Administrators for a development company have completed a Northumberland residential scheme that the failed firm set out to build.
Lok Developments 05 Limited was put into administration last October, more than five years after it was launched with the sole purpose of constructing commercial and residential buildings. Its main asset was a partially-completed freehold development at Prospect House in Hallgate, Hexham, Northumberland, which it acquired in 2019 for £700,000.
Once complete, it was estimated the project would have a gross development value of around £3.53m. However, Nick Myers and Alex Cadwallader of Leonard Curtis were appointed joint administrators on October 29 2024, after the secured creditor HT Investment SARL – which had provided a loan facility of around £2.7m to the company, took the decision to place the company into administration, to protect its interests and continue with the build-out of the development.
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Documents filed by the administrators showed that the build-out of the development endured significant costs and time overruns, mainly as a result of supply chain issues in the aftermath of the pandemic, the insolvency of the main contractor and the price spike in materials and goods.
The administrators were appointed by the secured creditor to complete the build and delivering essential new housing for the local community, and they received £340,000 from the lender to fund the rest of the work. Now the residential development has now been completed, ready to go up for sale.
The site consists of 16 residential units including one three-bedroom townhouse, 12 two-bedroom units and three one-bedroom units. The one and two-bedroom properties are a mix of cottages and apartments.
The Leonard Curtis administrators instructed the Newcastle-based architects Xsite Architecture and residential specialist contractors, Aston Walker Developments, to help with the development.
They have also appointed Brunton Residential, an independent residential sales and lettings agent in Hexham, to assist and advise them in rthe marketing and sale of the residential units. A structural warranty provider, ICW (Insurance & Construction Warranties), was also put in place to guarantee the works and provide a 10-year insurance warranty.
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Incrementum, a development management consultancy, has also been assisting in delivering the completed scheme.
Nick Myers said: “We were committed to adding value to the asset by continuing with the works – using local North East based property companies as far as possible - and delivering the finished build to a high standard, enhancing the local area as soon as we could.
“Without our collective intervention the unfinished development would have remained mothballed for some time and while it was a challenge getting the site back up and running, we are delighted with the results.”