Case study: Challenge House

Challenge House was a small office block in Croydon was underperforming in both occupancy and condition and required considerable improvements. Located in a prime area, with transport links, such as tram stops nearby, and easy access to major roads connecting to the M25 and Gatwick Airport.

Menzies’ lead Insolvency Practitioner, Simon Underwood, was appointed receiver to take a more strategic, value-led approach to asset management and the eventual sale of the property.

• Challenge House saw a decrease in occupancy, from 50% to 15% in a short time, and was in need of significant refurbishment to improve its overall condition.

• To Improve occupancy levels, an on-site manager was appointed. This strategy resulted in the building reaching maximum occupancy.
• The result was achieved through a combination of asset management and a well-executed sales process.
• When appointing a receiver, there’s typically a choice between an insolvency practitioner (IP) and a surveyor. Surveyors are generally skilled in asset management and sales, but their approach can sometimes be one dimensional. In contrast, Insolvency Practitioners often bring broader experience, particularly in managing complex projects.
• In this instance, the decision came down to whether a quick sale was the priority, or whether value could be improved first.
• In cases where improving the property/asset’s value before sale is important, a strategic approach is needed.
• Here, an IP was appointed as the receiver to firstly oversee the property value improvement followed by a sales process.

• Once occupancy levels were maximised, the building was put on the market and successfully sold. The building’s full occupancy and recent upgrades made it an attractive investment, leading to a successful sale.

Through a structured and hands-on strategy, including on-site management and essential property improvements, Challenge House achieved full occupancy, significantly enhancing its market appeal. This approach, led by an experienced Insolvency Practitioner rather than a traditional surveyor, ensured that value was maximised ahead of sale. The result was a successful transaction, delivering a positive outcome for stakeholders and demonstrating the benefits of a tailored, asset-focused insolvency and recovery strategy