Business Failures in the Commercial Property market are set to rise says KPMG Corporate Restructuring chiefs.
Richard Fleming, Brian Green and Paul Dumbell from KPMG Restructuring, have been appointed joint administrators to Manchester-based Modus Ventures Limited. The firm owns more than 40 UK companies including many retail property developments such as the Grand Arcade, the UK’s first carbon-neutral shopping centre in Wigan, and the Houndshill Shopping Centre in Blackpool.
Fleming, UK head of restructuring at KPMG, said the group, like many companies within the property sector, has not been immune to the economic downturn and he believes it will be one of the first in a long line of commercial real estate casualties.
He added: "We predict a wave of fall outs in the commercial property market as the true value of losses becomes apparent. Indeed the wave of restructuring that will be required in the commercial property market could be the next big mile stone in this recession, following other landmark moments such as the fallout from structured investment vehicles (SIVs).
With the June quarter day fast approaching and with £43bn of debt repayments falling due this year, business rescue are set for busy a period of activity.