Commercial Conversion — The Carlill, Whitby | Update #2

Commercial Conversion of The Carlill in Whitby to 15 Holiday Apartments — one of the property developments I’m involved in. Video update #2 with Property Developer – Andrew Bartlett.

Scroll down for the Show Notes to purchase one of the last apartments and to see Video #1.

Show Notes

Click Here for information on purchasing one of the last remaining Holiday Apartments

Watch the first video on the Carlill, Whitby development

To Contact Andrew Bartlett

Andrew Bartlett on Facebook

Andrew Bartlett on LinkedIn

Transcript

So today is the second video in the series on the commercial conversion of the Carlill in Whitby where we’re converting it into 15 holiday apartments so it’s one of the developments that I’m involved in.

So I’m George Choy and welcome back for another episode on the Sarah and George Choy property podcast.

If you want to learn how to become financially free so you can spend time with your family traveling and pursuing your passions then click that subscribe button now so you don’t miss a thing.

So these luxury apartments you know they’re they’re on the most prestigious road in the whole of Whitby and it’s absolutely gorgeous you know it’s it’s been likened to the royal crescent in bath and there’s there’s such a breathtaking view of the sea from there so it’s completely unobstructed and most of these holiday apartments have already been sold.

We’ve got two left only two so what I’m going to do is put a link in the description for those for those of you that are following me that if you want to buy one of these last two you can go ahead and do that.

So get one before before they’re gone.

So let me let me introduce Andrew Bartlett here – Se’s a property developer.

Hi Andrew

Hello George. How are you doing today?

Very well thank you very much

Yourself?

Very good, awesome, awesome.

So just wondering you know for those people this is the second video and I’ll include a link in the description for that.

But for those people who don’t know what this is can you just give us a brief overview of what is the property and what is the conversion

Yeah so it’s what was previously a 27 ensuite bedroom hotel being converted into 15 apartments. That’s 12 two bed apartments and three one bed apartment.

And they’re set in the Royal Crescent as you say in Whitby overlooking the sea and done to a very
decent standard to say the least.

Yeah yeah decent he’s being modest, he’s been modest – to a very high standard, very high standard. And so the two apartments that are still available can you just tell us what what size they are so people know.

Yeah so there are two one beds left we’ve sold one of the one beds but there are just two of the the one beds left

I think they range from about £205k.

Okay so you know click on the link and check with the agent.

So you know in terms of, let’s talk about the numbers. Because you know that’s a really important thing whenever you do any kind of property development, you must look at the numbers.

So just what are the top line numbers for this project?

Okay well I think the first thing to say George is that I always say you make your money when you buy it and that we bought this at a really decent price £695,000.

Plus obviously costs and some holding costs until we got the planning on top of that obviously we’ve got the development costs and all the costs including the development costs and the purchase costs come to about 2.8 million.

GDV about 4.2 million.

Yeah it’s a pretty decent the rest being sales costs and and profit and management fees.

So yes so that’s that’s roughly the numbers.

Yeah that’s good thank you and obviously you don’t know exactly how much it will be until you’ve finished.

Exactly, exactly and the GDV has actually gone up hasn’t it. Because we we filmed this seven months ago, the first one, and it’s increasing. The market’s moved on terrifically hasn’t it.

Yeah it was quite interesting I think at the time I put up two figures. One based on the bank’s valuation, and the banker got it just over £3.6 million. My view was that it was at just under four, £3.95m.

Yep but when we went to put them on the market, our view was it was £4.2m and actually I think we could have eeked out a little bit more and with that £4.2m we’ve also got some car parking spaces we’re selling at right it does come up a little bit above that.

Yeah good good. So you know as seven months have gone by since the first video what and I know there have been some challenges, and there are always challenges in the build so this is not unusual.

What could you can you tell us some of the challenges and how you’ve overcome them.

Yeah I suppose the the first challenge that we actually got was when Covid struck and this was before we’d even got planning so the planning committee could not meet and I’ll refer to the previous video about that rather than going about that now because you’ve got the planning meeting actually
on your links.

Yep, so that was the first thing. I think also it’s made us very conscious of not overcrowding the site, having to ventilate the site, and things like that with with Covid. It’s that’s the challenge we’ve had to look at.

I think other things when it comes to suppliers there’s been some delays and getting some supplies. But not actually, it hasn’t really impacted us too much to be fair.

I’ve heard other people be impacted, but on the whole for us it’s not been a big issue. The biggest issue for us was that our contractor got into I suppose, financial trouble and have gone into administration.

So that is a big a big thing for us, so then we had to decide what we we needed to do.

I suppose four basic choices:

– Choice one we give up and we say oh this is too difficult – to give away the profit. So yeah,
that was not a choice.

– Choice number two that was really all about appointing another contractor. Now any decent contractor at the moment have got full order books. So to get a new contractor on board at the very least would have taken another six months, or something longer. So the longer you leave things, the greater risk there is.

So for example, might be risk to our sales. Sisk of things going up in price and cost. So you know for us that was not an option.

– I suppose option number three was use a related contract to the original one or a phoenix contractor, because you know we know that you know sometimes things happen outside of contractors or business control and they then I suppose metamorphosis into something else, or they
arise from the ashes. Yeah, that wasn’t an option, because you know it could be that we could have been in the same place a little time later.

So yeah for us the only option was become a contractor DIY, do it yourself form our own contracting company, which we haven’t done before.

So that gave us some challenges yeah in itself. So that’s what we’ve done. And those challenges then are then all about really finance and how you finance the job. But even before that where’d you get a workforce? And how did you manage that workforce?

Going on from there you’ve then got…what’s your ordering going to be like? Who’s going to order what? What’s your critical path?

So it was like basically doing everything the contractor was going to do and and organised that. And you know if you just think of a timeline of ordering a kitchen you think I’ll just order a kitchen. Well we’ve got three main elements to our kitchens:
– it’s the kitchens are ordered from predominantly Wren. Then sorry, other kitchen providers are available.

-We then got the the worktops themselves, the quartz worktops

– And then we’ve got the glass splashbacks

Now if you think we almost work backwards from when we need to order it. Or sorry when we want
the the kitchen finished.

The next thing we have to look at is when do the glass people need to measure? The glass people can only measure, let alone fit once the stone’s in.

The stone people can only measure once the the kitchen’s fitted.

So you have to sort of work back and all these things are interrelated, so you get a three week span or four week span, I suppose from order delivery of the kitchen, templating of the quartz, delivery of the quartz, templating of the glass, delivery of the glass and fitting the glass.

So we’ve had to sort of re-engineer the whole numbers ourselves. So that’s been quite a challenge.

Suppliers working with suppliers. Obviously some were left potentially with some money outstanding. So we had closely with the local suppliers, to see how we could work with them.

Luckily on the whole they’ve been very supportive and that’s helped. But cash flow is a real challenge
because your contractor normally supplies you with credit. So what happens is they do the work.
They rely on their creditors. So they’ve got you know, the suppliers:
– kitchen suppliers

– electrical suppliers

You know all the suppliers in their supply chain give them credit. They almost pass that on to you.

Yeah valuation from the bank’s QS. The bank. You pay the contract and the contractor dishes it out
among the suppliers yeah. So that that in its peak time for us added up to over £300,000. That was an additional requirement. And the bank was supportive – they’ve given us a bit more money. We put some more money in ourselves and we’ve got a bit of credit from the suppliers ourselves.

So we’ve managed to do that. But you know these weren’t sort of five-minute you know ,wave of magic wand that happens. We have to put a lot of time to get that sorted. Yeah I suppose those are the the main challenges.

And then you know costs have gone up. Yes over the last 12 months everybody goes around percentages, but you know anywhere from 15 to 25% for some some things. Other things have
stayed relatively stable. So it’s a bit of a mixed bag on there. Sut overall costs have gone up.

Yeah and you’re not the only one – only person to have had a contractor go out of business during Covid. Many other developers experiencing the same thing with different contractors.

Whatever walk of life you’re in, it doesn’t really matter. You face challenges, and how you deal with those challenges, that’s important.

Yeah, exactly. It’s all about pushing through, isn’t it.

Yeah, you know, I’m not saying it was easy, or it is easy, because because it isn’t. But I think, I always liking it to risk some people say I’m a bigger risk taker than than they, are you know. Or it’s all relative isn’t it. Because I think risk is all about mitigating risk, and for me if I feel mitigated that risk. I feel the
risk is lower but for other people they would consider that risk to be higher for them.

Yes, the same with the same with all these things. You know so just how you face the challenges, I think, definitely.

So, looking then at what is finished – some of it is finished already. Can you tell us what’s what’s been done so far.

So I mean because of delays to the planning that meant that we couldn’t complete the stair core and the lift core that we’ve built outside of the rear early enough. Because we couldn’t do the enabling works outside because we haven’t got planning permission to do it, so that’s held up that whole raft of work.

Yeah, so that’s meant that we’ve had had to compromise.

We’ve got a scaffolding ladder if you like going up and down outside the building. But we’ve put a new
roof on. We’ve got new dormers all the windows are in the front except for the lower ground floor.

All the windows are in the rear except for the lower ground floor. We’ve started painting on the front.
So the decoration on the front is now started.

So very shortly the scaffolding will start to come down internally.

I suppose the the biggest change – we’ve split it up, it was two hotels before that became one and we’ve worked primarily on the…if you’re looking at the front of the building the right hand side, number 14, the left-hand side number 13 has been a little bit behind that.

But what we’ve now got is the two bedders down the right-hand side, where we’ve got a show apartment – that one’s finished.

Number three is finished and that’s they’re in situ or all done and dusted.

And then the three above that are there abouts finished, they’ve just got a few finishing touches to go on, but they’re well on the way to completion. Perhaps a little bit of work to do in a couple of the bedrooms.

Where we’ve had some challenges, with you know making sure the walls exactly in the right place for the stairs and things like that. And where we’ve got to push through into the new stair core. So there are a few issues that are waiting for the staircore.

But we’ve now got stairs on site. It’s taking a long time, but we’ve got stairs on site. So they’ll be going in starting next week. We’ve had them delivered over the last week and a half and enabling works
going on at the bottom of that. And then the stairs will start going up next week.

Yeah, so know you’re talking about you know, difficulties with the suppliers. So joiners are in a bit of a
shortage at the moment.

Oh absolutely. You know, if anybody’s watching this over there. I don’t know when this is going out, but probably in a weeks time, but if you’re a joiner and you’re really good joinery not want to go to Whitby for a few weeks, contact me. Yeah it’s a nice place for holiday. Accommodation can be supplied if you’re traveling.

Excellent, excellent, thank you.

So thanks for giving all our viewers an update on the on the project.

I’ll put a link in the in the Show Notes for the previous video, so people can watch it from the beginning – you know when we started off the Carlill.

But if anyone wants to follow up with you Andrew, what’s the best way for them to do that?

Oh via Facebook and I know you’ll put a link in there.

I’ll put it in the show notes, yeah. No problem all. Right well thanks Andrew for coming on the show. Thanks for giving us the update.

And to everyone else, thanks for watching and we’ll see you all next week.

Bye. Cheers George

 

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Commercial Conversion — The Carlill, Whitby | Update #2 | Sarah & George Choy Property Podcast
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Commercial Conversion — The Carlill, Whitby | Update #2 | Sarah & George Choy Property Podcast
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Commercial Conversion of The Carlill in Whitby to 15 Holiday Apartments — one of the property developments I'm involved in. Video update #2 with Property Developer - Andrew Bartlett.
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