24.01.2012 Why does Anthony Essien, of LEASE the Leasehold Advisory Service, think “mediation” is the way forward in leasehold reform – when his own organisation scrapped its mediation service exactly a year ago? Read news for more …

23.01.2012 Will Boris Johnson support leasehold reform and defy government? Read Sebastian O’Kelly’s report on the Greater London Assembly meeting on leasehold reform on the NEWS page.

21.01.12  Visit our new Leasehold Knowledge Facebook page to view our recently loaded videos – http://www.facebook.com/LeaseholdKnowledge.

20.01.12 NEW APPOINTMENT ANNOUNCEMENTS

ARMA – the appointment of the new Chief Executive, Michelle Banks,  (current employment – Deputy Director, Development Management (Planning), equivalent to the previous Grade 6 or 7 civil servant in the DCLG), has been announced. It was recently announced that Peter Hinchliffe would take up the new role of Head of Peverel’s Governance and Regulation Group. He was the former Lead Ombudsman of the Financial Ombudsman Service.

Ex Peverel Legal Eagle moves to Anchor

We have also just been informed that David Edwards, former Head of Legal Services at Peverel til July 2011, immediately become the Director of Compliance and Company Secretary at Anchor. Readers will remember that the former CEO of Anchor, John Belcher was historically the highest paid CEO in UK Social Housing Associations on a salary of £391K per annum. Jane Ashcroft is the current CEO of Anchor. Anchor is England’s largest not-for-profit housing association, providing housing, care and support to people over 55 years old. Registered as a charity, it is one of the largest in the UK, with a turnover of £286.5 million in 2009/10.

Peter Bottomley MP, joins the Campaign against Residential Leasehold Exploitation Campaign

and has been in touch with us about a development in West Sussex who have won their case re overcharging at the LVT, and then won their appeal, and yet Peverel are re-appealing. Some people never learn! Details of this case will hopefully be publicised to a wider audience soon.We are also in touch with DCLG about this case

Job Description for the new Chief Executive’s role at ARMA

This is a very telling excerpt from the job description of the new Chief Executive recently recruited to replace the retiring David Hewett.   We will be looking closely at ARMA’s ability to impose discipline now that a new CE is taking up her post, having left DCLG.  On the basis that there is no legislation in place, and the various codes of practice are  unenforceable, how is this discipline going to be effected and effective?  Firing managing agents for losing many LVT’s damages ARMA’s revenue stream  – are they really going to do that?  We continue to doubt it, but will be looking out for any indication that their processes will become more robust in the future.  With less than 10% of the total number of managing agents signed up to this  organisation, what does this say about the remaining 90%? Why are they not convinced that paying the hefty fee to gain the ARMA logo and an electronic newsletter makes economic and business sense?

“ARMA’s Council is currently working on a five year plan and will expect the appointee to implement this subject to his or her input. The plan has the following stated objectives:

to maintain ARMA as “Fit for Purpose” so that its members may demonstrate Honesty, Competence and Professionalism;

to provide a competent Secretariat at suitable office premises with appropriate succession planning;

to maintain a sound financial base for the organisation;

to maintain a suitable Committee structure to control and promote the activities of ARMA

to provide suitable professional guidance to Members and the Public in the form of Guidance Notes and technical advice;

to ensure the continuance of the Annual Conference;

to maintain appropriate contact with other professional organisations including the IRPM

and to proactively increase membership of ARMA at all levels.

The expectation of the appointee can be split into five key elements:

proven capability of running an effective team that delivers to the members;

proven ability to run a business and all the facets thereof; technical knowledge within the residential leasehold sector – albeit supported by technical officers in place or to be appointed;

having extensive IT awareness to maximise the use of technology to further the aims of the organisation; and having the appropriate personal skills and attributes that will include:

– an eye for accuracy, detail and quality and the ability to deliver to timescales and within budgets

– ability to get on with and communicate effectively to people at all levels – well presented and personable – being a competent and confident public speaker

As to other more specific aspects of the role the appointee will have responsibility for, among things:

Business matters:

running an office including insurances, H&S, security, presentation and cost controls; staff management including legislative aspects, discipline, setting/agreeing, roles/tasks, monitoring; performance and team leadership and motivation; accounting including internal controls, bookkeeping, VAT, budgeting, financial, reporting and year-end accounts in conjunction with the auditors; ability to recognise business risks/liabilities and take appropriate action; and setting up / monitoring operational procedures for all relevant activities e.g. membership procedures, event bookings, etc.

Technical issues:

understand the leasehold management sector and all the key aspects thereof and an in-depth understanding of landlord and tenant legislation; have a working understanding of any other relevant legislation with the ability to identify implications for ARMA and the sector; understand and oversee the technical consultants’ activities and become involved where appropriate with various legislative / regulatory issues; and oversee regulatory activities, in particular complaints, ombudsman,and the delivery of training, etc.

Public relations:

be fully aware of ARMA’s reputation and its promotion and protection; have a broad knowledge of all relevant marketing needs and activities and be able to oversee / implement annual and longer-term plans;  ability to write (or oversee the writing of) publications and other communications including booklets, guidance notes, articles, etc; act as editor of publications and other communications including booklets, guidance notes, articles, newsletters, annual report etc; have an understanding of the media, (including TV, radio, press, journals) and how to communicate therewith; be able to build worthwhile relationships with all stakeholders including government and other bodies, groups, and individuals; and know how to represent / communicate ARMA’s views to government.”

We have noted and published DCLG’s view about leasehold reform over the last couple of years – they have stated endlessly that no reform is necessary, they are maintaining a watching brief etc etc. So is the new DCLG incumbent going to turn that around and persuade Mr Shapps that action is required in the next few months?  Only time will tell.  We await an invitation to go and meet her and discuss the reality of the plight of many leaseholders across the UK.

Everything must go: Tchenguiz to sell £3 billion portfolio

Vincent Tchenguiz has put his 250,000 UK freeholds up for sale for £3 billion, and looks like he is struggling for a buyer.

The largest property portfolio which has freeholds across the country, with 15,000 in London, has been offered to sovereign wealth funds.

Now, the bankers Lazard have widened the search for a buyer, opening talks with pension and insurance funds.

The portfolio, 40 per cent based in South East, has been built up by Tchenguiz over two decades and represents freeholds on 1 per cent of the UK’s entire housing stock, and has an average lease length of 60 years.

Tchenguiz has told the FT that the portfolio would give any buyer a safe and long-running exposure to UK house price growth.

He declined to comment on which buyers had been targeted, but said there had been “several expressions of interest in the portfolio”.

Tchenguiz appointed Lazard last year to advise on what to do with the portfolio, which is encumbered by debts of £2bn.

Experts have expressed doubt over the valuation of these assets in the past.

What part of ‘go away!’ don’t you understand, Vincent?

January 26 2012: A large raspberry is likely to be blown in the face of Vincent Tchenguiz on February 4 when the peppery residents of Charter Quay in Kingston vote on whether they want him to manage their block again.

This bizarre suggestion follows the re-payment of nearly £400,000 by the Tchenguiz’s group of freehold-owning companies over the past three years – with more possibly to follow.

The three-year management order by the Leasehold Valuation Tribunal appointing managing agents HML Andertons in place of the Tchenguiz-owned  Estates and Management is due to end in August.

Estates and Management wants the site to return to its care and has told the tribunal “there is no reason to believe that there will be problems in the future”.

This a breathtaking statement, given that the Tchenguiz management was branded a “disgrace” in November last year for doling out CCTV and insurance brokering deals to his own companies.

The Tchenguiz modus operandi of buying freeholds or head leases for perhaps 1.5% of the capital all the leaseholders have paid at a development, then appointing a managing agent he owns and creating a lucrative supply of services, is well established.

It resulted in a most strongly worded LVT ruling in November last year and a £180,000 re-payment.

Residents at Charter Quay are veterans at fighting their  landlord and the assorted managing agents he owns.

Their current court-appointed managing agent HML Andertons is fighting a court action to recover rental charges for the common areas.

The case has huge significance for retirement leaseholders where rentals for house manager flats can cause the same problem.

Both can be challenged if they are outside the terms of the lease.

The case of Warwickshire Hamlets v Gedden is a good example on this issue which went to appeal to the Lands Tribunal where the tenants case was upheld. Appeal cases are important as they set precedent for the lower LVTs to follow.

In the case at Charter Quay the landlord has charged a £93,000 for “notional rentals of the common areas” in the years 2005-2009.

All five years of this “rental” were taken from the Charter Quay service charge account in 2009 just before Tchenguiz’s managing agent left the site.

Now the issue is heading to court.

If you are being wrongly charged for rentals of the common parts, the Warwickshire Hamlets case can be found here:

http://www.bailii.org/uk/cases/UKUT/LC/2010/LRX_156_2008.html

Note: The residents did decline to be managed by Estates and Management.

Find some backbone, or face the chop!

 

January 24 2012: The weakest performance of all at yesterday’s Greater London Assembly meeting on the miseries facing leaseholders was from Anthony Essien, the chief executive of LEASE, the Leasehold Advisory Service.

Asked by London Assembly members how leaseholders can be defended from rapacious managing agents and landlords jacking up service charges, Essien placed his faith in mediation.

This was far preferable to the courts or the Leasehold Valuation Tribunals, which are too complex and expensive for many leaseholders to contemplate.

But LEASE’s own mediation service was hardly a resounding success, before being wound up in January last year.

“Despite a lot of effort and publicity, demand for this service has not justified the cost and attention the organisation has given it,” said the annual report.

In its last year, there were 78 applications for the service, with 25 sessions held and 20 settlements.

LEASE’s board decided, after careful consideration, that “resources should be concentrated on those services, such as our website, email advice, telephone advice and advice surgeries away from the office, that vulnerable customers clearly value”.

One issue the London Assembly is considering is whether LEASE should not be an advocate for leaseholders’ rights rather than be best friends with all, but that would be a marked change of gear for an organisation that puts most of its efforts into sitting on the fence.

Or, to use its own words, “LEASE is committed to working with leaseholders, professional organisations and others to empower leaseholders to have more control over their property, help our customers resolve their problems and to
improve the standard of management in the sector respectively”.

How does that translate in practice when dealing with the tough commercially minded landlords determined to monetise their assets? Why is it so difficult to condemn those who hoover up freeholds, appointing themselves as managing agents, CCTV providers, lavatory attendants and the rest, and jacking up the service charges?

These have been the subject of LVT rulings again and again.

For some time the government’s “bonfire of the quangos” has been smouldering away. It looks like LEASE may be one piece of dead wood that no one would miss being tossed on the pyre.