Loss Making Pop Brixton owes creditors more than £1.2m

Details are beginning to emerge of the chaos Pop Brixton created which led to it going into administration last month.

Last week, administrators issued their proposals to Pop Brixton’s creditors, outlining the next steps.

It seems Pop Brixton bosses have pushed the admins a bit of a string. No mention is made of the fact that Pop Brixton had been losing money for nine years.

Instead, the trustees’ report claims all went well until Covid 19 struck, followed by the closure of Brixton Academy in December 2022.

Apparently later the rental income at Pop Brixton dropped from £300,000 a year to £150,000 a year.

Pop Brixton has not filed any company accounts since November 2022.

However, the administrators’ report gives us at least a hint of how much Pop Brixton has been losing over the past two years, culminating in a loss of £278,000 last year.

Administrators believe Pop Brixton’s assets (the shipping containers on site and some outstanding debtors) amount to just £85,000.

From this, an upfront administration fee of £67,000 and a secured loan of £25,000 must be paid. Which means the other 54 creditors will get absolutely nothing.

According to the administrators, the leases with the existing occupiers of the shipping containers have been awarded to the new operators of Pop Brixton.

Pop Brixton’s creditors are owed £1.2m. The big losers are HMRC, who are owed £471,000.

As well as not paying rent to Lambeth council for the land Pop Brixton is on, Pop Brixton also owes Lambeth council over £109,000 in business rates.

So not only have the council not made any money from Pop Brixton, they are actively losing it. Utilities and security companies also have unpaid bills that are close to £100,000 each.

Given Pop Brixton’s much-lauded efforts to market itself as a community-based company, it’s particularly galling to see the number of small, local businesses they’ve turned over.

Urban Growth, a community interest group that creates urban green spaces such as Brixton Orchard, is owed £10,800. There are more examples like this.

In 2020, Brixton Buzz reported that Pop Brixton had been awarded a £220,000 Arts Council grant, making the rather false claim that it was a cultural venue.

So it’s especially disturbing to see the number of companies and people in the entertainment industry that have been dismantled.

Victims include the Performing Rights Society, who are owed nearly £5,000, a record company, an event production company and two DJs who are owed £150 and £1,200 respectively.

While Pop Brixton will go to the wall, Lambeth council recently granted a new lease on the site to MS Bars (Brixton) Ltd. MS Bars are owned by Pop Community Ltd, who also own Pop Brixton.

It seems wrong that Pop Brixton can leave behind a trail of unpaid debts and the Pop community and Lambeth council simply carry on as if nothing has happened.

At the very least, Lambeth should have extracted more concessions from Pop Community before handing them another lease.

How about paying the £109,000 in business rates they owe Lambeth for a start?

But of course it all comes down to politics. Nobody on Lambeth council would let Pop Brixton off the hook completely.

After all the political capital that the New Labor group at City Hall has invested in this Third Way project, it is too embarrassing for them to admit that it has all gone pear-shaped.