Fear over savers’ cash as £60m property scheme goes bust

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Investors who put tens of thousands of pounds into a £60m student accommodation project in Cardiff have been left fearing for their life savings, after the scheme collapsed.

Savers purchased off-plan units for around £80,000 each in a block of more than 700 student flats, which were supposed to be built in Cardiff’s East Bay area, close to the city’s docks, in 2019.

They were promised an income yield of 8pc, but not one brick has been laid on site after the developers failed to raise sufficient funds to complete the project, Telegraph Money understands.

One 62-year-old NHS worker invested money she inherited from her late mother. Another saver, a 55-year-old from London, invested money she was planning to use to help her daughter on to the property ladder. 

They said communication about the stalled project had ceased following the collapse of the company behind the scheme, Experience Invest, in late 2020. 

Experience Invest entered into liquidation in December 2020 with almost £2m owing to creditors, including almost £1m owed to HM Revenue & Customs.

The company was run by Steven Worboys, who marketed a number of failed schemes including a care home project which left investors £1.5m out of pocket and an unsuccessful scheme selling “bargain” houses going through foreclosure in American cities such as Detroit during the financial crisis.

“We don’t know where our money is and whether or not we will ever get it back,” one investor said.

A scathing letter to investors from the developers, East Bay Cardiff Limited, a shell company of Experience Invest, appeared to blame angry investors for the collapse of the project, accusing them of causing bad publicity, relating to a string of other failed schemes the firm had also been involved with. 

This included three hotel projects in Liverpool operated by developers Elliot Group, which collapsed into administration during the pandemic.

Experience Invest said “as the exclusive sales and marketing agent for these projects” the firm had become “the target of frustrated investors who orchestrated a premeditated online assault” to “destroy its reputation”, saying “although sales had started well and approximately 100 sales were achieved within the first six months, it has since proved near impossible to operate under this backdrop”. 

It concluded that the development would likely be repossessed by the bank.

Mr Worboys could not be reached for comment. 

A statement on the Experience Invest website said the company ceased trading in 2020 and said it would not be able to assist customers with their investments.

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