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Leeds developer in administration

One of Leeds' biggest developers has today gone into administration - blaming the banks for "strangling the company".

In a statement released on Wednesday morning, a K W Linfoot spokesman said: "Due to the continued difficulties in the banking and financial sectors the directors of KW Linfoot Plc have reluctantly made the decision to place the company into administration as of 24 February 2009."

Linfoot was the firm behind the Leeds city centre Lumiere scheme which was put on ice last year and has been responsible for a large part of the regeneration of Leeds City Centre.

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Linfoot is still involved in developments at Manor Mills in Leeds, where 275 apartments have been pre-sold, and Manyoo – apartments close to the BBC's planned "media city" in Salford.

Today the company said the Lumiere, Manyoo and Manor Mills projects were unaffected by the administration process and would be taken over by their joint venture partners.

The Linfoot team will continue to manage the construction, sale and legal completion of the schemes.

Today's statement continued: "Contrary to the negative press coverage given to the residential market, particularly in Leeds, KW Linfoot Plc has continued to experience significant demand for both its product and city centre living.

Leeds' developer's empire in tatters - CLICK HERE FOR THE BACKGROUND ON TODAY'S ANNOUNCEMENT.

KW LINFOOT IN ADMINISTRATION - READ THE COMPANY'S STATEMENT IN FULL.

"City centre properties remain popular and this is reflected in the continuing demand for rental properties, rising rental values and 90 per cent plus occupancy rates.

"Over the past 12 months, however, like every other property development business, KW Linfoot Plc has found its dealings with the banks increasingly difficult due to a complete withdrawal of development funding to enable it to progress new schemes.

"This is compounded by the dramatic reduction in mortgage products making it increasingly difficult for purchasers to complete on apartments purchased off plan.

"In taking this action the banks have effectively strangled the business and denied it any opportunity to trade through these difficult times."

Gary Blackburn and Paul Whitwam of BWC Solutions in Leeds have been appointed Administrators with the assistance of solicitor's Irwin Mitchell Leeds office.

The statement concluded: "The board of KW Linfoot Plc recognised the problems in the market and UK banking sector some 12 months ago and since then have been actively seeking alternative funding routes.

"It has identified a significant appetite from overseas investors who remain very enthusiastic about investing in the UK and have been willing to invest up to 50m into KW Linfoot Plc's schemes.

"Unfortunately the lack of bank funding to match their investment has resulted in potential deals falling through."

Frasers Property, partners with Linfoot in the Lumiere project, said: "The administration of KW Linfoot plc does not affect Lumiere in Leeds.

"In addition, the administration of KW Linfoot plc does not have an impact on the commercial viability of Lumiere.

"In light of developments relating to KW Linfoot plc, Frasers Property will undertake a review of all their options regarding Lumiere. At present, no final decisions have been made.

"Due to the difficulties in the global financial marketplace, the joint venture partners decided last year that it was in the best commercial interests for all parties to put on hold the next phase of construction works on the site. This ensures that the project can be progressed when favourable market conditions return.

"The circumstances of KW Linfoot plc have no legal impact on the status of apartment purchasers in this project who continue to have the usual benefit of credit insurance with Zurich."

Leeds' developer's empire in tatters - CLICK HERE FOR THE BACKGROUND ON TODAY'S ANNOUNCEMENT.

KW LINFOOT IN ADMINISTRATION - READ THE COMPANY'S STATEMENT IN FULL.

 
 
 

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