Were you an investor in the now-collapsed High Street Group? Are you interested to know the circumstances surrounding their promises-turned-perils? Or are you just looking into loan notes and came across the story of this property developer?
Student housing, hotels, and residential complexes are among the projects that the firm has completed in the UK.
Unfortunately, numerous private investors reportedly lost savings due to High Street Group’s financial ruin.
Understand the risks associated with High Street Group loan notes investment and explore safer savings and investment vehicles.
If you are looking to invest as an expat or high-net-worth individual, which is what I specialize in, you can email me (advice@adamfayed.com) or WhatsApp (+44-7393-450-837).
You should review your entire portfolio since you may have greater hidden risk now that they have defaulted.
First, we’ll look into the background of the investment provider before we dig into what has become of its loan notes.
Who is High Street Group?
In 2006, Gary Forrest established The High Street Group, a firm that specializes in Real Estate development. It has a reputation for being involved in a wide range of commercial and residential real estate ventures.
After changing its name to Hadrian Real Estate, The High Street Group reorganized its more than seventy-eight enterprises. The business was able to secure funding through the sale of investment notes.
High Street Group Investment
The High Street Group issued Loan Notes to finance real estate developments in UK cities. Businesses often issue loan notes to raise capital for developments.
Those who could put their money in High Street Group included companies, restricted investors, professional investors, sophisticated investors, as well as those with high net worth. Advertisements for the loan notes claimed that, under specific circumstances, investors might earn returns of up to 12% annually, with additional bonuses on the table.
What happened to the High Street Group loan note?
The company’s inability to pay loan note interest in 2019 and subsequent refusal to allow investors to withdraw their funds about two years later, despite annual redemption promises, caused investors to get worried about the investment option.
According to Insolvency & Law, about 118 million British pounds was invested heavily in High Street Group before the company went bankrupt.
Business Live UK reported that High Street Group’s insolvency is a result of difficulties encountered when working on prominent projects such as Hadrian’s Tower in Newcastle, as well as in Birmingham and the North West.
Bankruptcy procedures and probes into the transfer of monies among the High Street Group’s businesses have both been publicized.
Administrators have been looking into various withdrawals and transactions between companies, which has raised questions regarding High Street Group’s financial situation, according to the report. Investigations and insolvency actions are still continuing amid the company’s predicament.
High Street Group reportedly has roughly 212 million pounds worth of liabilities.
Other things to note about High Street Group collapse
- Financial Negligence: Concerns over Hadrian Real Estate PLC’s stability were voiced by administrators, casting doubt on the company’s capacity to meet its financial obligations to investors, Business Live said.
- Non-disclosure: The company’s founder, Gary Forrest, failed to provide administrators with a Statement of Affairs sought in 2022, despite their request. The company’s financial situation has been the subject of investigations due to this lack of openness.
- Substantial Capital Transfers: Inter-company withdrawals and receipts totaling 168 million pounds have been identified by the administrators as requiring additional investigation. Concerns about the company’s financial management have been aroused by these transactions.
- Notable Advancements: The firm was working on a number of significant projects, such as housing developments in Birmingham, but these efforts might have added to the company’s financial woes.
One of the joint administrators reportedly told Business Live that the company was given multiple potential development sites to choose from. Institutional investors were supposedly going to fund these initiatives, according to Hadrian. However, fund recovery from the firm seems to be highly unlikely, as per the report.
Final Thoughts
The events involving the High Street Group highlight the complications encountered by UK property developers and the high street as a whole. A lack of reasonably priced homes has pushed up demand and prices in the residential real estate market. Shops dealing with high prices are in a similar situation.
It is best to consult with a financial advisor to know the necessary steps to take now that the High Street Group loan note situation has come to this. Investors should be aware that the insolvency procedure could drag on for a long time with little to no payback for them.
Investing in loan notes is risky and necessitates expert financial advice should investors decide to take on such uncertainty. Like what happened with High Street Group, past performance doesn’t give an assurance that a firm will continue to deliver in the future. It pays off to be more cautious when putting money into any investment options.
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