Crest Nicholson has warned shareholders it stands to lose almost £16 million on Farnham’s long-delayed Brightwells Yard regeneration scheme.
The FTSE 100 developer won the contract to build out the mixed-used regeneration project on land south of East Street from Waverley Borough Council in 2003.
But after struggling to find financial backers for the project and a litany of planning, legal and construction delays, the troubled development is only now approaching completion 20 years later.
Crest set provisions at £11.6m to cover losses on Brightwells at the half-year point. But in a profits warning to shareholders on Monday, it added this has now been revised up by a further £4m.
Its pre-October end-of-year trading update stated: “In addition to a poorer trading environment, the group has also recorded a further £4m cost movement in the second half at Brightwells Yard, Farnham.
“This site is a highly-complex urban regeneration and mixed-use development scheme with a build programme expected to conclude by the end of the calendar year.”
It comes after Crest was forced to rebuild the roof at the Grade II-listed Brightwell House at the heart of the development for a second time following a planning breach.
Last week the Herald reported the fit-out for the new six-screen Reel Cinema at Brightwells Yard has now begun, with an opening date anticipated in early-2024.
Nando’s, Coppa Club and local chain Heaven’s Kitchen Mediterranean Steakhouse are also confirmed to be opening restaurants in the new development.
There are no further occupiers yet confirmed for the remainder of Brightwells’ 25 retail units – but Crest states it is in advanced discussions with numerous retailers.
Surrey County Council is believed to have pledged £57m for a long lease on the commercial units, subject to conditions being met.
This includes ‘pre-let’ agreements being in place for 30 per cent of the units, as well as the council receiving a higher income from the rent of the commercial units than the interest on its loan.
Many of Brightwells’ 240 apartments are already occupied.