Investors in one of the North East’s most high-profile development groups have backed a move that aims to secure the company’s long-term future.
The High Street Group - best known for building Hadrian’s Tower in Newcastle - had called a crunch meeting with its financial backers to ask them to agree a change that prevented early redemption of investments.
The group said that the change was necessary to protect its future following a turbulent period that saw a number of institutional investors withdraw backing from major projects during the pandemic, and one of its subsidiaries put into administration by its main lender.
High Street Group’s auditors also resigned following a row over access to financial material, while the company’s 2018 accounts were filed more than a year overdue and the 2019 accounts are still outstanding.
The company called a meeting of private investors in a loan note supporting a range of its developments, asking them to agree to new arrangements that restrict early redemptions. The vote was carried by a majority of more than 87%.
Following the vote, High Street Group founder Gary Forrest said: “This vote of confidence in our proposal is an important building block in the full recovery of our business from the financial fluctuations of the pandemic. Our investor proposal was a pragmatic, viable and responsible course of action to support the company’s successful corralling of resources to continue its investment programme.
“Investors will receive 100% of their investment plus the agreed interest, but without the ability for early redemption. This measure is not unusual, in fact during the pandemic the FCA gave permission for investment firms to pause redemptions in order to maintain the viability of the sector.
“This vote gives the board the authority from its investors to execute its five-year business plan. We would like to thank all our investors for their overwhelming support, and we hope to repay their confidence by successfully delivering against our business objectives.”
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High Street Group is leading a major development scheme to create offices, flats and a hotel close to Newcastle’s St James’ Park, as well as developing the former Brett Oils site on the banks of the Tyne.
It also has a number of developments in the Manchester and Birmingham areas, while its leisure arm runs a number of pubs, hotels and restaurants around the North East.