Interest has been expressed from potential purchasers of the unfinished Shankly Hotel in Preston city centre – but problems with its “fire strategy” could be putting them off. That is according to a progress report from administrators dealing with the collapsed company behind the scheme, Signature Living Preston.
The document – filed with Companies House – reveals that there has still been no firm decision about whether to complete the development before selling it or to put it on the market in its current state. That means one of the central dilemmas over the ongoing conversion of Preston’s former main Post Office building remains unresolved.
And it comes exactly six months after the last official update was provided and more than a year since the administration process began in August 2022.
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The latest report, produced by administrators Kroll, points towards “a number of outstanding matters in relation to building control sign off and the fire strategy which continue to hinder progress with the development” – and which could be deterring buyers of the Birley Street building.
As the Local Democracy Reporting Service revealed at the time, Preston City Council last month approved an application submitted by Kroll to revise the description of the hotel that had previously been approved by the authority – with the only difference being the removal of any reference to the number of bedrooms it will have.
Previously, 66 guest rooms were planned, but the council was told that the building had “varied slightly from the planning drawings”. The administrators’ update report – which covers a period that ended shortly before the amended description was given the green light – refers to a planning application having been submitted which “addresses the various issues around building control and fire strategy, which in turn should make the property more attractive to interested parties”.
Those issues were also blamed for a delay in appointing a selling agent. However, the document states that agents are now undertaking “a new, accelerated marketing strategy” which will ensure the administrators are properly informed about “interest, offers and market pricing”.
A range of potential interested parties are being targeted – in addition to those that have already made expressions – including the hospitality and leisure sectors, entrepreneurs, lawyers, corporate financiers, turnaround specialists, business advisors and private equity firms.
Kroll says that construction costs incurred since it was appointed administrator last year have totalled £936,000, which has been funded by a secured creditor. The firm says that if it proves viable to complete the development and for the hotel to begin trading, “a better outcome” is likely to be achieved for all creditors.
However, it also warns that due diligence is still being carried out on the property and that if “regulatory and compliance matters” are identified, they would need to be rectified before any sale. It is now more than five years since the first planned opening date for the venture. However, the project was beset with delays even before Signature Living Preston fell into administration last year.
The period of administration was extended back in June and will now run until August 2024.
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