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Developers In Trouble


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http://www.wcopeland.co.uk/index.html

Had heard that this developer had ceased trading. Not sure how big they were - quite active in Ards / Down area. One of their developments was Ballycullen Halt - just one apartment block was completed and the the site is now appears mothballed.

From the amateur-ish web-page they possibly weren't that big a concern. Judging from what has been written on the home page they are pretty bitter toward the banks.

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I see the BBC have the admin report on some of the Kennedy Group companies:

http://www.bbc.co.uk/news/uk-northern-ireland-12021105

Basically all these companies were contractors doing work for the development side of the Kennedy business (mainly JVs with the properly rich Jennings brothers).

When that work dried up they tried to compete in the general market, which was always going to be a losing battle. Bank of Ireland were turning the screw on the overdraft and finally pulled the plug in October.

The report doesn't mention how much BoI is owed but it does say that the contracting business is owed "significant amounts" from other Kennedy Group companies which could mean more pain ahead if the adminstrator hard balls it.

The group has made operating losses in the past two years.

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I see the BBC have the admin report on some of the Kennedy Group companies:

http://www.bbc.co.uk/news/uk-northern-ireland-12021105

Basically all these companies were contractors doing work for the development side of the Kennedy business (mainly JVs with the properly rich Jennings brothers).

When that work dried up they tried to compete in the general market, which was always going to be a losing battle. Bank of Ireland were turning the screw on the overdraft and finally pulled the plug in October.

The report doesn't mention how much BoI is owed but it does say that the contracting business is owed "significant amounts" from other Kennedy Group companies which could mean more pain ahead if the adminstrator hard balls it.

The group has made operating losses in the past two years.

Not good.

Cant pay or wont pay?

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  • 2 weeks later...

BBC have mopped up a few recent insolvency reports.

http://www.bbc.co.uk/news/uk-northern-ireland-12131587

I've had a look atthe Hawthorn one and it raises the question: Is Donegal a Waterloo for west of the Bann developers?

Hawthorn had a modest amount of commercial and residential property in Maghera but had about 9m in euro borrowings which obviously relates to its Donegal sites.

Lough Shore Developments which went under last year had a modest amount of property in Fermanagh but foundered on the rocks of a mad plan for a six star hotel in Donegal.

Then there was McDaid Developments (Ireland) of Derry which was up to its tits in Donegal and went under with epic 80% writedowns due to cost BoI £40m.

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BBC have mopped up a few recent insolvency reports.

http://www.bbc.co.uk/news/uk-northern-ireland-12131587

I've had a look atthe Hawthorn one and it raises the question: Is Donegal a Waterloo for west of the Bann developers?

Hawthorn had a modest amount of commercial and residential property in Maghera but had about 9m in euro borrowings which obviously relates to its Donegal sites.

Lough Shore Developments which went under last year had a modest amount of property in Fermanagh but foundered on the rocks of a mad plan for a six star hotel in Donegal.

Then there was McDaid Developments (Ireland) of Derry which was up to its tits in Donegal and went under with epic 80% writedowns due to cost BoI £40m.

Have to agree I never understood the attraction to Letterkenny. Vast overzoned.

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The latest Gazette included a notice stating that Ulster have appointed receivers to a firm called Thompson Lennox, which is based in Magheralin (near Lurgan) and owned by a guy called Sam Thompson.

http://www.thompsondevelopments.com/index.htm

The firm's last set of accounts, up to April 2009 were prepared on a going concern basis but with two material uncertainty notes. In essence those notes said the firm was only surviving on the goodwill of the bank and that the value of it's assets were shot to pieces.

The accounts showed a £1.8m annual loss and total retained losses of around £4.5m. It was carrying total bank debt of more than £24m. Interest roll ups have probably seen that debt figure tick up since then.

Sam Thompson controls a number of other property companies - the main ones being Thompson Developments and TD Homes. Both these firms had assets placed into receivership in the summer of last year, I believe on the instructions of Anglo.

Thompsons were fairly prolific in the Mid Ulster, Tyrone and Fermanagh areas. One of their specialities was builiding large one-off country houses which cost more than £1m at bubble prices.

Their website suggests they still have significant undeveloped land. Which has probably collapsed in value.

Edited by PJ1977
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The latest Gazette included a notice stating that Ulster have appointed receivers to a firm called Thompson Lennox, which is based in Magheralin (near Lurgan) and owned by a guy called Sam Thompson.

http://www.thompsondevelopments.com/index.htm

The firm's last set of accounts, up to April 2009 were prepared on a going concern basis but with two material uncertainty notes. In essence those notes said the firm was only surviving on the goodwill of the bank and that the value of it's assets were shot to pieces.

The accounts showed a £1.8m annual loss and total retained losses of around £4.5m. It was carrying total bank debt of more than £24m. Interest roll ups have probably seen that debt figure tick up since then.

Sam Thompson controls a number of other property companies - the main ones being Thompson Developments and TD Homes. Both these firms had assets placed into receivership in the summer of last year, I believe on the instructions of Anglo.

Thompsons were fairly prolific in the Mid Ulster, Tyrone and Fermanagh areas. One of their specialities was builiding large one-off country houses which cost more than £1m at bubble prices.

Their website suggests they still have significant undeveloped land. Which has probably collapsed in value.

Word is Sam didn't take the crash to well (allegedly) :ph34r:

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Just been having a look at the recently filed accounts of the reasonably big Derry outfit McCormick Properties.

The accounts are for the year ending December 2008 but were only signed off at the end of December 2010. They contain some fairly predictable stuff. The auditor notes a material uncertainity about the firm's ability to continue as a going concern. That's because the balance sheet is more than £7m in the red and also because the firm has been rolling up interest for some time, meaning it only survives by the goodwill of its bank. The total bank debt owing to Ulster is around £67m with another £250k owing to First Trust.

The banking facilities were due to expire in 2009 but have evidently been renewed. The directors have produced cashflow statements which has them lasting until at least the end of the year, providing Ulster allow the roll ups to continue.

The directors' main source of optimism (and probably the banks too) is what they see as the profitable potential of what they term a 'significant development site'. I'm guessing this is the Princes Quay site in Derry where they have plans for a 100,000 sq ft mixed use project. A public inquiry into those plans is due to be heard in March.

A related company had a planning app for a putative Asda store on the Buncrana Road turned down late last year, though they seem likely to appeal.

Edited by PJ1977
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I just heard that a wife of Tagg@rt developer (Dungiven direction remember the helicopter etc...) has opened a restaurant in Limavady. Apparently, there was a big crowd in and they enjoyed the three courses and wine to boot (a very merry night), at the end they just said "tell M*****l to knock it off what he owes us". Considering the amount of small subbies and suppliers who got caught by the Tagg@rt bankruptcy, the restaurant may be very busy......

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The mop up of Patrick Hegarty's fallen empire continues.

There is an admin report available for Kensington Vale Ltd. It controlled 11 commercial properties (presumably in Scotland) with a fixed charge of £4.4m in favour of Clydesdale Bank.

The firm was not profitable but was meeting interest payments. However once Hegarty was bankrupted the bank demanded repayment. Obviously no joy so admin called in.

The admin doesn't say how much of that £4.4m he expects to recover but seems confident of a quick sale.

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The mop up of Patrick Hegarty's fallen empire continues.

There is an admin report available for Kensington Vale Ltd. It controlled 11 commercial properties (presumably in Scotland) with a fixed charge of £4.4m in favour of Clydesdale Bank.

The firm was not profitable but was meeting interest payments. However once Hegarty was bankrupted the bank demanded repayment. Obviously no joy so admin called in.

The admin doesn't say how much of that £4.4m he expects to recover but seems confident of a quick sale.

PH seems to be some of the few that have paid a personal price because of the downturn. Control of the main group of companies was lost overnight and a lurking personal guarantee meant some nice little personal assets were whipped away.

Leverage is a bad word in that family.

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PH seems to be some of the few that have paid a personal price because of the downturn. Control of the main group of companies was lost overnight and a lurking personal guarantee meant some nice little personal assets were whipped away.

Leverage is a bad word in that family.

I think what got him is that BoI had cocked up their security on some company loans. That meant their only recourse was to his PGs, so even though WG Mitchell owed a fortune to RBS it was BoI that ended up bankrupting him over a realtively paltry sum.

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Story is updated to reflect the fact that while the planners have recommended approval it hasn't been discussed by council yet.

That will be interesting. The Councilers can defer for a office meeting (normally takes 3 months to arrange) after that, if the planners haven't changed their minds they can refer the decision back to the Planning Management Board fro review. It can disappear in their for 6 to 9 months. I'm sure the planners have been over this every-which way and couldn't see them having made a mistake of any kind. This has been high profile for a long time.

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Im surprised to see the 200 parking spaces, on ground and first floor still mentioned as part of the plans.. I thought that developers liked nowadays being able to use the 'environmental friendly city living' line so as not to have to design in allocated car parking spaces anymore, or at least that there is only a minimal amount. Never mind that this 'environmentally friendly city living' saves them money having to dig out and seal basement car parks, or 'empty' built levels in the block from which little profit is made.....

This is not a decision for the applicant but for DRD Roads Service. They have to make the decision based on their view on the % of people who will survive without a car. Is walking to the shops easier than driving etc, etc. Also it is easier to sell a house if it has a parking space. Underground parking costs about £20k per space.

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