<p>Last year at the height of the credit crunch, the Princegate/Paradigm jv worked to find a solution for revitalising a scheme that had become uneconomic in the downturn. The client was an established property development and investment group that mainly focused on residential development in the south east of England. The client was, and is, a conservative, low-geared company that has acted in a prudent fashion during the property downturn by focusing and investing in the areas of its business that will still succeed in the current property climate. </p> <p>Its financing was supplied from a number of different banks, including an overseas bank with a UK property development lending arm. Due to liquidity issues in the bank’s native country, the overseas bank’s lending arm was “strongly encouraging” its customers (including the client) to repay or refinance their outstanding loans. This pressure coupled with the downturn in property prices made the development project uneconomic and thus between the funder wishing to withdraw and the lack of future profit streams the project looks untenable. This came to a head during the height of the credit crunch last year which posed a particularly difficult challenge for the client, which had sizeable loans …