JUNE 2013


There have been a lot of developers failing and a lot of people losing a lot of money. Too many people. Too much money. Can anything be done to stop - or, even, reduce - this? If so, what?


GARETH FATCHETT Director, Regulatory Legal Tel: +44 1384 426 400


of those funded by way of ‘off - plan’ sales. As Simon Morris, MD of MASA International pointed out, his company has sold 30,000 houses over the last 30 years with only one dispute that ever reached court: a dispute he won.


But the serious question remains: Is it acceptable for an “investment” product to have a failure rate of 40% or more? We think not.


WHY DOES IT HAPPEN?


Gareth Fatchett was clear that there was an element of criminality in


NEIL HEANEY CEO of Judicare Tel: +44 1438 840258


many of these failures. However, all our other guests suggested that there was more to it than that and Gareth Fatchett agreed. In fact, there was a remarkable consensus about the causes of failure. In the large majority of cases, the failure is a commercial failure. Some failures can be blamed solely upon external factors and the general economic crash. However, failure is, often, precipitated by external factors but its root cause often lies in the inexperience, naivety and in the lack of capital of


SIMON MORRIS


CEO of MASA International Tel: +44 208 686 4696


the developer.


Many developers, some very experienced, expanded too rapidly and were unable to withstand the crash of 2007/2008 when it came. Many others, with little or no experience, took on fi rst projects far bigger than were, with 20-20 hindsight, prudent.


Many new developers were attracted to the industry by the prospect of substantial profi ts. They failed to appreciate the full extent of the problems associated with completing a development


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