Securitisation firm White Tower is suing chartered surveyors Colliers International for as much as £34.8m for the negligent valuation of a £1.15bn property portfolio.
According to court documents lodged at London’s Commercial Court, White Tower alleges that Colliers, which is now in liquidation, overvalued five of the nine properties in the portfolio by millions of pounds.
The claim relates to a 2006 securitisation of nine office properties, mostly in Central London.
The portfolio was securitised using a loan from French bank Société Générale. According to White Tower’s claim, prior to issuing the loan, SocGen hired Colliers to write an independent valuation report on each of the properties in the portfolio to ensure that it provided “acceptable security” based on a loan-to-value ratio of 83%.
However, in 2009 a valuation of the portfolio showed that it “was in breach of a key loan-to-value ratio contained in the credit agreement. Subsequently the borrowers defaulted under the senior loan”.
The portfolio was later sold for £1,130,256,504, according to the claim.
The claim highlights five properties that White Tower claims were overvalued, and compares the “highest non-negligent valuation” next to Colliers’ valuation.
According to court documents, Alban Gate, London EC2’s highest non-negligent valuation, was valued at £386.7m compared with Colliers’ valuation of £410m.
Sampson House, London SE1’s highest non-negligent valuation, was valued at £182.2m compared with Colliers’ valuation of £212.5m.
New Court, London WC2’s highest non-negligent valuation, was valued at £77.62m compared with Colliers’ valuation of £86m.
Millennium Bridge House, London EC4’s highest non-negligent valuation, was valued at £116.7m compared with Colliers’ valuation of £134.25m.
A complex of properties on Victoria Embankment, London EC4’s highest non-negligent valuation, was valued at £326.9m compared with Colliers’ valuation of £350m.
The claim says that White Tower seeks compensation for loss of either £34,850,809 or £19,743,194 depending on how the court chooses to assess the claim.
The case is scheduled to go to trial early next month.
