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Candys drop out of Noho plan and default on £221m loan
Hugo Duncan30.10.08
THE Candy brothers have abandoned a flagship property scheme in London and failed to repay a loan for a project in Beverly Hills.
Nick and Christian Candy have pulled out of their involvement in the redevelopment of the Middlesex Hospital north of Oxford Street, renamed Noho Square.
CPC Group, the investment firm run by Christian, also defaulted on a $365million (£221.2million) loan for prime land bought last year in Beverly Hills, where the firm plans to build apartments.
The loan, from a syndicate led by Credit Suisse, was due to be repaid this month and attempts to extend it collapsed.
Christian is expected to fly to New York to hammer out an agreement in the coming days. It underlines the crisis facing the brothers as the property market in London collapses, availability of cash for construction plummets, and the brothers' relationship with troubled Icelandic bank Kaupthing unravels.
CPC and interior design firm Candy & Candy are behind some of London's biggest housing projects, including One Hyde Park and Chelsea Barracks. Kaupthing was the brothers' investment partner on the Noho Square and Beverly Hills schemes, but was recently nationalised by the Icelandic government as the island's banking system collapsed.
CPC had planned to build hundreds of apartments on the three-acre Noho Square site. But now it has walked away from the project, with losses of £5 million, and transferred its share to Kaupthing.
In return, CPC has taken full own-ership of the Beverly Hills 9900 Wilshire development, along with another partner, restaurateur Richard Caring.
A CPC spokesman said: "The agreement with Kaupthing will see Candy & Candy remain in its role as development managers, interior designers and in a sales and marketing capacity for the Wilshire project.
"For Noho Square, Candy & Candy will cease to continue as development managers, interior designers and sales and marketing consultants."
The Candys and Kaupthing bought the Noho Square site in 2006 for £175 million, which was seen at the time as about £25 million above its real value. It is now worth between £50 million and £100 million.
The One Hyde park development in Knightsbridge is set to be the most exclusive ever built in London, with apartments selling to wealthy foreigners for tens of millions of pounds.
However, the proposals for Chelsea Barracks, which include 600 homes and a hotel, have run into opposition from residents in the area, who claim that the design is not fit for the site.
Reader views (10)
They have left behind them a wasteland. This was corporate vandalism at its worst.
- David Marriott, Delta, BC, Canada
THE Candy brothers will survive, sure there will be cancellations and new plans, everyone will cut their cloth accordingly.
What the Candy brothers brought to the table was a refreshing idea in residential deveopment never before dreamed of by developers and their efforts lured the world's richest into London, with all the benefits that come with them.
I, for one believe they will see the recession through and I'm sure they have a few surprises up their sleeves yet to stun the development market.
- Kevin C, London N21
C.Taylor: Why are these even worse?
These are the people who drive this country forward. If they make money, the government will make money (trough taxes) and there will be more money for the government to spend on people like you, who can't be bothered working and claiming unemployment benefits and only complain about other people who have more money then you.
If all of you winchers out there would actually use the wasted energy on working and being creative you could make this country great again. Instead of being jealous and complain you could create something great.
- Eric, London
The Brothers have one foot in the London property market boat and another foot in the Icelandic boat, and they are both sinking. Bon voyage, Candys, and say hello to the other Brothers called Lehman when you get to the bottom of the lake.
- Smarter Than Candy, London
I can't believe the negativity of the comments against the Candys, if it wasn't for people like these London would still be a village. We need constant regeneration in our city to keep it one of the best in the world - plus think how many construction jobs these developments would have created - and I think it is a real shame that people are enjoying watching their downfall.
- Jane, London
NoHo was quite an appropriate name for the Middlesex site after all.... will arrogance turn to humility we wonder and these boys need some?
- Fitzrovia Resident, London, UK
That one on the left's an ugly blighter isn't he?
Why the long face Mister Candy?
- Dunc, London
FATCATS. Why blame the bankers, these people are even worse.
- C.Taylor, UK
Given the traffic chaos in Knightsbridge that these brothers are causing to regular citizens, I hope they go bust.
- Harry, London
We were considering investing in a property in Noho-pe Square. Thank god we didn't put the money down.
Hard Candy.
- Big Andy, London
