I have also had difficulty getting any information out of the management company. They sometimes answer my questions and tell me what I want to hear regarding the contract, but it still comes back unchanged. Where is the guarantee that they have promised? What happened to index linking the income, only their costs are index linked? They demand payment upfront, but will not deliver anything for 6 months, and do not have to pay anything if parts of the development are unfinished – this gives them a huge scope to duck out if things are not going well. They also include an 18 month notice period, this is ridiculous, and only serves to ensure their income. 

 

In summary the contract is heavily biased to the management company (I would not sign it in its present form), and there appears to be no guarantee and absolutely no activity on the rental front. They appear to be spending absolutely nothing on marketing, and we have not heard from any satisfied customers yet regarding the rental scheme.

 

Completing on this really looks unappealing, Peninsula’s recent threats to clients is their way of balancing the alternatives and making not completing look just as unappealing.    They have sold this development on the back of the rental scheme, but cleverly excluded it from the purchase contract. Now they look as though they are short of cash their acts are all short term measures to conserve cash by not spending on things including the rental side, and generate as much cash as possible by any means. Good luck to those who are deciding what to do, it is not an easy decision.

 Firstly there is the court case about the legality of the development. I don’t know the details but it appears the Peninsula have done nothing wrong and are caught in the middle. Hopefully common sense will prevail, but you never know.

 

Secondly postings from purchasers of future phases of the development being forced by Peninsula into current phases. This means earlier cash flow for Peninsula (if they can do this) and means that they do not have to complete later phases, either because sales have dried up or because there is no cash to complete them.

 

Thirdly the postings about Peninsula not refunding deposits on past developments when they have not been completed.

 

And finally their recent short sighted threat to their clients including threatening to take UK assets, i.e. people’s houses. This can only mean that desperate times call for desperate measures and leads to the conclusion that they need the cash. If sales were poor before, they will be non existent now, nobody in their right mind would purchase from them after their threats.

 

What could this mean for current purchasers? If Peninsula are that desperate for cash there will be the temptation to cut corners and finish phases quickly (they seem to be rushing on with Fairways). They could finish the apartments but maybe not finish the surrounding infrastructure as this is discretionary spend. Would they have the money to finish if sales are falling through? There is already a clause in the (terrible) rental contract that no income will be received in the first 6 months to allow everything to be finished.  There also appear to be clauses in the rental agreement that if certain facilities are not available they do not have to pay out at all.  Purchasers are buying into the development as a whole, not just individual apartments.  There appears to be a risk that owners will complete on apartments finished to tick all the boxes to enable a sale, but are on a development that will not be completed fully in a reasonable period.

 

The consequences are people would not want to rent or stay there which would reduce rental income, and there will be unsold apartments from people who can’t complete reducing the value of the properties.

 

Peninsula’s actions can only lead to negative conclusions about their financial situation and their attitude to clients. Whilst the thought of not completing and then not only losing the deposit but also getting sued by them is not appealing, completing (assuming there are people left who can afford to) is equally unappealing at the moment. Any comments and other views on Peninsula would be appreciated…I notice that the forum has gone very quiet, I wonder why? Could any current owners post on their experiences to date?