CPC Group’s Richard Williams, left, non-executive chairman Michael Ayre, centre, and Christian Candy at its Albert House premises. (Picture by Tom Tardif, 0677492)
GUERNSEY-BASED property developer the CPC Group has around £200m. ready for the next favourable deal.
Speaking exclusively to the Guernsey Press before any UK newspapers, Christian Candy, one half of the renowned Candy & Candy design firm and founder of the group, said it was time to speak out in the light of recent speculation on the financial stability of his and his brother, Nick’s, businesses.
‘We are in an excellent financial position. We have consolidated at the right time through good judgement and some luck, but it means we can make strategic decisions about investments and be opportunistic if the time arises.’
Richard Williams, the group’s chief operating officer in Guernsey, agreed.
‘We have a cash war chest of around £200m. and can stand comfortably on the touchline and select the right opportunities.
‘The speed with which we can act will give us a competitive edge and assist us in this current climate. It may sound obvious, but people want to know that you are able to pay upon agreeing a transaction.’
Much of the recent negative speculation concerning the group related to joint ventures 9900 Wilshire, in Beverly Hills, Los Angeles, and Noho Square in central London. CPC was involved alongside Icelandic bank Kaupthing, which went into administration on 9 October as a result of the Icelandic financial crisis and thereby left the future of both projects up in the air.
That was coupled with the announcement in early November that the group was to sell its equity stake in Project Blue (Guernsey) Holdings, the joint-venture vehicle established with Qatari Diar to acquire the 12.8-acre Chelsea Barracks site for £959m. in April 2007.
Mr Candy explained that the press comment he had seen regarding how each of these three joint ventures had been affected by recent developments had painted the wrong picture.
In relation to Chelsea Barracks, he said, Qatari Diar had approached CPC Group to buy its equity share. He said he was happy with the transaction and despite what had been claimed in some quarters, the relationship with Qatari Diar was extremely good.
Candy & Candy is continuing to work on the site as development and planning manager, interior designer, interior architect, branding adviser and marketing consultant and the CPC Group continues to provide consultancy services.
‘Qatari Diar decided they preferred to own 100% of the project as Chelsea Barracks is to be their flagship,’ said Mr Candy. ‘On the back of the 100% ownership agreement, they have set up their own project office.’
According to Mr Candy, the agreement is governed by a confidentiality clause and he was not prepared to provide any further information, but in relation to 9900 Wilshire and Noho Square even Mr Candy admitted the situation was not clear cut.
He admitted to having lost around £5m. as a result of Kaupthing going under, but was confident the resolution reached was in the best interests of the CPC Group.
‘There has been much speculation over the joint ventures with Kaupthing – Noho Square and 9900 Wilshire. Agreement was reached with Kaupthing for CPC Group to exchange its stake in Noho Square for the Kaupthing stake in 9900 Wilshire in Beverly Hills.
‘This has allowed CPC Group to take control, with Richard Caring owning 10% of 9900 Wilshire, which is seen to be the west-coast equivalent of One ,Hyde Park.
‘While it is true that the lending banks have served a default notice, CPC Group is confident that the underlying debt can be restructured, allowing it to retain control of this prime asset. Our primary focus is One, Hyde Park and 9900 Wilshire.’
Mr Candy rated the chances of the Beverly Hills site being repossessed as slim and was confident an arrangement would soon be agreed between the banks and CPC Group.
‘It could be a loan extension, a reduction in the loan or increasing the loan margins or they could convert some of the debt into equity. But we are absolutely committed to Beverly Hills.’
Mr Williams said that in an ideal world they would still want to be involved in Noho Square as well as Beverly Hills, but the collapse of Kaupthing was in a way not all bad news because it resulted in CPC owning 90% of 9900 Wilshire.
‘The Los Angeles site is our preferred site every day.’
However, CPC Group could still end up owning Noho Square. Mr Williams said: ‘CPC will wait and see what bids are made and at the right price, we would go back in.
‘We are still the best people to take on the site because we understand what is involved and know more about it than anyone else.’
The three-acre site has been cleared and is ready for work to start.
Article posted on 1st December, 2008 - 2.30pm
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