Company Number: OC448100

Analysis Date: 2025-07-29 18:46 UTC

1. Risk Rating: MEDIUM

Justification: KRTSR PROPERTIES LLP is a newly incorporated property-focused LLP with significant fixed assets (£3.39M) and a net asset position (£2.93M) as at 31 March 2024. However, the company has a relatively high level of liabilities due after more than one year (£464k bank loan) and a substantial loan due to members (£2.91M) classified as a liability. The net current assets are zero, indicating no working capital buffer. The absence of employees and limited operational history also contribute to uncertainty regarding operational sustainability.

2. Key Concerns:

• Concentration of Member Loans: The members’ loans represent almost the entire equity and are classified as liabilities, indicating a reliance on member financing that may affect financial flexibility and creditor seniority.
• Lack of Working Capital: Net current assets are reported as zero, pointing to potential liquidity constraints for meeting short-term obligations or operational expenses.
• Limited Operational History: Incorporated in July 2023 with accounts covering less than one year, there is insufficient financial track record to assess business performance or stability.

3. Positive Indicators:

• Strong Fixed Asset Base: The LLP holds tangible fixed assets (land and buildings) valued at £3.39M, suggesting a solid asset foundation underpinning the business.
• No Filing or Compliance Issues: Accounts and confirmation statements are filed on time with no overdue filings, indicating regulatory compliance.
• Clear Control Structure: Two designated members with defined voting and appointment rights provide transparent governance.

4. Due Diligence Notes:

• Investigate the nature and terms of the loans due to members, including repayment schedules and security arrangements.
• Assess the valuation methodology and marketability of the tangible fixed assets to verify asset quality.
• Review any cash flow forecasts or business plans to understand how the LLP intends to generate operational income and meet liabilities.
• Confirm whether any profit and loss accounts or management accounts exist to supplement the financial picture.
• Evaluate the relationship and creditworthiness of the LLP’s bank lending institution given the outstanding loan.