Freehold sale now adds to the saga of those missing millions
19 November, 2020 — By John Gulliver
The apartment building next to Talacre Park
THE property company thought to owe Camden Council millions of pounds as an unpaid debt is offering the freehold of a controversial block of flats for sale for a price of £4.3million.
This is the latest astonishing twist in a saga that goes back years after the council made a deal with the company allowing them to build the block in Talacre Park, Kentish Town.
The prestigious site on the edge of the open space was sold for just over £300,000, leading ultimately to the sale of 36 private flats for an estimated total of £21m.
Part of the “conditional sale of agreement” committed the company to make a special payment based on the profit made on the sales – known as an “overage” – estimated to reach nearly £4m.
But this was never paid to the council despite debt-chasing efforts by officials. Frustrated officials then sought legal advice only to be told by a leading lawyer three years ago that it was a “lost cause”.
The notice of sale of the freehold sent to tenants
All this happened behind the scenes and may never have been made known to the public until a retired Kentish Town forensic accountant, Nick Harding, embarked on dogged detective work several years ago firing off scores of emails to the Town Hall and requests for Freedom of Information documents and checking the property credentials of the company at the Land Registry. His one-man campaign irritated council officials who at one time dismissed him as being “vexatious”, but he ploughed on.
After I began to cover the growing scandal, two senior councillors, Richard Olszewski and Danny Beales were briefed by officials and then held an online discussion via Zoom a few weeks ago with Mr Harding and fellow Kentish Towner Brian Lake who lives near Talacre Park.
The councillors confirmed that the debt had not been collected – one of the many hurdles was that the company was based in a tax haven, the British Virgin Islands, not easily subject to legal redress in Britain. Critics of Camden’s housing development policies have warned of the risks involved in dealing with overseas company but the practice continues. Recently, land has been sold in Somers Town to an overseas company which has been allowed to build a massive tower of private flats in exchange for “affordable social housing” and a contribution of millions of pounds to help build a new school.
The councillors picked to investigate the scandal have not been in contact with Nick Harding or Brian Lake since their Zoom meeting – and it looked as if the council had abandoned the debt.
But in the past week two of the leaseholders at the block contacted both campaigners – and this newspaper – to reveal that the property company, Hazlewood Properties Ltd, is offering the freehold for the building for £4.3m to all the leaseholders. It is understood that under the law, a freeholder should first make an offer to their leaseholders before putting it on the open market.
The letter sent to all the leaseholders – which I have seen – came from a well-known West End firm of solicitors, known to this newspaper. Then, suddenly, to add another chapter to this mysterious turn of events, it seems the property company is now using another firm of solicitors based in Holborn.
The letter to the leaseholders set out, among other things, the ground rent each occupier is responsible for, which range from £350 annually to £600. This is important because a potential investor would wish to know the gross value of the annual ground rent of the block.
The individual ground rents for the leaseholders are standard, but somewhat exceptional is the annual £194,000 rent chargeable for the ground floor Medical Centre.
In contrast, the total from all the individual flats would be around £10,000. This means a freeholding owner of the block would collect more than £204,000 a year, which would make it a sound long-term investment.
But it remains puzzling how the NHS which, effectively funds the Medical Centre, could have agreed to pay such a high annual rent of nearly £200,000 for a 20-year lease signed in 2014.
Hanging over the block is another shadow – alleged poor workmanship carried out as it took shape more than eight years ago. Two leaseholders have contacted me with complaints involving boilers and their flues.
A leaseholder told me this week that it was “indeed strange” how much the Medical Centre pays in annual rent. But his main concern, and that of other leaseholders, apparently, is the difficulty in contacting the owners who have changed solicitors. “We wrote to the new solicitors about the freehold offer days ago but have still not had a reply,” he said.
“I am also concerned that the company apparently owe Camden Council money and all this means the public purse has had to bear the cost of the debt.”
Faced with the latest revelations that the owner, Hazlewood Properties Ltd, is apparently attempting to cash in on the block through a freehold sale, Nick Harding wonders whether the council will lose out again.
As for the council, it seems unaware of the latest activities of the company it is supposed to be chasing for a scandalous debt that some believe could be recovered through legal action.