Knowle sale delayed as purchaser fails to complete by agreed date
- Credit: Archant
East Devon District Council has said the sale of its former Knowle has been delayed, with the purchaser saying it should be able to complete in the New Year.
However, developer PegasusLife said it remains committed to completing the purchase of Knowle.
In the statement East Devon District Council said: "East Devon District Council confirms that the sale of Knowle, its former Sidmouth offices, has not yet occurred as the developer has failed to complete by the agreed contract date of Wednesday, December 18.
"Lifestory Group Limited (formerly known as PegasusLife Ltd) were recently in contact with the council seeking an extension rather than meet their existing contracted obligation to pay the outstanding total by December 18.
"While Lifestory have outlined that they believe they can complete in the New Year, following external legal advice, the council has resolved to protect its position which means that the council will commence legal proceedings to secure the agreed and contracted £9m payment as well as any associated costs and damages.
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"The council considers this a necessary and appropriate step as it has an over-riding responsibility to protect the public purse."
Councillor Ben Ingham, Leader of the council, said: "It is deeply disappointing and surprising that a developer such as Lifestory Group Limited should seek an extension of this nature.
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"The council has taken expert legal advice which has confirmed the strength of the council's position and remains confident that it will secure the £9m sale price plus associated costs and damages."
The statement continued: "There is no immediate impact on council finances for this financial year. As legal proceedings can take time the council will consider the position again if Lifestory do not settle the matter early in the New Year.
"In the meantime the council will continue to maintain security and other arrangements on the Knowle site."
Mark Dickinson, chief executive officer of PegasusLife, said: "Unfortunately, due to the need to secure funding from alternative sources we have been unable to meet the 18th December sale and purchase completion date.
"We believe we will be in a position to do so by 14th January 2020.
"This position has been shared with the council over the past couple of months.
"We hope to be able to continue to work in a positive manner with the council."