Major student accommodation scheme up for sale after developer enters administration

The company behind a 326-bed student accommodation scheme in Derby has been placed into administration.

Developer Prosperity Cathedral View Development was placed into administration on 4 May, with Opus Restructuring & Insolvency taking over the day-to-day running of the company in conjunction with the management company.

Trevor Binyon

The firm had been experiencing financial pressure following a delay in development completion in 2019 which had resulted in a lower than expected student take-up rate. It had been in negotiations for a sale of the development which fell through in late 2019.

Following this, cashflow restraints resulted in a breach of the funding facility with attempts to refinance the project proving unsuccessful. This, coupled with the COVID-19 outbreak, saw the company advising the majority funder that were unable to meet the finance requirements and the Board were seeking to pass a resolution to place the company into administration.

Administrators Colin Wilson and Trevor Binyon at Opus Restructuring & Insolvency say they are working closely with the chargeholders, the directors and the management company to ensure the facilities remain fully functional whilst considering the wellbeing of the students currently in residence.

Colin Wilson

At the appropriate time, the administrators say they will be looking to sell the development and will continue to market the accommodation for the 20/21 academic year. The chargeholders continues to support the ongoing running costs of the property whilst a purchaser is sought.

Colin Wilson said: “We appreciate this is a difficult time for many sectors. Whilst there is uncertainty surrounding the return of students to university, we are keen to ensure continuity of service for the students and will work to ensure a smooth transfer of the development without causing any inconvenience or uncertainty for them.”