Receivers take on two leisure developments

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The Independent Online
A BUMPER year for corporate hospitality has failed to save two separate leisure developments that have gone into receivership: John Broome's 1,200-acre Carden Park venture in Cheshire and Kettering Leisure Village, a pounds 15m development in Northamptonshire.

Mr Broome failed to turn Battersea power station into a leisure palace and the London landmark has lain derelict for seven years. His Battersea Leisure group went into liquidation this summer. He has now been forced by Carden's bankers, Bank of Scotland, to work with the receivers Grant Thornton to save his latest venture.

An unconnected business, the Kettering development was started by the private investors' group Redelco as a leisure complex, but has been unable to attract sufficient crowds. The receivers Price Waterhouse were appointed at the directors' request, on behalf of Barlcays Bank. Carden employs 70 people, and the manager, Mark Grundy of Grant Thornton, says that, although staffing levels are under review, there are no immediate plans for redundancies.

Kettering employs 130 full- and part-time staff, and the receivers are assessing their options. They hope they can avoid closing it down.

Both developments reflect the difficulty of launching a venture in the depths of recession. One leisure analyst noted that despite this being a bumper year for corporate hospitality many property-based developments have been dramatically over-capitalised and are now on sale for up to 80 per cent discounts to their original cost.

Richard Rees of Price Waterhouse said: 'The timing of this venture was bold. It was developed in the depths of the recession and has not yet achieved the budgeted level of activity.

'The directors have been working hard to find an investor for several months, but it became clear that continued trading could not be sustained without a substantial injection of funds.

'I don't expect to receive this pounds 15m back. The business is not viable as it stands. It needs a change of focus.'

Mr Rees added that although there had been interest from potential buyers, 'my task in the first few days will be to stabilise the position rather than open negotiations with prospective purchasers'.

Mr Broome has poured pounds 22m into Carden Park, one of Europe's most lavish developments. According to Mr Grundy it consists of '1,200 acres of beautiful Cheshire countryside encompassing an 80-bed four star hotel, a championship golf course with 300 members and a deer park.

'It offers hospitality for corporate clients, including shooting, fishing, horseriding and falconry. We are working closely with Mr Broome to keep it going, and make sure its future is secured. We hope to sell it or refinance it.'

Last year Mr Broome sold his home, Stretton Hall on the Carden estate, for pounds 3m in an effort to meet development costs.

Carden's hotel, the Birches, has parted company with its manager, Lyric Hotels, when it completed a six-month contract. It is understood Lyric would be happy to go back in and help the receivers.

Mr Broome is still dealing with the liquidation of Battersea Leisure. The liquidator, Alan Lewis of the accountants Arthur Andersen, has issued a writ on behalf of Security Pacific, which wants to know how pounds 16m out of a pounds 22m sum paid by it was allocated.

Mr Lewis recently withdrew the writ after Mr Broome agreed to waive his rights under the time limit for legal action and to deliver certain documents detailing what happened to the funds. Arthur Andersen said yesterday that it was still waiting for the documents.

Mr Boome is also the subject of litigation from the contractors Robert McAlpine.

(Photograph omitted)

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