Prospective bidders for Liverpool's New Chinatown site have been asked to sign non-disclosure agreements.
The Great George Street Project Limited (GGSPL) entered into administration following a High Court hearing in March. The application, brought by Maghull businessman and creditor Francis Molloy, was the latest twist in a long running saga that was first launched seven years ago.
The first property scheme, launched by businessman Peter McInnes and the New Chinatown company, collapsed after a complex legal hearing at Preston Crown court in 2016. New company Great George Street Developments launched a second scheme in 2017.
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Now a report by administrators Cowgills has revealed that prospective buyers of the site have been asked to sign non-disclosure agreements (NDAs). An NDA, also known as a confidentiality agreement, is a legal contract which sets out how you share information or ideas in confidence.
The report states: "Non-disclosure agreements were issued to parties coming forward with expressions of interest -which when signed and returned granted them access to a data room containing all information required in order for them to consider making a bid."
The report continues: "In total NDAs were issued to 76 interested parties , all of which were granted access to the data room and received further information."
The report reveals that the sale of the land is expected to generate a return for secured creditors who are owed money in the scheme.
A report filed by Cowgills earlier this year revealed that investors in the original New Chinatown scheme were owed £5.5m, that Cambridge and Counties bank were owed £4.3m and that Francis Molloy was owed £900,000.
Pak Hung Chan, a member of the city's Chinese community, said:"I think I have given up all hope on the development of the site as it has been such a long running saga of broken promises. It has just been left as a wasteland for fly-tippers."
A spokesperson for the New Chinatown Buyers company which represents investors in the scheme said: "We hope that the site is sold soon to a buyer who is properly vetted so no other buyer is left in the same situation we have been in for the last five years. The buyers' company has been waiting since March 2019 for refunds and it is only the administration of the developer that will deliver them. We now hope a major partner will deliver a scheme that restores pride to the area."
The £200m project by the Chinatown Development Company (CDC) envisaged new shops, homes and offices off Great George Street and was expected to revive the city's historic Chinatown community. However, the scheme began to stall the following year after the ECHO reported on a complicated hearing at Preston Crown Court.
Parent company North Point Global then entered into a legal dispute with Liverpool City Council and work at the site ground to a halt. Investors, who claimed to have put in around £5.5m, formed a buyers company and demanded their money back.
New company GGSD announced in March 2017 that it had bought CDC and hoped to start work on phase one of the scheme during the summer of 2019. Richard Kemp, leader of the city's Liberal Democrats, expressed concern around loan notes, a type of financial bond, sold by the company through agents to investors.
At the time a public relations officer then representing the company assured the ECHO that concern around the loan notes was misplaced. The same officer said that a large financial organisation had agreed to fund the £200m scheme.
Mr Kemp, speaking to the ECHO earlier this week, said: "After seven years in which this prominent site has lain derelict there is both good and bad news contained in this report.
"On the plus side, it would appear that this development may well be sold to a developer in the not too different distant future. This will mean that the original investors will get at least some of their money back. In the summer it was hoped that they would get all their money back. We can only hope that they get back more than the 6 to 7% that original investors have had returned on other sites. It might also mean that the council will end up finally selling the land it has which is part of the development and get some cash back into the council.
"The bad news revealed in the administrator’s report is that so many potential investors have pulled out of discussions because of the real housing market difficulties being experienced not only in Liverpool but nationwide.
"This bodes badly for future development in the city and especially for the 35 stalled sites that still remain.
"Nine sites have moved back into development but, for obvious reasons, they are the best and most profitable sites. I can repeat once again my call for the speculative development of property of the type that was involved at the start of the process to be regulated to avoid further losses from developments."
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