its properties.

Almost all Northern Ireland commercial property firms have had to write down the value of their investments.

This has been in recognition of the impact of the property crash.

Belfast Office Properties owns the Ards shopping centre and the Waterfront Plaza office block in Belfast.

It also controls the Forge shopping centre in Glasgow, which is probably its most valuable asset.

Most of the write-down appears to relate to the Forge. A note in the accounts states that the Forge Limited Partnership made a loss of £106m in 2013.

The write-down means that the firm's liabilities now outweigh its assets by £153m.

The firm has £221m of loans from Ulster Bank and Bank of Ireland, which are held on a demand basis.

The accounts state that the directors expect the loans to be renewed and adds that they are in discussions with other investors and lenders.

Mr McKillen has been involved in a number of high-profile legal cases, including one to retain Claridges hotel.

He co-owns Belfast Office Properties with the County Tyrone developer Padraig Drayne.

Link to comment
Share on other sites

  • 1 month later...
Iris Robinson-linked developer Ken Campbell in debt deal

http://www.bbc.co.uk/news/uk-northern-ireland-28689091

Businesses owed money by a property developer who lent Iris Robinson £25,000 to help her lover set up a cafe have received just 8p for every £1.

Ken Campbell, who is from Saintfield, County Down, traded as J&K Campbell. He began insolvency proceedings against bankruptcy in 2011, applying for an individual voluntary arrangement (IVA).

An IVA is a deal between a debtor and their creditors, by which part of the debt is written off and the outstanding money repaid over five years.

A letter sent on Mr Campbell's behalf last week has been seen by the BBC. It said Ken Campbell's debts totalled £1.7m.

The letter also revealed that the company that supervised the IVA was paid almost £50,000 for its work. It also stated that this company was now "pleased to be in a position to pay a dividend of 8p in the pound to creditors whose claims are neither secured nor preferential".

Because J&K Campbell was held personally rather than incorporated as a limited company, Mr Campbell was liable for its debts.

Link to comment
Share on other sites

Directors banned for racking up debts of millions

http://www.belfasttelegraph.co.uk/business/news/directors-banned-for-racking-up-debts-of-millions-30509596.html

The Department of Enterprise, Trade and Investment handed a seven-year disqualification to Stuart Andrew Jackson (34) of Glengall Lane, Ayr in Scotland in respect of his conduct as a director of EASSDA Limited, which was a property development firm based on the Antrim Road in Templepatrick.

The company went into administration in November 2009 with estimated total assets of £11.84m, liabilities to secured creditors of £28.69m, liabilities to preferential creditors of £17,833, liabilities to unsecured creditors of £4.24m and an estimated deficiency to creditors of £21.12m. Proceedings are continuing against three other directors.

Mr Jackson accepted authorising intercompany payments to EASSDA Ireland Limited, leaving an inter-company debt of £4.9m which cannot be repaid.

Link to comment
Share on other sites

  • 2 weeks later...
  • 2 months later...
  • 2 weeks later...
  • 1 month later...

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...
 Share

  • Recently Browsing   0 members

    • No registered users viewing this page.




×
×
  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.