Plans for a huge development in York are in doubt after the collapse of another company.
More than 600 homes were due to be built on the former gasworks site of Heworth Green.
But the developer Heworth Green Developments Ltd went into administration in August.
It means the administrators Moorfields of London are trying to find a buyer for the land – which was cleared at huge expense to rid the soil of industrial contaminants.
The plans for 607 built-to-rent flats were passed by one vote City of York Council in March 2020.
A report by the administrator says that Silbury Speciality Finance Limited refinanced Heworth Green Developments’ debt in August 2022.
It says: “The site remediation and construction works endured significant time and cost overruns. This was due in large part to the original ground works contractor entering Administration in February 2023.
“The company (Heworth Green Developments) also failed to comply with its obligations under the facility agreement with Silbury, constituting an event of default.
“Consequently, all of the company’s liabilities under the facility became due and repayable and Silbury served demand on the company on 2 August 2023.”
Silsbury was owed £28,178,385 before applying any interest or charges.
Heworth Green Developments Ltd has one director, John Neal. Paul Ellis resigned as a director in May 2023 and Stephen Ellis in March 2023.
North Star (York) Investment Limited ceased to be “a person with significant control” in March 2023.
Mr Neal and Stephen Ellis were both directors in two firms at the heart of the collapsed Roman Quarter development – the firms are now in liquidation owing £24 million.
And Mr Neal was one of two directors behind Toft Green Developments Ltd, which wanted to redevelop the Fibbers site, and has collapsed owing £3.6 million.
Heworth Green Developments owned freehold land and property with a book value of £30 million, according to the administrators.
A statement from August gives an ‘estimated deficiency’ of £37.3 million. But a full statement of affairs has not yet been published.
The administrators list 33 creditors including:
- Ice Cubed Consulting, Castlegate York – owed £18.6K
- Ice Cubed Property Finance, Clifton Moor York – £175K
- Neal Investments Ltd – £4.45m
- Vincent & Brown, Bishopthorpe – £240K
- SVG Property Investments, Brandsby, York – £518K.