Falconer Chester Hall has brushed off fears that three of its Liverpool schemes – Aura, Infinity and The Residence – are facing a cash crisis after they were put on hold following their developer’s arrest
Aura is a £100 million hotel and student accommodation scheme in the city’s Islington area, while Infinity is a £250 million development formed of three residential towers overlooking the city’s waterfront and business district.
The Residence is a £70 million scheme in Salford, near Manchester Victoria station, with two residential towers standing at 15 and 34 storeys.
The schemes are all being developed by Elliot Group, which in December saw its founder and director, Elliot Lawless, arrested on suspicion of conspiracy to defraud, bribery and corruption.
Police have since seized £200,000 from a flat belonging to Lawless but are yet to bring any charges. Lawless denies any wrongdoing.
Following the arrest, Maslow Capital, which had previously agreed to lend money to Elliot Group for the construction of Aura and Infinity, pulled out of funding arrangements – causing contractor Vermont to down tools on the sites.
Construction has not also stopped at The Residence as more institutional investors shy away from funding commitments while the police investigation is ongoing.
Lawless has written to buy-to-let investors who have purchased off-plan flats at all three schemes, telling them he needs payments amounting to tens of thousands of pounds up to a year earlier than previously agreed.
If 75 per cent of investors for each scheme do not agree to stump up, the development vehicles behind the projects will enter administration as Lawless is effectively unable to borrow money while he is accused of fraud.
The collective decision of investors in Aura and Infinity are expected to be announced in the next two weeks. If they agree to provide the funds, construction work could resume within the following month.
Falconer Chester Hall director Adam Hall, said he was ‘very confident’ that the schemes would be ‘up and running very soon’.
Hall had originally told the AJ he thought the pause on construction of Aura and Infinity would last about a week, but now said: ‘Honestly, we haven’t noticed [the pause in construction work].
‘We won two jobs before Christmas’s which have more than eaten up any capacity we had.’
Hall added that even if investors did not agree to inject more cash into the schemes, he believed Lawless would find a way to hold on to them.
The AJ100 practice is currently working on 10 projects with Elliot Group that are between the pre-application and building on-site stages.
Hall described Lawless as an ‘ambassador for Liverpool’, adding: ‘He was really on a roll and it seems as though [there are] political, internal issues – potentially the way in which the council want to run their organisations – [which] he has been dragged into.’
Lawless was arrested at the same time as the council’s director for regeneration, Nick Kavanagh, was arrested on suspicion to defraud and corruption in public office. Kavanagh has not been charged.
Hall added that his practice had not considered what impact Lawless being charged would have on their business.
‘He is a very small portion of all our work,’ he said. ‘He is one client among – I don’t know – 50 clients of that nature.’