Our restructuring team, working with client Stephen Hunt of Griffins, has secured a landmark High Court ruling and sale of 10 care homes that were subject to a failed ‘fractional ownership’ or ‘room investment’ scheme. This success could unlock recoveries for investors affected by failed property-backed investment schemes across the UK.
The Qualia Group operated a portfolio of care homes across the North of England and raised more than £53m from retail investors around the world before it collapsed into insolvency in 2022. The homes were subject to hundreds of long leases sold to investors that prevented their sale.
Working closely with Griffins, the Gateley team successfully obtained High Court orders under the Financial Services and Markets Act 2000, enabling the care homes to be sold free of their long leases. The proceeds are being distributed to the investors affected by the scheme. Over 600 residents have been protected, along with a similar number of jobs.
A reported judgment is anticipated, which will provide a blueprint for other failed property-backed investment schemes.
The Gateley Legal team advising on this matter was led by partner and head of restructuring Matthew Brown, supported by associate Niall Crossley, solicitors Alex Marks and Imogen Sheppard, graduate solicitor apprentice Dan Flint and legal secretary Jackie Giddings. The team was further supported by specialists from around the business.