38 THREADNEEDLE STREET LIMITED

Executive Summary

38 Threadneedle Street Limited is a recently incorporated property holding company with significant long-term liabilities closely matching its investment property assets, resulting in minimal equity and potential solvency concerns. While regulatory compliance is sound and asset valuations appear appropriate, liquidity and operational sustainability are uncertain absent clear revenue generation. Further due diligence on financing terms and lease income is essential to assess investment risk adequately.

38 THREADNEEDLE STREET LIMITED - Analysis Report

Company Number: 14469577

Analysis Date: 2025-07-29 20:42 UTC

1. Risk Rating: HIGH
   Justification: The company shows a significant imbalance between current liabilities (£35.54m) and current assets (£1.47m), with extremely low net assets (£82,934), indicating potential solvency and liquidity concerns.

2. Key Concerns:

• Solvency Risk: Total liabilities due after one year (£35.54m) nearly match the value of investment property assets (£35.27m), with negligible equity buffer and minimal net assets, raising questions about the company’s ability to meet long-term obligations.
• Liquidity Concerns: Current liabilities (£1.12m) substantially exceed current assets (£1.47m), but current liabilities falling due within one year are relatively low compared to the total non-current creditors, yet tight liquidity remains a concern given the small cash reserves relative to total liabilities.
• Operational Stability: The company is newly incorporated (Nov 2022), with no employees and no turnover disclosed. The financial statements show a single property acquisition but no operational income or evidence of sustainable business activities beyond property holding.

3. Positive Indicators:

• The company has complied with all filing deadlines and is not overdue on accounts or returns, indicating good regulatory compliance.
• Investment property is valued at fair value, which aligns with acquisition cost and suggests no immediate impairment.
• Directors appear experienced and stable, with no red flags regarding disqualifications or changes in governance.

4. Due Diligence Notes:

• Investigate the nature and terms of the £35.54m creditor balance falling due after more than one year, including covenant terms, repayment schedules, and counterparty risk.
• Review rental income contracts and lease terms underpinning the £7.44m minimum lease payments to assess revenue stability and cash flow projections.
• Assess source of funds used for property acquisition and ongoing financing arrangements to understand leverage and funding risks.
• Confirm absence of contingent liabilities or off-balance sheet exposures given the high leverage.
• Monitor future accounts for evidence of operational income, expense management, and profitability trends.