Firm behind £100m Flaxby golf resort goes into liquidation

The company behind a proposed multi-million pound hotel and golf complex in North Yorkshire has gone into liquidation, less than a month after it started the application process to build an entire new town on the site.

A golfer at Flaxby Park Golf and Country Club.

Skelwith Leisure, a subsidiary of luxury development firm Skelwith Group, has gone into provisional liquidation, a company spokesman has confirmed, blaming the costs of a legal dispute over the ownership of the land at Flaxby Golf Course.

The company will next week do battle with the farming family, the Armstrongs, who sold the land in 2008 at the High Court after they became angry with the changes to the masterplan, and a lack of building work to date.

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A spokesperson for the Skelwith Group insisted today that both the High Court hearing and the planning application for a new town, complete with 2,213 homes shops, primary school, restaurants and a doctors’ surgery, will go ahead.

He said: “Because of the pressure and resources taken up with the litigation on the Flaxby Golf course site, one Skelwith company, Skelwith Leisure, has gone into provisional liquidation. We are working with the liquidator to resolve outstanding issues. The current legal dispute and planning process will continue.”

Flaxby was set to become the jewel in Yorkshire’s tourism crown when the Skelwith Group first proposed the £100 million country resort complete with 300-bed five star hotel and a golf course the company boasted was good enough to host the Ryder Cup when it opened in 2004.

Despite selling 158 rooms in the luxury hotel to investors, including England’s former cricket captain Michael Vaughan, work on the hotel which was granted planning permission in 2010 ground to a halt shortly after builders finished work on the £4 million roundabout near the A1 in 2014.

In November 2014 the Skelwith group announced new plans to build up to 2,500 houses on the 280 acre site, scrapping the golf course which it said was not profitable.

The Armstrong family were unhappy with the new masterplan and had grown frustrated with the seven-year wait for the £7 million sale price of the land so in January 2015 they decided to sell the golf course to ‘Flaxby Park’, a company owned by the Ward family.

In February, Skelwith secured an injunction blocking the sale between the Armstrongs and the Wards, claiming the Armstrongs undervalued the land in the sale to the Wards, citing £27.5 million as the actual value, based on the hope value of the housing scheme.

The case is expected to go to the High Court on Monday.

This comes as Harrogate Borough Council starts a consultation asking where the 6,346 homes the district needs to provide in the next 20 years should be built. The idea of building a new settlement in the A1 corridor has proved popular in recent months with residents who don’t want to see large scale developments in Harrogate or Knaresborough.

A provisional liquidator can be appointed by the court only after a winding up petition has been presented and there is concern the company’s affairs won’t be properly conducted before a court order is imposed.

The main reason for appointing a provisional liquidator is to preserve the company’s assets.

Eleanor Hewitt, chair of a campaign group opposing the development, said she ‘was not surprised’ by Skelwith Group’s announcement.

She said: “There are just so many what ifs and maybes it is hard to know what will happen there, we want developers who are concerned about Knaresborough as a whole, not just people who going after the money like Skelwith were.”

As well as its site at Flaxby, Skelwith also owns the Raithwaite Estate on the North Yorkshire coast near Whitby, which features two hotels, cottages and is set in 100 acres of grounds and gardens.

On its website, Skelwith describes itself as “a developer of quality, landmark mixed use developments throughout the United Kingdom”.

It adds: “We have become an owner/operator of luxury hotel resorts, high end office schemes and various commercial properties. The company has been built on a strong core of experienced individuals who have a history of success in delivering major and complex developments.

“Despite the uncertain economic times, Skelwith have maintained and increased their business and asset values via a clear strategy of growth involving dynamic and visionary funding methods away from the mainstream lenders.”