A group of Northern Ireland-based property companies which owe their creditors more than £45m have been placed into receivership.
The list of companies includes Varren Properties, Varren Industrial Estates and Vinegar Properties and all were financed by Bank of Scotland Ireland (BoSI), now part of Lloyds TSB.
Debts of £80m
Six other related firms, including Herd Estates, have been placed into administration. Their accounts suggest they owe at least a further £35m, bringing the total to £80m.
KPMG in Scotland are handling the insolvency. They say “Continuing difficult market conditions within the property sector have unfortunately led to the insolvency of 17 companies within the Herd Group… Every effort will now be made to secure a buyer for the portfolio of properties.”
Catastrophic Losses for the Bank
Bank of Scotland Ireland (BoSI) was a property-focused bank which ran up catastrophic losses in the Irish crash. The bank was effectively closed by its owners, Lloyds, last year and its loan book is being run-down. According to a statement from LLoyds in November, 67% of loans in its Irish business are now classed as impaired, meaning the loans are not being repaid in line with their original terms and conditions. In many cases the loans are unlikely to be repaid at all.
More Properties up for auction soon?
This could be a sign of more to come as more developers and builders throughout the UK go out of business as bank are expected to tighten their lending criteria in 2012. Its only a matter of time before some of the properties start to appear in future house auctions.

Twenty three market towns have an average house price exceeding £300,000; only four are outside southern England. Wetherby in West Yorkshire is the most expensive market town outside southern England with an average house price of £313,802.

In the report Nitesh Patel, housing economist at Lloyds TSB explains: “The popularity of living in market towns is clearly evident from the substantial increases in average house prices seen over the past decade, together with the significant premium that many of them command over their neighbouring towns.
Many of these towns offer an attractive balance between being close to the countryside and ease of access to the road and rail networks that allow residents to commute to work.”

Check our list of Local Auctioneers to find market town properties for auction over the next 2-3 months.