Three Falconer Chester Hall projects worth a combined £420 million have been placed into administration after their client was arrested in December
The Aura and Infinity schemes in Liverpool and The Residence in Salford have all been partially constructed but now face an uncertain future after Elliot Lawless, founder of developer Elliot Group, admitted he was unable to plug a funding shortfall in the projects.
Institutional lenders were due to provide a bridge between up-front construction costs and money being paid in instalments by investors in off-plan flats. However, lenders walked away after Lawless was arrested in December on on suspicion of conspiracy to defraud, bribery and corruption.
Lawless had asked investors to stump up thousands of pounds earlier than scheduled but has now called in administrator David Rubin & Partners, admitting: ‘Existing investors were cautious about backing the projects to their conclusion’.
Falconer Chester Hall director Adam Hall told the AJ last month that he was ‘very confident’ the schemes would be ‘up and running very soon’ and said his practice had not considered the financial implication of the three schemes stopping. The practice declined to comment on the latest revelations.
Lawless has not been charged but yesterday (16 March) magistrates gave Merseyside Police permission to hold on to £337,000 and €10,000 in cash seized from his flat for another 90 days on the basis it may be recoverable or linked to unlawful conduct.
Lawless, who insists he is innocent and that the seized cash is fully receipted, announced this morning (17 March) that he has secured a judicial review into his arrest and the search warrant of his property. An expedited hearing is due to be heard before a High Court in London.
‘I am challenging the police execution of search warrants and the whole basis of their case which, as I have said from the outset, is completely without foundation,’ he said.
The 32-year-old developer also said he would ‘continue to work proactively with investors to explore how we can help them crystallise their investments and get the projects [in administration] completed’.
Liverpool Council’s director for regeneration, Nick Kavanagh, was arrested on suspicion of conspiracy to defraud and misconduct in public office at the same time as Lawless. At court yesterday, police also received permission to hold on to £3,750 in cash seized from Kavanagh.
Aura is a £100 million hotel and student accommodation scheme in Liverpool’s Islington area. Phase one, which included the student digs but not the hotel, was substantially complete when contractor Vermont downed tools in January. It had been due to open in September 2020.
Infinity is a £250 million development formed of three residential towers overlooking Liverpool’s waterfront and business district. The towers, as designed by Falconer Chester Hall, stand at 39, 33 and 27 storeys. Phase one, the largest tower, was due to complete in 2021 and would have contained 424 flats.
The Residence by Falconer Chester Hall
The Residence is a £70 million scheme in Salford, near Manchester Victoria station, with two residential towers standing at 15 and 34 storeys.