Hood Property Cardrona Limited, the Scottish housebuilder behind a 20-home development near Peebles, has plunged into administration with debts of £4.5 million, leaving homes unfinished and creditors facing a significant shortfall.
Administrators had to "forcibly gain entry" to the site, where offers had already been accepted on several properties, and more funding is needed to finish the development.
Administrators appointed at Cardrona site
James Stephen and Kerry Bailey of BDO have been appointed joint administrators and extended the administration period until September.
They said: "Upon appointment, my staff together with our appointed security agent visited the company's development site at Cardrona next to the town of Peebles in the Scottish Borders. Nobody was present at the site and they therefore required to forcibly gain entry to enable an initial assessment of the site to be carried out and new security measures to be put in place."
A sale is "now proceeding and we anticipate it will be completed in the next few weeks", they added.
Creditors face significant shortfall
Stephen and Bailey continued: "This ranks the security granted by the company in favour of Crowd Property ahead of the security granted by the company in favour of Duart Investments and Castle Fox. At the date of appointment, the amount outstanding to Crowd was £4.5m. Based on the current offer being progressed, Crowd will receive proceeds of £1.1m, resulting in a significant shortfall."
The amounts due to Duart Investments and Castle Fox are unknown, but it is not anticipated that they will receive any return on their lending in the administration.
HMRC has submitted a claim for £4,684, and a further £300,000 is owed to creditors, though it's not yet confirmed whether this will be paid.
The administrators warned: "It is anticipated that a dividend will not be paid to unsecured creditors."
