• Menu
  • Skip to primary navigation
  • Skip to main content
  • Skip to primary sidebar
  • Skip to footer

Before Header

  • Home
  • What is LKP
  • Find everything …
  • Contact
Donate

Leasehold Knowledge Management Logo

Secretariat of the All Party Parliamentary Group on leasehold reform

Mobile Menu

  • Home
  • What is LKP
  • Find everything …
  • Contact
  • Advice
  • News
    • Find everything …
    • About Peverel group
    • APPG
    • ARMA
    • Bellway
    • Benjamin Mire
    • Brixton Hill Court
    • Canary Riverside
    • Charter Quay
    • Chelsea Bridge Wharf
    • Cladding scandal
    • Competition and Markets Authority / OFT
    • Commonhold
    • Communities Select Committee
    • Conveyancing Association
    • Countrywide
    • MHCLG
    • E&J Capital Partners
    • Exit fees
    • FirstPort
    • Fleecehold
    • Forfeiture
    • FPRA
    • Gleeson Homes
    • Ground rent scandal
    • Hanover
    • House managers flat
    • House of Lords
    • Housing associations
    • Informal lease extension
    • Insurance
    • IRPM
    • JB Leitch
    • Jim Fitzpatrick MP
    • John Christodoulou
    • Justin Bates
    • Justin Madders MP
    • Law Commission
    • LEASE
    • Liam Spender
    • Local authority leasehold
    • London Assembly
    • Louie Burns
    • Martin Paine
    • McCarthy and Stone
    • Moskovitz / Gurvits
    • Mulberry Mews
    • National Leasehold Campaign
    • Oakland Court
    • Park Homes
    • Parliament
    • Persimmon
    • Peverel
    • Philip Rainey QC
    • Plantation Wharf
    • Press
    • Property tribunal
    • Prostitutes
    • Quadrangle House
    • Redrow
    • Retirement
    • Richard Davidoff
    • RICS
    • Right To Manage Federation
    • Roger Southam
    • Rooftop development
    • RTM
    • Sean Powell
    • SFO
    • Shared ownership
    • Sinclair Gardens Investments
    • Sir Ed Davey
    • Sir Peter Bottomley
    • St George’s Wharf
    • Subletting
    • Taylor Wimpey
    • Tchenguiz
    • Warwick Estates
    • West India Quay
    • William Waldorf Astor
    • Windrush Court
  • Parliament
  • Accreditation
  • [Custom]
Menu
  • Advice
  • News
      • Find everything …
      • About Peverel group
      • APPG
      • ARMA
      • Bellway
      • Benjamin Mire
      • Brixton Hill Court
      • Canary Riverside
      • Charter Quay
      • Chelsea Bridge Wharf
      • Cladding scandal
      • Competition and Markets Authority / OFT
      • Commonhold
      • Communities Select Committee
      • Conveyancing Association
      • Countrywide
      • MHCLG
      • E&J Capital Partners
      • Exit fees
      • FirstPort
      • Fleecehold
      • Forfeiture
      • FPRA
      • Gleeson Homes
      • Ground rent scandal
      • Hanover
      • House managers flat
      • House of Lords
      • Housing associations
      • Informal lease extension
      • Insurance
      • IRPM
      • JB Leitch
      • Jim Fitzpatrick MP
      • John Christodoulou
      • Justin Bates
      • Justin Madders MP
      • Law Commission
      • LEASE
      • Liam Spender
      • Local authority leasehold
      • London Assembly
      • Louie Burns
      • Martin Paine
      • McCarthy and Stone
      • Moskovitz / Gurvits
      • Mulberry Mews
      • National Leasehold Campaign
      • Oakland Court
      • Park Homes
      • Parliament
      • Persimmon
      • Peverel
      • Philip Rainey QC
      • Plantation Wharf
      • Press
      • Property tribunal
      • Prostitutes
      • Quadrangle House
      • Redrow
      • Retirement
      • Richard Davidoff
      • RICS
      • Right To Manage Federation
      • Roger Southam
      • Rooftop development
      • RTM
      • Sean Powell
      • SFO
      • Shared ownership
      • Sinclair Gardens Investments
      • Sir Ed Davey
      • Sir Peter Bottomley
      • St George’s Wharf
      • Subletting
      • Taylor Wimpey
      • Tchenguiz
      • Warwick Estates
      • West India Quay
      • William Waldorf Astor
      • Windrush Court
  • Parliament
  • Accreditation
You are here: Home / News / Ending ground rents will hurt leaseholders, says Long Harbour …

Ending ground rents will hurt leaseholders, says Long Harbour …

July 16, 2019 //  by Sebastian O'Kelly

 … which won’t say who owns freeholds it manages 

The Communities Select Committee: Richard Silva, of Long Harbour / HomeGround / Adriatic Land / Abacus Land etc …
“absolutely agree with the Government’s direction of travel in banning leasehold houses going forward. We completely agree with the elimination of onerous ground rents.” Shame then that Long Harbour’s portfolio has both leasehold houses and lucrative – ie onerous – ground rents: 4,165 onerous leases where the ground rent doubles at 10 or 15 years. And 1,807 Taylor Wimpey doubling ground rents

A last gasp effort to save ground rents was made by Long Harbour executive director Richard Silva in the recent issue of News on the Block.

The scandal of onerous ground rents has been driving the call for reform while “only affecting a small fraction of the UK’s four million leaseholders”.

Government’s decision on zero ground rents will end up hurting leaseholders and the property market as a whole

The leasehold system has come under an intense spotlight over the past two years with a clear consensus emerging that measured reforms are required to bring the regulations around the tenure into the 21st Century.

Even the ever-compliant Leasehold Advisory Service says 57% of leaseholders regret their decision to buy this form of property tenure.

Mr Silva calls for “robust regulation”, like the freeholders’ Pledge and code of practice – a lobbyists’ damp squib unveiled earlier in the year but given a sort-of welcome by James Brokenshire (who then decided new ground rents should be zero).

And Mr Silva is not happy about Clive Betts MP’s excellent Housing, Communities and Local Government Select Committee.

“We contributed both Written and Oral Evidence to the Committee and sadly, our experience and knowledge of this sector has not been properly heeded in the Government’s decision-making process.”

There have been some piss-takes too far, sorry: “well-thought-out proposals, including the banning of new-build leasehold houses, which we and other industry stakeholders have long supported.”

Remind me, just how long has Long Harbour been opposed to leasehold houses?

Presumably a bit after it hoovered up loads of these juicy and absurd freeholds, currently causing misery to thousands of ordinary home owners.

Worth a reminder, too, that Long Harbour demanded as much as it possibly could when victims sought to buy their freeholds, such as here:

Adriatic Land now wants £54,000 for my freehold that Taylor Wimpey said would cost £6,000

Ground rents are right and proper, says Mr Silva, as the payola for investments in people’s homes which ensure that professional long-term custodians run the place. Or in his words:

“The Government believes that all costs associated with the management and supervision of a property, i.e. the obligations in a lease on a freeholder to serve as a responsible steward, can be wrapped up in the service charge instead. Unfortunately, this approach is incompatible with the needs of the institutional investors, predominantly pension funds, who support the current market.”

Actually, wads of Long Harbour’s freeholds are owned offshore by private equity interest and may include Hutchison Whampoa, of Hong Kong. But they are not saying, and all beneficial owners are hidden behind nominee directors.

“The alternative to this will be resident-led management groups. Professional freeholders are well resourced and provide important oversight roles in estate management, health and safety and fire risk management …”

Well, oversight, possibly, but certainly no cash.

Communities Secretaries Sajid Javid and James Brokenshire pleaded with freeholders, including Long Harbour, to pay up to remove Grenfell cladding from their buildings.

None of the ground rent speculators ever did so, although some developers have, such as Barratt.

“Removing these freeholders will remove these important functions, as resident-led groups will be not be adequately qualified or resourced to undertake them. Consequently, the banning of ground rents not only removes professional freeholders, but will essentially invite increased risk, liability and costs for leaseholders.

“Surely the payment of a reasonable ground rent in return for these valuable services, under a properly regulated regime, is a far better, safer and cheaper outcome for consumers?”

What about ground rents where no “valuable services”.

What price would Mr Silva place on the services of Martin Paine, say, or Benjamin Mire, or Israel Moskovitz / Joe Gurvits?

Here’s the example of Mr Paine:

Martin Paine ‘is a crook who is turning sleaze in leases into an art form’, MPs told

“With the government’s proposal to wrap all costs into the service charge, there is also the potential that large fees could be channelled through this charge on an individual block-by-block basis for the acceptance of the liabilities associated with stewardship. This, without the contractual certainty offered by the lease, will lead to vastly increased costs, possibly far greater than a fixed reasonable ground rent.

“These are crucial observations which could have been covered in an impact assessment by the Government before this decision was announced, but this has not been published and the efforts of industry parties to share data and case studies to aid in this process have been ignored.”

And more …

“Leaseholders have waited long enough and deserve much better than a sweeping reform which will inadvertently lower building stewardship standards by inviting less capable freeholders to the market, increase risk and costs when resident-led groups take charge, and which could result in far more onerous circumstances when service charges skyrocket while offering less protection for residents.

“We urge the Government to rethink their ruling on zero ground rents and to work with the industry to find the right solution.”

It is hugely to the credit of politicians and officials that they saw through all this nonsense, and that Mr Silva and his friends lost the argument on ground rents.

They and their offshore private equity friends need to find somewhere else to park their cash rather than in the income streams from ordinary families’ homes.

We have invited Mr Silva and Will Astor, of Long Harbour, to discuss these issues at the APPGs, but won’t.

Openness is not what they do, on the whole.

Related posts:

Tory MP Stephen McPartland shames Long Harbour / Adriatic Land into dropping doubling ground rent leases Political arms race commences as Labour announces £250 ground rents for existing leaseholders Kate Osamor MP asks parliamentary questions for Long Harbour on ground rents, says Daily Telegraph Why are National Trust leaseholders in uproar over ‘modern ground rents’? Ground Rents Income Fund plc offers help to leaseholders … in order to keep this grisly show on the road

Category: Latest News, News, Press, William Waldorf AstorTag: Long Harbour, News on the Block, Richard Silva

Latest Tweets

Tweets by @LKPleasehold

Mentions

Anthony Essien (34) APPG (37) ARMA (87) Bellway (30) Benjamin Mire (32) Cladding scandal (71) Clive Betts MP (31) CMA (45) Commonhold (52) Competition and Markets Authority (41) Countryside Properties plc (33) FirstPort (42) Grenfell cladding (56) Ground rents (54) Harry Scoffin (150) James Brokenshire MP (31) Jim Fitzpatrick (35) Jim Fitzpatrick MP (30) Justin Bates (40) Justin Madders MP (67) Katie Kendrick (37) Law Commission (60) LEASE (66) Leasehold Advisory Service (62) Leasehold houses (32) Long Harbour (48) Martin Boyd (80) McCarthy and Stone (39) National Leasehold Campaign (38) Persimmon (49) Peverel (61) Property tribunal (49) Redrow (30) Retirement (37) Robert Jenrick (33) Roger Southam (47) Sajid Javid (38) Sebastian O’Kelly (55) Sir Peter Bottomley (201) Taylor Wimpey (106) Tchenguiz (33) The Guardian (33) The Times (31) Vincent Tchenguiz (43) Waking watch contracts (40)
Previous Post: « ONS trumpets collapse in sales of new-build leasehold houses
Next Post: Number 10 chief of staff Gavin Barwell ‘delighted’ to be invited to present award to LKP Leasehold Knowledge Partnership Parliamentary award»

Reader Interactions

Comments

  1. Michael Epstein

    July 17, 2019 at 6:48 pm

    In the absence of a response from Richard Silva from Long Harbour I would like to publish part of the Long Harbour prospectus for investors.
    For those that may be unaware, Mr Silva honed his freehold investment skills working for Vincent Tchenguiz at Consensus Group,a group whose structure was once famously described as “Being of biblical complexity”
    We identify real estate assets that have key characteristics such as strong covenants, sustainable locations and highly diverse tenant base.
    These elements contribute to providing our limited partners with long term and stable cash flows,inflation correlation and low obsolescence risk.
    The stable high quality cash flow from ground rents has attracted pension fund and other long term investors.
    Meanwhile, our management platform means that our ground rent business is completely transparent and investors receive an exact picture of the business they are investing in.
    So it is clear for all to see?
    “Strong covenants ” ie covenants that can be monetised. No point investing in a development where sub-letting or extensions are banned?
    If a leaseholder can’t sub-let or build an extension no fees can be earned by the freeholder or their investors?
    This then begs the question are leases being constructed in such a a way as to generate fees for the freeholder?
    Much mention is made of “cash flows” and business investments.
    I note despite the Long Harbour protestations that they are the “Long Term Custodians” of properties, not a single mention of any responsibility to the leaseholder?
    nothing about “fairness to the leaseholder” Nothing about maintaining the property. Nothing about making sure the property is safe to live in. Just look how the “investors” squealed when they thought they might be held responsible for the dangerous cladding? Not much “Custodianship” in those circumstances?
    Be it leasehold or common hold yes maintenance has to be carried out and paid for?
    Yes certain covenants are needed and again yes, whichever system be it leasehold or common hold a way to enforce will have to be in place.
    But what is not needed and never has been needed is for the homes that you and I buy to be treated as a business to generate cash flow for an investor?
    In times gone by, possibly there were more reasonable freeholders who were not exploitative(they still exist!) so the issue was not as urgent as it is now. Once the system was “gamed” that was it?
    No point in amending leasehold. That will be a sticking plaster over gangrene! It has to go. ownership has to be transferred to the leaseholders who have an over 90% investment in their property, otherwise companies such as Consensus and Long Harbour will find ever more ingenious ways of maintaining their cash flows?
    Going back to Richard Silva’s time at Consensus who would ever have believed that you could secure loans for freeholds over an astonishing 150 years? (remember the leaseholder can only usually obtain a mortgage over 25 years)
    Who would ever believe you could count not just ground rental income, but permission fees, late payment charges and sales packs as an asset over 150 years?
    There is no justification for our homes not to be our homes.
    There is no justification for our homes to be an investors cash flow?

  2. Tony Ward

    July 17, 2019 at 7:00 pm

    Expose leaseholders to more risk, liability and greater costs?

    Long Harbour did nothing on our estate to manage health and safety or fire risk management.

    They’re just trying to pull the wool over peoples eyes.

  3. Chris

    July 18, 2019 at 8:34 am

    Nothing but parasites

Above Footer

Advising leaseholders. Avoiding disasters.
Stopping forfeiture. Exposing abuses. Urging reform.

We depend on individuals for the majority of our funding.

Support Us and Donate

LKP Managing Agents

Become an LKP Managing Agent

Common Ground
Adam Church
Blocnet property management2

Stay in Touch

To achieve victory in the leasehold game where you are playing against professionals and with rules that they know all too well - stay informed with the LKP newsletter.
Sign Up for Newsletter

Professional Directory

The following advertisements are from firms that seek business from leaseholders.
Click on the logos for company profiles.

Footer

About LKP

  • What is LKP
  • Privacy and data

Categories

  • News
  • Cladding scandal
  • Commonhold
  • Law Commission
  • Fleecehold
  • Parliament
  • Press
  • APPG

Contact

Leasehold Knowledge Partnership
Open Data Institute
5th Floor
Kings Place
London N1 9AG

sok@leaseholdknowledge.com

Copyright © 2023 Leasehold Knowledge Partnership | All rights reserved
Leasehold Knowledge Partnership Limited (company number: 08999652) is a company limited by guarantee that is a registered charity (number: 1162584) with the Charities Commission.
LKP website is hosted at www.34sp.com
Website by Callia Web