Twenty-three housing cooperatives linked to collapsed Finnish housing developer Lakea have been declared bankrupt by the Ostrobothnia District Court.
The ruling was handed down on Tuesday 4 November. Touko Raitis, a court-appointed administrator, confirmed he had been assigned to oversee the bankrupt estates.
The affected companies had been under liquidation since August, when parent company Lakea oy filed for bankruptcy.
The company had previously sought corporate restructuring in May, but cancelled its application after creditors filed their own bankruptcy motions.
Among the petitioners were Kuntarahoitus and Handelsbanken, which together sought the bankruptcy of all 23 companies. The only exception is Turun Nuutinkulma, which was not included in the court’s decision. The reason for its exclusion remains unclear.
The decision affects a nationwide portfolio of properties operating under Lakea’s so-called Omaksi model. Under this system, residents paid both an upfront fee and monthly charges, with the promise of gradually acquiring full ownership of their flats over 20 years.
All 24 Omaksi-model companies were rendered insolvent after the collapse of Lakea. Only one has so far avoided formal bankruptcy proceedings.
Residents now face serious financial consequences. Over 200 households are estimated to have invested in Omaksi-model homes, with combined claims exceeding €10 million. Most stand to lose both their homes and their capital.
The companies placed into bankruptcy are located across Finland, including Espoo, Jyväskylä, Kuopio, Riihimäki, Seinäjoki, Turku, Vaasa, Vantaa and Oulu. Notable entries include the three Puukuokka buildings in Jyväskylä and four Lakea developments in Kuopio.
Lakea’s largest shareholder is the city of Seinäjoki, which holds a stake of approximately 21.7 percent. Other shareholders include several local authorities and public institutions.
As the financial crisis unfolded earlier this year, affected residents formed an association to coordinate their response. They have also filed a criminal complaint on behalf of 235 individuals.
The National Bureau of Investigation is now examining allegations of misconduct. Charges under review include breach of contract, misleading marketing and misuse of company funds.
Lakea’s former chief executive Timo Mantila resigned shortly after the company applied for restructuring in May.
The bankruptcy administrator is expected to begin assessing the companies’ assets and liabilities. In most cases, the properties are likely to be sold in an attempt to cover outstanding debts.
HT
