Case Studies Property Receivership

Large Residential Portfolio Based in the Midlands

The owner of a large portfolio of residential investment properties based across the Midlands had failed to make repayments.

CG&Co’s Appointment

On day one, we visited all the properties and served all tenants with the notice of appointment to ensure we subsequently secured the rental income.

We also made contact with the first charge holders to establish payment terms to arrange continued payment of their mortgages.

In addition, we assessed any urgent repairs and ensured all properties were compliant with all requisite legislation.

The Outcome

As soon as the tenancy position had been confirmed and rent collections had been commenced, an appraisal of the portfolio was made and a national agent was instructed to market the portfolio as a whole.

In addition, we also requested the agent to provide the option to parcel up specific sections – to ensure that the less desirable properties were not the only ones that didn’t sell.

Interest levels were exceptionally high – and we successfully agreed sales with the portfolio being split into two parts.

Once the second sale was completed, it was possible to repay all lenders in full.

Case Studies Property Receivership

The Owner-Occupied House Sold Following their Eviction

The owner of the property was seeking to refinance but hadn’t been able to do so within the requisite timescale.

CG&Co’s Appointment

We immediately commenced possession proceedings and agreed a consent order allowing the borrower three months to complete or, alternatively, vacant possession was to be delivered.

Once that period had elapsed and vacant possession had not been provided, we scheduled enforcement which prompted the borrower to hand over the keys to avoid the necessity of bailiffs attending.

The Outcome

As soon as we were in possession, we obtained appraisals, agreed a private treaty sale and instructed the selling agents.

The sale was subsequently concluded three months later with the lender recovering their entire loan.

Case Studies Property Receivership

The Converted Buy-to-Let Property in Need of Repair

Secured against a buy-to-let mortgage, this property had been converted into two self-contained flats which had subsequently fallen into disrepair.

CG&Co’s Appointment

We immediately obtained proof of the existing tenancy agreements that were in place for each flat and ensured that the rent was collected.

We also identified that the owner had failed to maintain each property and ring-fenced those repairs that were required immediately.

As a result of this due diligence, we also realised that gas safety certificates were urgently needed for both property.

The Outcome

The cost for this repair and maintenance programme – which was carried out swiftly using an existing network of contacts – was covered entirely by the rental payments.

After obtaining appraisals from several leading local agents, we agreed to sell the property subject to existing tenancies, as the cost of obtaining vacant possession was not financially viable.

Due to its excellent location, the property was subsequently listed with a local estate agent – and successfully sold for close to its asking price just four months after CG&Co had initially been appointed.

Case Studies News Property Receivership

The Buy-to-Let Apartment with an Existing Tenant

The borrower had been unable to meet interest payments on a loan secured against an apartment, which was a buy-to-let investment, based in a city centre.

The existing tenant had paid 12 months’ rent in advance.

CG&Co’s Appointment

After being appointed by the lender, we immediately obtained private treaty and auction appraisals.

We subsequently agreed the disposal strategy with the second charge holder.

After this, a local agent was instructed to sell subject to the existing tenancy.

The Outcome

The sale was subsequently agreed at full asking price – with apportioned reduction on completion equivalent to lost rent to the purchaser up to the end of the tenancy.

The lender subsequently received full repayment with the surplus returned to the borrower.

Case Studies Property Receivership

Excellence Exemplified: The Mixed Commercial and Residential Property in North London

Based in a popular North London borough, this property consisted on three commercial units on the ground floor with numerous residential flats above.

Two of the commercial units were let on full repairing and insuring (FRI) leases with the flats above 100% occupied on assured shorthold tenancies (ASTs).

CG&Co’s Appointment

Straight away, we secured the rental income and made enquiries with the previously instructed agent to establish interest in the vacant commercial unit.

A joint agent was instructed to appraise the property and shortly after terms were agreed for a lease of the vacant unit, bringing the property to full occupancy.

The Outcome

Once the appraisals were received, a disposal strategy was agreed the joint agents were instructed to sell by private treaty.

Given the location, occupancy level and passing rent, interest levels were high with various offers received, leading to a deadline set for best and final bids.

A sale was agreed in excess of expectations, with completion resulting in a sizeable surplus being returned to the borrower after the lender had been repaid in full.

Business Recovery News

CG&Co Goes for Growth with new In-House Legal Department

CG&Co has established its own in-house legal team to ensure it consistently provides clients with the most comprehensive and responsive service. The firm, specialising in insolvency and property receivership, has appointed, Amy Crighton as its first in-house solicitor.

In-House Team

CG&Co‘s partners took the decision to create the new department to provide clients with specialist legal guidance as swiftly as possible. This new department aims to prevent interest on bridging loans accruing more than is absolutely necessary.

In addition, CG&Co witnessed a 40% increase in demand for its property receivership services over the past year. This resulted in it engaging costly external lawyers with greater frequency.

“I leapt at the opportunity to be a part of such a thriving and fast-growing business as CG&Co when it arose. After meeting with the partners, I realised that this newly created role would be exceptionally rewarding both professionally and personally; given the diversity of the work that takes place here,” explained Crighton, who is now in post.

“Building CG&Co’s in-house legal team from scratch is undoubtedly going to be a challenge – but I know that it will ensure we can provide clients with the right service at the best price.”

Prior to joining CG&Co, Crighton worked in the Insolvency and Corporate Recovery team at law firm DWF, where she was recognised by the independent Legal 500 ranking guide as a “key lawyer”.

Crighton has advised a variety of clients in connection with high profile insolvencies and receiverships. This includes the administrators of a Formula One team.

She brings substantial experience of acting for the receivers of property developers to her new role as CG&Co’s in-house solicitor.

A Partner’s Input

CG&Co partner Daniel Richardson said: “We knew as soon as we met Amy that she would be a perfect fit for this role at CG&Co and have tasked her with creating our own legal team. Her expertise and experience enhance the service we provide clients. We’re now able to provide legal input more quickly and cost-effectively. With the volume of property appointments handled by CG&Co constantly increasing, having an in-house legal team means that we’re able to provide a comprehensive service that’s totally responsive.”

Business Recovery News

COVID-19 Guide for Lenders

The COVID-19 pandemic has resulted in various changes to the way the whole of the United Kingdom and its businesses operate.

While it may feel like everything is on hold, there are steps that certain lenders can take when it comes to enforcement. We have highlighted these in our COVID-19 Guide for Lenders.

Read the full guide here:

Business Recovery News

CG&Co warns against “business complacency” in the wake of new insolvency figures

CG&Co has warned businesses operating in every sector not to take “false comfort” from the latest insolvency figures.

Government data showed there were 3,883 company insolvencies in England and Wales in the first quarter of 2020, representing a decrease of 8.5 per cent from both the previous quarter and the same period in 2019.

CG&Co, which specialises in business recovery and turnaround, asserts that the new figures released by the Office for National Statistics (ONS) cannot reveal any “real insight” about the current state of the economy in the wake of the coronavirus pandemic.

Partner Daniel Richardson explained: “These figures would potentially have been encouraging for many businesses operating in England and Wales if it hadn’t been for the outbreak of coronavirus.

“But we’re now living through truly uncharted times and the UK-wide lockdown which commenced on March 23 only features in the last week of the statistics.

“Consequently, it seems fair to assume that the quarterly and year-on-year decreases in corporate insolvency numbers simply aren’t going to last given the current economic climate.”

Daniel asserts that a possible reason for the improved results in the first quarter of 2020 was because many companies had bolstered their working capital facilities before the EU departure date at the end of January.

He concluded: “The figures for the current quarter that runs until the end of June – and those that follow afterwards – will be far more indicative of coronavirus’ true impact on UK plc.”

According to the latest figures from the ONS – published 30-04-2020 – there were 3,883 company insolvencies in the first quarter of 2020 in total.

Creditors’ Voluntary Liquidations (CVLs) were the most common type of company insolvency, accounting for 70 per cent (2,708) cases, followed by compulsory liquidations (18% – 701).

The remaining 12% was made up of all other types of company insolvency.