LKP trustee Liam Spender, a leaseholder and solicitor, was in the property tribunal this morning thrashing out the terms of his c£500,000 service charge challenge against his ARC TIME Freehold Income Fund freehold owner and FirstPort at St David’s Square, on the Isle of Dogs, east London.
The hearing under Judge Pittaway saw Mr Spender arguing for prior view of detailed accounts from FirstPort, which were resisted by barrister Aaron Walder and instructing solicitor Camilla Waszek, for Liverpool debt-collecting firm JB Leitch.
Members of the public in attendance included LKP director Sebastian O’Kelly, LKP chair Martin Boyd, MailOnline writer Myra Butterworth and Lucy Brown, a fellow leaseholder at St David’s Square and one of the three, with Mr Spender and Dean Buckner, who articulated the LKP sector-wide levy proposal on developers and cladding manufacturers to pay up for the cladding disaster. Also present was barrister Caoimhe McKearney.
Whatever hopes FirstPort may have had that this was going to be a minor leaseholder rebellion would have been dispelled this morning. The full arguments of the case will be heard after April next year.
St David’s Square, which was build by the prime London developer the Berkeley Group, was the subject of a MailOnline news report two days ago by Ms Butterworth that leaseholders were furious at a £450,000 new intercom system, of which £34,000 will be FirstPort’s management fee.
Leaseholders told they will pay more than £450,000 for new intercom system The charge includes a fee of at least £34k to the property management company Countryside Communications has billed £700k in rental fees for existing system Leaseholders at a block of flats in East London have been told they will pay at least £450,000 for a new intercom system – and the cost doesn’t even include any new cables.
Mr Spender, whose share of the bill would be £1,138.50, was quoted:
“I’m worried because we have cladding issues here as well, another mess Berkeley Group left us to clean up. If FirstPort is milking us over a relatively small project, I dread to think what it will be like when they are in charge of potentially millions of pounds of cladding remediation spending.”
In an arrangement all too typical of our housebuilders, the Berkeley Group signed a long-term rental agreement with Countryside Communications to provide the intercom system.
Update: Apparently vampiric FirstPort is allergic to Daily Mail coverage (also known as sunlight). They’ve now turned a section 20 consultation on the intercom into an open ballot. I wonder if we’ll get the same ballot options for cladding? @MyraButterworth https://t.co/ZAnFQGLULT— Liam Spender (@LiamSpender) November 24, 2021
The contract should have expired in July last year, but was allowed to roll over.
Countryside billed £282,935.11 in rental fees in 2019 and 2020, and between 2016 and 2020, it has billed more than £700,000 in rental fees for the existing system, MailOnline reported.
The 2020 rental price works out at roughly £325 per flat per year.
The replacement system is believed to cost about £46 per flat per year, and so residents will eventually save money with the new system – although it will take 18 months of those savings to pay off FirstPort’s fees and Countryside’s exit charge, MailOnline noted.
It also pointed out that no new wiring appeared to be required at the site.
FirstPort was quoted:
“In our role as property manager, we are supporting homeowners and residents to get this upgrade completed whilst ensuring the costs of these works, and disruption to residents, are kept to a minimum.
“We do charge a fee as part of the major works process to cover our time managing the Section 20 consultation and the procurement process, which includes running a tender process and obtaining competitive quotes from qualified suppliers for the work, as well as coordinating the subsequent works on-site and communicating with our customers throughout.’
FirstPort is the biggest block manager in the country with c200,000 flats under management, and owes its origins to the retirement housing sector, where it is still the biggest managing agent.
Formerly Peverel, it was owned by Tchenguiz Family Trust until it was pitched into administration following the arrest by the Serious Fraud Office, on wrong evidence, of Vincent and Robert Tchenguiz, in February 2011. Vincent Tchenguiz employed the company at his freeholds, at one time thought to amount to 1% of all residential freeholds in the country.
In December 2013 the now defunct Office of Fair Trading ruled that Peverel’s electronic intercom and door entry subsidiary Cirrus had operated a bid-rigging racket cheating pensioners with £1.4 million contracts at 65 retirement sites.
Peverel paid out £100,000 as a “gesture of goodwill” and rebranded itself as FirstPort.
No one in the company was punished.