The North East development company, High Street Group, is likely to be wound up after administrators determined they could not recover funds for creditors. Known for constructing Hadrian’s Tower, Newcastle’s tallest building, and several other major projects, the company entered administration in 2021 with debts exceeding £200m. This included over £100m from individual investors who are unlikely to recoup their investments.

The administrators’ report revealed that High Street Group raised funds through high-interest loan notes but struggled when many investors demanded early redemptions. Although there were hopes that Hadrian Real Estate—an offshoot of High Street Group under new management—would provide some returns by taking over former projects, the administrators now believe these projects will not yield financial returns for several years.

Since the administration cannot meet its objectives of property realisation and creditor distribution, an application has been made to the High Court to place the company into compulsory liquidation. A hearing is scheduled for August 16, where it is expected that the company will be officially wound up, with the Official Receiver appointed as liquidator.

One of High Street Group’s subsidiaries went into administration in 2019 after failing to repay an overseas lender, indicating broader financial instability within the group. The administrators’ new report indicates loan note holders are owed £123.6m, HMRC has identified a £1m liability, and unsecured creditors are owed an additional £87.7m. 

High Street Group’s most recent accounts show a profit of approximately £1.6 million. The company’s accounts were significantly delayed, and two separate auditors resigned. Broader economic conditions, including the impacts of the pandemic, rising costs, and economic uncertainty, added pressure to the company’s operations and financial health.

These issues suggested underlying financial and operational problems, eroding investor and creditor confidence. The construction and development sector faced specific challenges, such as supply chain disruptions and rising costs, which likely compounded the company’s difficulties.