A GROWING number of commercial properties in Yorkshire which have gone into administration or receivership are set to come on to the market this year if economic growth continues, says property consultants King Sturge.

The financial crisis which triggered the recession has led banks to take a longer view over the future of commercial properties where loan repayments have defaulted and not immediately put them in receivership, according to King Sturge’s Northern Property Receivership Team.

But this may be about to change.

Simon Cullimore, the firm’s fixed-charge property receiver, said banks recognised their part in the property market crash.

This, and the fact that quick sales to recover funds had been impossible because of the credit crunch, had led banks to restructure bad debts rather than recover them.

It was in contrast with the aftermath of previous property market crashes where banks placed “bad debt” properties in receivership quickly to take control of assets and recover as much as they could as fast as possible.

Mr Cullimore said: “Last year’s economic recovery was stronger than many forecast and, if the last quarter’s GDP contraction turns out to be a blip as many economists expect, lenders may be able to crystallise commercial losses this spring and sales which have so far not been part of their strategy may come to fruition.

“Many commercial law firms and accountancy practices built up recovery teams expecting this to be a growth area, but have not been as busy as anticipated because the banks have been relatively unconcerned about acting immediately to recover losses.”

A key reason for this was that the banks accepted some responsibility, but also because the Scottish banks were now effectively in public ownership and could not be seen to pull the plug on the enterprise culture.

But, said Mr Cullimore, if economic recovery continued, banks may decide the time was right to deal with bad debts and put properties on to the market.

“There is an expectation that, as the market settles down and potentially strengthens during the next 12 months, more properties will be placed in receivership because the debt position will be crystallised and a combination of value properties and economic recovery will bring more buyers into the market.”