Developers row over profits from sale of £24m Sheffield office block
A developer says he has not been paid more than a year after a Sheffield office block sold for £24m.
David Topham, chief executive of CTP, says the sale of 3 St Paul’s Place should have triggered a payment of 50 per cent of the profits - a six-figure sum - from development partner U+I.
But more than 400 days later he is still waiting for agreed development management fees, he says.
The two firms set up a ‘single purpose vehicle’ owned and controlled by U+I after agreeing to build 3 St Paul’s together in 2014.
The block opened on June 24 2016 and was bought on March 8 last year by M&G Real Estate for £24m.
Mr Topham said: “We remain disappointed that this matter remains outstanding so long after the completion of this successful development, but we remain hopeful that, perhaps, it will be resolved shortly.”
A U+I spokeswoman said the project suffered significant delay and increased construction costs and under a legal agreement no payments were due to CTP.
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They had offered an ‘ex gratia’ payment to recognise Mr Topham’s hard work, but it had been rejected.
She added: “We continue to offer a dialogue to resolve the matter amicably including utilising the dispute resolution mechanism within the legal agreement or CTP has, of course, recourse to the courts should it so choose.
“U+I would also confirm that CTP has received profit payments relating to other projects under the same legal agreement.
“Most importantly, the Office 3 regeneration project was a great success bringing much needed Grade A office accommodation to the Sheffield market. The calibre of the tenants secured is further testament to this.”
It is home to civil engineers Arup, architects BDP and HLM, Handelsbanken, ed-tech firm Tes and lawyers Freeths. US software firm Ansys is moving in later this year. 3 St Paul’s - the final element of the £200m Heart of the City project - was paid for by a ‘basket’ of lenders, including Barclays Bank and a £6.8m loan of public money from the SCR Jessica Fund. It also benefited from a Sheffield City Council guarantee to pay rents if it stood empty.