Credit crunch will not derail Locarno

7:50am Friday 10th October 2008

Comments (4)   Have your say »

By James Wallin »

AN exciting redevelopment of a Swindon landmark will go ahead despite the credit crunch.

Work to develop the Locarno is still set to start early next year, despite the developer of the scheme going into administration.

The managing director of Bach Homes has pledged that developments in Old Town at the Locarno and Victoria Hospital and in Wootton Bassett will not be affected by the financial problems hitting the business.

The directors of the company submitted an application for its administration on Monday, after arrangements to sell it to a consortium of investors fell through.

Harrisons, of Reading, are the appointed administrators of the company.

Steve Rosier, the managing director of Bach Homes, said the firm had been a victim of the credit crunch, but that developments like the Locarno were not under threat.

He said: “Bach Homes Holdings is the shareholder in a number of subsidiary companies, which have been affected by the credit crunch.

“These companies control a valuable land bank, which it is believed will be attractive to investors and allow fresh finance to be raised.

“The proposed developments at Victoria Hospital, Wootton Bassett and the Locarno are not affected by this administration and finance is being raised to allow these developments to commence early next year.

“The company had reached agreement to sell shares in the company to a consortium of investors last May.

“This arrangement would provide working capital for the business and would have avoided administration. Disappointingly the deal fell through at the eleventh hour, a few weeks ago.

“Whilst the company is currently speaking with other possible investors, time will be required. Under these circumstances it was considered necessary to place the company in the hands of Harrisons.

“There remain good prospects of the company being refinanced and returned as a going concern.”

A spokesman for McCarthy & Stone, which is developing the southern sector of the site, said: “We are assessing the situation.”

A Swindon Council spokesman said: “It’s clearly worrying that Bach Homes is having financial difficulties, but we are reassured by their statement that the situation will not affect their two developments in Swindon, which includes the Locarno.

“We will be watching the situation closely, but ultimately it’s out of the council’s hands. It’s another reminder of the difficult economic times we are currently facing.”