Two companies forming part of Grand Designs presenter Kevin McCloud’s eco-friendly property business Happiness Architecture Beauty (HAB) have gone into liquidation.
Investors had been attracted to HAB Land and subsidiary HAB Land Finance by a multimillion pound fundraising scheme that promised of returns of up to 9 per cent a year, but The Guardian revealed in August that they were facing the loss of up to 97 per cent of their money. The liquidation of both companies is being managed by KPMG.
BAH Restructuring had taken a controlling interest in HAB Land earlier in the year, but has also now gone into liquidation.
The news follows a series of criticisms for another of McCloud’s companies, HAB Housing, with investors complaining they hadn’t received “a penny of what they had been told to expect”. Residents near a HAB Housing development in Kings Worthy, near Winchester in Hampshire, have also complained that the development – which should have been completed last year – looked like “bomb site”.
While McCloud resigned as a director of both HAB Land and HAB Land Finance in early 2018, he remains a director of HAB Housing, which is unaffected by the liquidations.
HAB Housing’s directors had, however, recently acquired majority ownership of HAB Land, following the news in July that HAB Housing owed nearly £1.6m to HAB Land. The Guardian says it remains unclear how much of the debt had been paid and whether or not it had contributed to HAB Land’s difficulties.
HAB Land was launched in 2014 to find land for projects in Winchester and Oxford, with HAB Land Finance set up two years later to raise funds from investors. A “mini-bond” scheme offered by HAB Land in 2017 saw 300 small investors put in a total of £2.4m, with a promise of a 7-9 per cent return over five years plus all their capital back in 2022. They had later been warned they faced losing almost all their money and were asked to back a bond restructuring, but rejected it in September.
KPMG director and joint liquidator James Bennett said: “The directors have reported that higher-than-anticipated design and project management costs, coupled with delays to the delivery of the sites, resulted in the companies experiencing significant liquidity issues. After being unable to raise further finance or renegotiate existing liabilities, the directors took the difficult decision to instigate liquidations proceedings.”
A HAB Land statement said two subsidiary companies controlling the Kings Worthy site and a site in Cumnor Hill, near Oxford, “remain unaffected, as does HAB Housing at this time”. HAB Land spokesperson and director Simon Bullock said: “This has meant that there is what we hope to be a temporary pause on the remaining works on the sites. We continue to explore all options to enable these sites to be fully completed.”