Ill-fated car retailer spent £500,000 on premises just 12 weeks before pandemic hit

The decision to spend £500,000 on buying its own property just 12 weeks before the Covid pandemic hit the UK was instrumental in bringing down an Alvaston car retailer, documents seen by TheBusinessDesk.com have outlined.

Joanne Hammond and Kris Wigfield of Begbies Traynor were appointed as joint administrators to new and used vehicle retailer Holt Cars on 2nd February.

Holt Cars was set up in 2012 and had enjoyed years of success up until 2019, which allowed the owners to take a mortgage with Atom Bank to buy its leased premises on London Road in Alvaston for £500,000.

However, just three months later, the company was forced to close because of the first national lockdown, hitting revenues.

This, together with the withdrawal of UK Mitsubishi sales which was announced in July 2020, resulted in a “significantly lower” number of new cars available for sale than forecast. The business employed 12 people and all staff have been made redundant.

Adminstrators from Begbies Traynor say that the firm owed unsecured creditors were owed £280,658.68 when the firm went under. Begbies said there will be sufficient funds available to pay them a dividend on cash owed to them.