Bankrupt developer’s Olympic site sold

ADMINISTRATORS to bankrupt developer John Fleming’s British property empire have secured planning permission for a 225-bedroom three-star hotel, 158 residential units and commercial units on land owned by Fleming Developments UK on Olympic Way near Wembley stadium in north-west London.

It also appears that the administrator, Baker Tilly, has sold the site, according to a document that was filed to Companies House last month.

The papers show that the mortgage from Anglo Irish Bank to Fleming Developments UK for the London site had been satisfied.

That came after Baker Tilly lodged a report last September stating that an offer on the site had been accepted and completion of the sale was “due shortly”.

The statement of affairs for Fleming’s company showed a liability to Anglo Irish Bank of £33 million in relation to the Olympic Way site. If the site had been sold in July last year, the estimated shortfall would have been more than £14.3m as the land was believed to be worth less than £19m, compared to a book value of £37.9m.

Planning took more than two years to be granted, despite the fact that in June 2009, Fleming Developments UK “had specified an urgent need for determination” of whether the development should proceed, planning documents for Brent council show.

Documents also show that the company had a debt of £1.72m to AIB over houses at Allerton Bywater in Leeds and a floating charge over the remainder of the company’s assets.

Fleming Developments UK was also liable for €248m owed by other Fleming Group companies under cross guarantees to AIB.

The Allerton Bywater houses are currently being prepared for sale but there is expected to be a shortfall of more than £1m on the £1.7m mortgage related to that site.

“We anticipate there will be significant shortfalls to both Anglo and Allied once the secured assets have been realised,” the report states.

The administrators will continue their work on Fleming Developments UK until September 25.

Creditors of Fleming Developments UK are owed £25.9m by the group.

Fleming was declared bankrupt last November in Britain, meaning he can emerge from the process in as little as nine months, compared to a typical term of 12 years in Ireland.

The Cork developer’s construction and investment companies owe about €1 billion to various banks and three of the companies went into liquidation in March of last year.

Fleming started out building houses in the 1970s around Bandon before moving onto the national stage in the 1990s and 2000s.

He is the first major Irish developer to opt for bankruptcy in Britain. At least one other developer has moved there since, with the aim of using the same process, and a number of developers in NAMA are considering doing so.

NAMA has said that even if the debtors do move to Britain, they will bankrupt them in Ireland anyway.

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