Signing fallout continues as mountain of debt is revealed

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The four Signature Living companies put into administration this summer owed a total of £56million, documents filed with Companies House show.

The Signature Living group expanded rapidly in the late 2010s with an ambitious growth strategy based on opening glitzy hotels and wedding venues, mostly in redeveloped heritage buildings in downtown locations.

Some 60 businesses were operating under the Signature umbrella at the time Covid hit. The subsequent pandemic shutdowns had a catastrophic effect on the group’s revenue streams.

Flagship companies began going bankrupt in April 2020, although founder Lawrence Kenwright continued to try to keep various projects alive.

In August, it was revealed that four more companies had gone into administration. A director’s progress report has been filed with Companies House for each.

Eden signing – £15.5m due

The business, incorporated in January 2016, operates under the trading name Dixie Dean Hotel at 57-59 Victoria Street Liverpool.

Joint directors of Kroll Advisory were appointed to Signature Eden on August 5, following the expiration of a loan facility from development finance provider Lyell Trading in June: $4. £7 million.

Before the directors were appointed, the hotel was operated by UK Accommodation Ops under a management agreement, with the UKAO then engaging Avensis Hospitality to run day-to-day things. Kroll has now removed UKAO and is running the hotel with help from Avensis.

Kroll said he was looking to find a buyer to take the hotel back into operation. Although there has been a delay in obtaining a formal valuation notice, it is expected that a local agent will be appointed to help market the asset. Kroll also asked the UKAO for rent of almost £300,000 covering the ten months before Kroll’s appointment.

The waters are muddied by intercompany loans: as Kroll points out, according to company records, nearly £4.3m is owed by other group entities, with corresponding credit balances of £5.3m. of pounds sterling.

After Lyell Trading, the other main secured creditor is SW Construction (no. 2), which owes £4.4m. While some return is likely for these parties, such prospects are unlikely for unsecured creditors, who owe a total of £6.5million.

Rainhill Hall – £10.5million owed

Again, Lyell Trading brought in Kroll on August 5 following the expiration of a loan facility. The operating company behind the Rainhill Hall hotel and venue was incorporated in 2017 and at the time of Kroll’s appointment owed Lyell £4.7million.

SW Construction (No 2) is also a secured creditor and owes £3.7m. Unsecured creditors owe £2.1million.

As with the Dixie Dean Hotel, Kroll and his agents devise a suitable marketing strategy to get rid of the business. Again, Kroll is currently working with Avensis Hospitality to manage the venue. Although UKAO, which ran the site from 2021, no longer has that role, 49 UKAO staff have been retained.

Shankly Hotel Preston – £22million owed

As indicated by Location North West this week, Kroll is considering his options in the old post office building: sell the unfinished development or take out a loan to complete the 65-room project before negotiating.

Lyell was once again the lender for the development project and owes £12m. SW Construction (No 2) owes £4m. Unsecured creditors owe a total of £6.8million and are likely to miss out, although Kroll predicts some return for secured creditors.

Signature had purchased full ownership of the listed Market Street site from Preston City Council in February 2017, announcing a £15million project including a wedding suite and 7,000sqft roof terrace.

Signature Living Lifestyles – total due £8.2m

The party calling time on SLL was Henslow Trading, the holder of a qualifying floating charge over the business incorporated in 2015. Henslow is based at the same Gloucester address as Lyell Trading.

SLL hold the lease of the Shankly Hotel gym in Liverpool, with full ownership held by associated company SLH, which entered administration in April 2020. The gym was operated by Liverpool City Council under the name by Lifestyles Millennium.

The gymnasium closed for the Covid closures and has not reopened. In a September 2021 statement, the council cited Signature’s issues as a concern, along with Liverpool’s John Moores University, which supplied 80% of gymnasium users, opening its own facility.

Kroll said the gym lease will continue to be marketed for sale as part of the hotel to maximize returns.

Henslow Trading owes £7.4 million. Unsecured creditors owe £868,000.

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