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Problems with Caro Lettings City Point investment


rose_l

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Hi, my husband and I invested in City Point student accommodation in Liverpool managed by Caro Lettings, four years ago. We've had several expected payments postponed, and they are really bad at communicating with us. Deadlines for payments are missed with no information forthcoming. What can we do about this problem? What have other people experienced with student accommodation investments?

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Hello @rose_l

Your starting point would be reviewing the lease and sub-lease(s).  You need to understand the key terms: for example, who is actually owing you money (the agent might only be an intermediary instead of the person owing you money), the payment conditions (such as whether there is any overall occupancy rate or duration requirements), payment schedule, any provision that governs any delay of payment and any automatic waiver.  You would probably also need evidence that your unit has been occupied in the relevant time.

You will also need to know whether you are renting to the students directly (this would be apparent from the contract) or to another company, who is then responsible for renting / contracting with students.  The latter (i.e. via another company) creates some issues, because you would lose your biggest tool (a statutory demand, which could force the company to go into insolvency and therefore a very aggressive move) due to the Corporate Insolvency & Governance Act 2020 (which came in as a result of COVID, giving certain reliefs for businesses).  However, you should check with a lawyer to determine your options, since the law has been moving very quickly in this area.

Assuming the statutory demand route is not available and it is the case where you are not directly renting to students, if it is clear that all the conditions and requirements have been satisfied, and there is no other issue, you could initate legal proceedings (by way of a pre-action letter) to claim for the debt owed to you.  I would be surprised if they don't take you seriously at this point.

One point to note is that you should be entitled to interest for any amount unpaid.

Hope these helps.

For the avoidance of doubt, the above (a) does not constitute legal advice (and no lawyer-client relationship is formed in any way) and (b) is set out for your reference only.  You should seek formal legal advice for your matter.

Kerry

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  • 1 month later...

Hi Rose 

You are not alone ! A friend spotted your post as we are looking in to how we resolve the same problem . We invested in City Point student accommodation in November 2018 and like you have had difficulties with receiving our assured payments. Our initial payment was received late but then we received regular quarterly payments for a year until the pandemic struck. Since then we have had the same issues as you late payments and no communication. I have received the last two payments only after threatening legal action . We are shortly due to start having to pay maintenance charges and we are really worried we will receive nothing in return. It may be useful to link up ?

Marianne

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  • 9 months later...

My wife and I have had the exact same issues as described above. They even wrote to us saying that issues with other developments had caused delay in reviewing payments. Their level of contact is embarrassing to the point where we don't know when normal payments should even be made. If there is room for joint action to be taken please let me know if possible. We have written a pre action letter to them previously and recieved the full amount owed at that time but now its anyone's guess as to what is really going on.

I can't seem to find a direct line to anyone who is aware of the procedure to talk to. Do you know if they have a number for investors to call?

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  • 2 weeks later...

Hi, thanks for posting on the forum about Caro Lettings - the company is basically awful at communicating and makes it as hard as possible to reach them. The only number we have, I think, is 0800 008 7888, but it has rarely been answered. Lillian Gorman has left now and there is no other named person who you can contact! The only way we get any email communication is to mention legal action. We are still unsure about the whole scheme as it looks like they are having trouble getting tenants in for the whole academic year. It's just not a good situation to be in and we haven't decided how to proceed yet.

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It gladdens my heart that I can find other Investors in the net of Caro Lettings in respect of City Point, I may comment here that this is the worst Managers I have ever experienced in my property investment history. They seldomly reply to emails and they are cool not honouring any payment date without feeling an obligation that they owe to investors. They collect their fees as and when due and feel less concerned about the interest of Investors. I am available for any class action we may need to take to protect our investments in this property,

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  • 2 weeks later...

Thanks for getting in touch. We looked into selling the property through RW Invest who sold it to us but basically the company doesn't re-list Investments they have sold. I am at a loss to know what to do right now. We have been told our room will have no tenant for the second half of the year. Have others heard the same story from Caro?

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In respect of Caro Lettings, it will be good for us to discuss our common problems. Can we commence communication through emails to think through these issues together. My email is kingsolomon1935@gmail.com. The service charge imposed by Caro is eroding our investment. Very soon, the entire capital will be eroded. Lets get together to discuss way forward.

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