Investors who put money into a luxury apartment conversion project face potential financial losses as a legal battle looms with a pension fund.
Investors who eagerly anticipated the conversion of the iconic Caxton Hall building into 23 upscale apartments in Salford’s Flat Iron Conservation Area are now confronted with a grim reality. A dozen individuals, each having invested 50 percent of the £120,000 asking price per apartment, find themselves in a precarious situation as the project has come to a halt. The developer, Wilma Developments Limited, has gone into compulsory liquidation, leaving investors in a precarious position.
The Pension Fund Dilemma
The building’s owner, the Jerrold Manufacturing Company (Textiles) Ltd Pension Fund, based in Cheadle, is at the center of the legal battle. In light of the developer’s collapse, Jerrold has applied to the Land Registry for the removal of a Unilateral Notice (UN1), currently held by the investors. This notice essentially grants the investors significant control over the property and its future development. If the Land Registry approves the removal of this notice, investors will effectively relinquish any control they have over the property and, consequently, the substantial sums of money invested.
A Tribunal Decides
The fate of these investors will be decided in a Land Registry tribunal, with the date yet to be determined. A spokesman from the Land Registry confirmed the receipt of applications to cancel the Unilateral Notices and mentioned the objections received from solicitors representing some of the beneficiaries (the investors). He added that a Property Chamber first-tier tribunal would be convened to resolve the matter.
One investor, who wished to remain anonymous and is based in Portugal, expressed his concerns. He paid over £70,000, more than half the asking price, in 2018 to reserve an apartment. A recent visit to the property revealed that only superficial preparation work had been undertaken, raising red flags. He mentioned that the legal fees to represent him at the upcoming tribunal could amount to £20,000, a significant financial burden.
International Investor Base
Attempts to contact other investors have yielded limited responses, as many appear to be based in the Far East, including Hong Kong. This investor, who is not a Salford resident but frequents the area, highlighted the allure of the city and its proximity to Manchester.
Other Parties Involved
The list of objectors to Jerrold’s UN1 application, according to a Land Registry document, includes twelve individuals and one property company, KMM Properties (NW) Ltd, based in Ashton-under-Lyne. Jerrold Manufacturing Company has chosen not to comment on the situation.
A Historic Building’s Fate
Caxton Hall, dating back to 1904, held historical significance as the headquarters of the Manchester Typographical Society, named after the printing press inventor William Caxton. In 2017, a planning application was approved to convert the offices into 23 apartments, setting the stage for this now-troubled project.