James Bennett and David Standish from KPMG have been appointed joint liquidators for HAB Land Limited, HAB Land Finance plc and BAH Restructuring.
HAB Land Limited was set up in 2014 with the aim of snapping up land for building projects at sites in Oxford and Winchester, while HAB Land Finance was incorporated as a wholly owned subsidiary in 2016, tasked with raising funds for the property business of HAB Land Limited through the sale of minibonds.
McCloud resigned as director of HAB Land Limited last year. BAH Restructuring took control of the firm in March this year.
Higher design and project costs
The directors of HAB Land wrote to the bondholders of HAB Land Finance earlier in August to explain they would not be in a position to repay the money owed, and put forward alternative proposals.
These were rejected, with a vote then passed yesterday by the company’s creditors to place it into voluntary liquidation.
Bennett said that the companies had experienced “significant liquidity issues” as a result of higher than anticipated design and project management costs, combined with delays to the delivery of the sites.
“After being unable to raise further finance or renegotiate existing liabilities, the directors took the difficult decision to instigate liquidation proceedings,” he said.
“This has resulted in a considerable loss to mini bond holders who largely financed the project. An important element of the liquidators’ role, as usual, will be to review the events leading up to the failure of the companies.”
Two surviving firms
HAB at Lovedon Fields Limited and HAB at the Acre Limited ‒ two subsidiary companies which are controlling the building projects in Oxford and Winchester ‒ are not part of the proposed liquidation.
KPMG said the directors of these firms are exploring options to enable the developments to be completed.
In addition, HAB Housing Limited ‒ another firm founded by McCloud – is also unaffected by the liquidation.