BAILGATE PROPERTIES LIMITED

Executive Summary

Bailgate Properties Limited, a recently incorporated property letting company, shows signs of significant financial distress with negative net assets and a weak liquidity position. While the company holds investment property and maintains up-to-date compliance filings, the heavy debt burden and insufficient current assets pose a high risk to solvency and operational stability. Further due diligence on debt terms and asset valuations is essential to evaluate the company's viability.

BAILGATE PROPERTIES LIMITED - Analysis Report

Company Number: 14738566

Analysis Date: 2025-07-29 13:05 UTC

1. Risk Rating: HIGH
   The company exhibits a high solvency and liquidity risk primarily due to a negative net asset position and substantial long-term liabilities that exceed its current assets and equity.

2. Key Concerns:

• Negative Net Assets: The company reports net liabilities of £19,060, indicating that total liabilities exceed total assets, which is a critical solvency red flag.
• High Long-Term Borrowings: Creditors due after more than one year stand at £481,538 against investment property assets of £480,094, suggesting heavy reliance on debt financing that could impair financial flexibility.
• Poor Liquidity Position: Current liabilities of £18,542 exceed current assets (cash of only £926), resulting in negative net current assets of £17,616, raising concerns about the company’s ability to meet short-term obligations.

3. Positive Indicators:

• Investment Property Asset: The company holds investment property valued at £480,094, which is its principal asset and may provide a future source of income or collateral.
• Compliance: The company is up to date with its filing obligations, including accounts and confirmation statements, demonstrating regulatory compliance and governance discipline.
• Single Shareholder Control: With a single director and 100% shareholder control by Helen Margaret Cope, decision-making may be streamlined, potentially allowing for quick response to financial or operational challenges.

4. Due Diligence Notes:

• Verify the nature and terms of the long-term liabilities (£481,538), including interest rates, repayment schedules, and any covenants that may impact financial stability.
• Assess the fair value and marketability of the investment property to determine if the carrying amount reflects realizable value, especially in a stressed scenario.
• Investigate cash flow forecasts or management plans addressing the negative working capital and net liabilities to understand going concern assumptions and recovery strategies.
• Review director background and financial support capacity given the company’s early stage and financial position.
• Confirm no contingent liabilities or pending legal issues that could exacerbate financial risks.