Newcastle city centre housing scheme put up for sale by administrators

A residential scheme at a prime location in Newcastle city centre has been put up for sale after the firm behind the project collapsed into administration.

Cuthbert House – based right next to the Tyne Bridge – once provided office space for a number of businesses but the outdated and underused building lay empty for years before plans to transform into housing finally took shape around six years ago. A developer which has since been dissolved secured permission in 2018 to convert the 1970s block into 311 modern flats, consisting of 295 studios, 11 two-bedroom apartments and five accessible studios, with a study lounge, meeting rooms, a communal kitchen, and a fitness suite.

When work finally began the scheme through a different company, however, it was significantly scaled back to less than half the original number of homes. Work on the building, which was originally constructed as part of the All Saints Office Precinct, is under way – but the firm behind the building, Featherfoot Cuthbert House Ltd, went into administration last month.

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Lee Van Lockwood and Gareth Harris of the Leeds office of RSM UK Restructuring Advisory were appointed on April 16 – and now the joint administrators have instructed property consultancy Sanderson Weatherall to bring the “part-complete residential conversion opportunity” to the market.

Marketing materials for the building show how the property has been partly converted and, upon completion, will provide 146 apartments including 135 one bed homes and 11 two-bed units. Cycle storage and 16 car parking spaces are also proposed. A separate planning consent was obtained in September 2022 for a vertical extension which would create an additional 14 apartment units but those works have not started.

Two other developments – Globe Works in Bolton and Bayer House in Newbury – are also up for sale, following similar administrations for Featherfoot Globe Works Ltd and Featherfoot Bayer House Ltd, and the trio of schemes have a combined 487 apartments. Offers are being invited for the freehold interest of each development by July 12.

Neil Bestwick, partner in Sanderson Weatherall’s restructuring and recovery team said: “We expect there to be considerable interest in these developments which are in the main well advanced in terms of the conversion works undertaken. Once complete, each building offers great investment and owner occupier potential, with all three properties being in excellent locations, close to local amenities and key transport infrastructure.”

Globe Works in Bolton has 134 one, two and three bed units, 26 of which are complete, while Bayer House in Newbury provides 191 studio, one and two bed unit types and multistorey car parking.

Lee Lockwood and Gareth Harris of RSM Restructuring Advisory said Featherfoot Cuthbert House Ltd is a SPV (Special Purpose Vehicle) established to develop the site in Newcastle. The business has planned to create 153 modern residential units at the city centre site. The company has no direct employees and therefore there are no redundancies resulting from this administration.

Mr Lockwood, partner and joint administrator for RSM UK said: “While we are still in the early stages, initial information indicates the company may have become insolvent due to a range of factors including (but not limited to) difficulties sourcing labour in the current tight labour market, increased material costs caused by macro-economic factors, increased interest rates, and issues in completing unit sales, due to reduced appetite from buyers.”

RSM is currently looking into the options available to Featherfoot Cuthbert House Ltd and said it is too early to say what will happen to the building.