Icelandic banking crisis halts work on college campus homes development

PUBLISHED: 15:22 05 November 2008 | UPDATED: 13:43 06 May 2010

Concrete blocks across the entrance of the City Campus site

Concrete blocks across the entrance of the City Campus site

BUILDING work has been halted at a St Albans city-centre housing site because the developers have fallen victim to the Icelandic bank meltdown. Nicholas King Homes admitted this week that it had temporarily stopped work on flats it is building on the Oak

BUILDING work has been halted at a St Albans city-centre housing site because the developers have fallen victim to the Icelandic bank meltdown.

Nicholas King Homes admitted this week that it had temporarily stopped work on flats it is building on the Oaklands College City Campus site in Manor Road, St Albans.

Heritable, the bank dealing with the project, is part of Landsbanki which was nationalised last month in the Iceland banking crash.

Nicholas King Homes has already started to build the 267 flats on the site and has been marketing them but none are finished.

A spokesperson for the company said that they had little option but to temporarily suspend the work until they found out about their situation from Heritable.

The building firm is just one of a number of businesses, local authorities and charitable bodies which had money deposited in Icelandic Banks. Individual depositors are protected but not organisations.

Herts County Council confirmed that it had £28 million invested in Icelandic banks and Herts Police deposited £3 million which it is also as risk of losing.

The Local Government Association is working closely with the Government, administrators and the Icelandic authorities to try to resolve the situation.

Oaklands campaigner David Kaloczi said he understood that the college - which admitted this week that it did not know work had stopped - still owned the core part of the site and would benefit from a profit share when that land was developed.

That had been the arrangement when the land around the perimeter was originally sold to Fairview Homes which then sold it on to Nicholas King Homes, he maintained.

Mr Kaloczi said: "I can't imagine that the agreement was altered dramatically when it was transferred from Fairview to Nicholas King Homes. The college is hamstrung at the moment."

He pointed out that had Oaklands listened to residents who wanted to keep the buildings around the periphery of the site and see a much smaller-scale development when the City Campus development scheme was first proposed, it would have been built and the flats sold by now.

He is still fighting, eight years on, to get 23 Hatfield Road - the last remaining building on the perimeter - listed.

Mr Kaloczi added: "Work has definitely stopped on the site because a concrete block has gone across the entrance to the show homes.

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