05-11-2018, 03:05 PM
I have spoken with someone far more learned than me who has offered the following:-
"Most Collateral property loans are development loans so have either refinanced or run out of funding. In the case of work being stopped BDO have two choices, wait for the developer to come up with a proposal or appoint receivers/administrators, if they do they would have to fund from somewhere the costs of securing the sites and, probably, severely damage the residual value. A further problem is these are not assets that the comany in Administration stands to benefit from so although they might have some Collateral assets (e.g. cash from the office account) they can't use them to the benefit one group of "trust" creditors over another. They also cannot borrow money, even if someone would lend it to them, for the purpose.
I have to agree this is an unholy mess and far from "protecting" investors interests the FCA action has almost certainly not been to the investors advantage but it is difficult to see what else could have been done."
"Most Collateral property loans are development loans so have either refinanced or run out of funding. In the case of work being stopped BDO have two choices, wait for the developer to come up with a proposal or appoint receivers/administrators, if they do they would have to fund from somewhere the costs of securing the sites and, probably, severely damage the residual value. A further problem is these are not assets that the comany in Administration stands to benefit from so although they might have some Collateral assets (e.g. cash from the office account) they can't use them to the benefit one group of "trust" creditors over another. They also cannot borrow money, even if someone would lend it to them, for the purpose.
I have to agree this is an unholy mess and far from "protecting" investors interests the FCA action has almost certainly not been to the investors advantage but it is difficult to see what else could have been done."