Residents at Sandbanks at Hoylake, in the Wirral, are pondering the issue of whether to continue to have an in-house manager.
It is a later McCarthy and Stone retirement site, completed in 2008 and one of the last freeholds to be sold off to Vincent Tchenguiz’s interests, in this case, Fairhold (20), which is ultimately based via the Tchenguiz Family Trust in the British Virgin Islands.
In these later McCarthy and Stone leases the house manager’s flat had a lease from the start which belonged to the freeholder. So no porkies from FirstPort at Sandbanks: they told the residents that their freeholder owned the flat, and they were correct.
In older McCarthy and Stone sites there were originally no leases for these house managers’ flats at all. Hundreds of leases were then issued by Tchenguiz in 2009 to himself, and in the meltdown of his property empire in 2011 (when he was arrested by the Serious Fraud Office, on wrong evidence) these ended up belonging to Peverel (now FirstPort).
But at these newer sites the lease of the house managers’ flats stayed with the freehold-owning entity, and remain with the Tchenguiz group.
The ownership of these house managers’ flats is highly controversial.
The issuing of leases in 2009 and their subsequent ownership by Peverel was pivotal in taking the management company out of administration in 2012. On the basis of the portfolio, Peverel could borrow money.
FirstPort / Peverel Retirement has eagerly supported residents who want to end a live-in house manager service in favour of a cheaper visiting one as this decision – following a formal, regulated ballot by the Electoral Reform Society – means they can at last sell them off.
In their eagerness to achieve a sale, Peverel / FirstPort staff have occasionally misled residents about the ownership of the flats.
In June the regulator of the Association of Residential Managing Agents (ARMA) severely criticised Peverel / FirstPort for its handling of the proposed sale of a house manager’s flat at Mere Court, Knutsford, in Cheshire.
Residents were told repeatedly and in writing that the flat belonged to the freeholder. In fact it belonged to Peverel / FirstPort and the local staff were in for a bonus if they pulled off the sale.
It is thanks to Alex Ellison, whose mother lives at Mere Court, that this issue was considered by ARMA.
ARMA’s regulator ruled against FirstPort Retirement Services:
“In respect of the complaint about the sale of house managers’ flats the Regulatory Panel found FPRS [FirstPort Retirement Services] to have been in breach of ARMA Byelaw 2.7.10 in the case of Mere Court in 2013 in relation to a failure to disclose an interest in the ownership of the flat and payments made to individuals associated with the proposed transaction.”
At Sandbanks the house manager’s flat does not belong to FirstPort at all, and the drive to end the in-house manager’s service comes from the residents.
The Tchenguiz organisation does not appear to have expressed an opinion on the matter, although ending the house manager’s service – if done with some formality – will mean it could sell its flat.
If so, one hopes it will pay the residents a decent sum for freeing up the process.
FirstPort has been paying £10,000 into the site’s contingency fund following a flat sale, and unlike service charges this figure has not risen for some years.
At some point, the whole issue of these house manager flats assets and sales needs to come under judicial scrutiny.