Opal Properties, which owes 14 lenders more than £880m, has been desperately trying to refinance for several months.

But today it lost the battle when its banks called in Ernst & Young to take control of more than a dozen Opal businesses that own 20 properties around the country.

A remaining 54 Opal companies, which own nearly 30 properties between them, have not been affected.

The move is a blow to Ocon Construction creditors. It is understood Opal had been taking loans from Ocon for some time to help finance its heavy debts.

Ocon’s administrator Tim Askham, partner at Mazars, had hoped to recoup cash paid to Opal in the form of loans. The last loan booked in the accounts was for £4m and another is understood to have been taken out since then.

The collapse of Opal Properties means banks will be first in the queue for any assets leaving precious little for Ocon Construction creditors.

Opal was founded by entrepreneur Stuart Wall in the 1980s. It is one of the largest student accommodation providers in the country with more than 20,000 beds. Wall formed Ocon to deliver his student accommodation portfolio.

E&Y said in a statement the properties provide student accommodation and professional lets for 7,200 tenants in nine locations throughout the UK – Bradford, Dundee, Huddersfield, Leeds, Leicester, Liverpool, London, Manchester and Wolverhampton.