If you had £1700 to spare, you might have spent it on a visitor’s ticket to MIPIM, scheduled for next week. This is the annual knees-up held in Cannes, in the south of France, for the benefit of the con artists of the property business. In recent years, it has been a must for local authority leaders and various local government hangers-on to attend (all at council tax payers expense, of course – tickets, fares, hotels); but not this year. Due to the coronavirus contagion, the jamboree has been cancelled – or, rather, postponed until June. We shall see in June what happens.
A very visible presence at this monumentally expensive “do” would normally be Peel. This property speculation specialist will obviously be more than a little fretful at this missed opportunity to pull in investors, given its current troubles. Peel/Intu is, to put it bluntly, in a massive financial hole. It has suffered a 40% fall in its share price; rental income on its properties is down 9%; and its property valuations have been slashed by 22%. This is all down to a fundamental weakness in John Whittaker’s Peel/Intu property empire. It currently owes £4.5 billion, and is in desperate need to borrow another £1.5 billion to satisfy its creditors. It faces a June deadline set by its bankers to find an answer.
The MIPIM beanfeast must have been its last chance at finding someone to bail them out – it has now officially given up the ghost of raising that elusive £1.5 billion. That appears to leave them just two options. The first is to negotiate with their bankers; the second is to flog off as many assets as may be needed to keep the wolf away from the door. The latter seems to be the preferred option; hence, its hitherto failed attempts to sell off the Port of Liverpool, and John Lennon Airport. I say preferred option because, in the current economic climate, their bankers may not be amenable to bailing out the rag-bag assembly of companies that is Peel/Intu. I am only surprised that Joe Anderson has not yet surfaced with the offer of a loan from the Public Works Loan Board!!
Like it or loathe it, but this situation matters to the whole city-region, given the way in which local authorities have been beguiled in recent years by Peel’s sales patter. “Jam tomorrow”, has been their clarion call, but without any guarantees. For example, back in March, 2016, Peel Land and Property – one of Whittaker’s many interests – was promising all and sundry that it would be building 10,000 new houses in Liverpool and 13,500 in Wirral. I have heard many such promises from them, but we are now fifteen years into the original fifty year timetable which they set and promoted. How many houses have they actually built, or had built? How many of these can be classed as social housing?
I do wonder where this will all end, given Peel’s looming presence across each of our six boroughs. Adding Peel to the scam artists who appear to have focussed their activities on the city within the LCR (although the same people have spread their wings to such as Manchester, Leeds, Belfast, Cardiff and Stoke), one can only speculate what the final outcome might be. IF, for example, the much-vaunted Northern Powerhouse was transmuted into real money for the LCR, and IF the local authorities continue to display such a remarkable lack of nous (at best!) when dealing with the private sector, I can only see a further cycle of decline, compared to our competitor city-regions.
There are many reasons for being a Jeremiah about this. Time and again, local government appears to have failed to apply due diligence to the most obviously unfit “partners”. How else can one explain the ongoing Chinatown debacle, for instance? Yet it is far more than your common or garden cock-up. There is the amazing failure to collect literally millions owed to the public purse in the form of Section 106 money. How can this be? Is it simply ineptitude? Looking at Knowsley, it may be.
Knowsley Council takes a local business – El Pueblo restaurant – to court over the non-payment of £6500 of unpaid rates. Fair play to the council, says I – all power to their elbow. Then I read that at the same time, the council gave the same business a grant of £100,000 and a year’s free rent! There is something truly out of kilter with such a deal.
Is it any wonder that we seem to attract every con man under the sun? Business – both legitimate and not so legitimate – must laugh its socks off when they think of our city-region. The opportunities for them to cash in without restraint seem immense. Even when the huge amounts involved in fractional selling are taken into account, I see only official inertia. Look down the East Lancs Road. When these phoney developers dipped their toes into Manchester waters, the authorities there decided that they were having none of it. Police action began and investigations are still underway. Here, all we have is a deadly silence.