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Friday, 24 September 2010

Centrepoint landlords in administration move

Centrepoint owners, Targetfollow, have slammed Lloyds Banking Group's threat to appoint administrators over a £700m debt. It is understood that the company is unable to meet interest payments. Part of the problem is that there is a disagreement over the value of the company's portfolio. Lloyds reckon it is worth only £450m whereas the company values their portfolio at, funnily enough, £680m. It should be remembered that following the last recession valuations for banks by chartered surveyors are regulated by the Royal Institute of Chartered Surveyors (RICS). Of course, some have argued that they have been overly pessimistic about values following the credit crunch.

Lloyds Banking Group are under pressure to repay loans from the taxpayer. However, I expect to see much more of this sort of action if patience starts to run out with commercial property owners. Especially, if values start to soften a little.

Targetfollow have said they are taking legal advice on the matter.

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