Croydon Council has sold at least three packages of publicly owned property – in Waddon, South Croydon and Fairfield wards – to Brick by Brick, its house-building company, for just £1 each.
And last year the Labour-run council also flogged off public green space in Upper Norwood to Brick by Brick for a bargain £250.
The council-owned house-builder has just put the 15 flats and 15 “family houses” which it has built on that Ravensdale and Rushden site on the private housing market. All together, the homes are on sale for a total of more than
£16million.
The Brick by Brick marketing blurb, published last week with the release for sale of these homes, states, “Family houses in neat low terraces, and a landmark building of two bedroom apartments, just off Beulah Hill in Upper Norwood. The houses have private gardens as well as a new play area for children, while many of the apartments have wonderful views to the south. Perfect for growing families and anyone looking for a sense of space. Well connected to Crystal Palace, and an easy commute into Central London.”
None of these new homes being built by Brick by Brick are available as social housing or council homes, of the kind which might actually provide a roof over the heads of those on Croydon Council’s ever-lengthening housing waiting list.
Brick by Brick’s first properties are predominantly for private sale
The land on which they have been built was previously public open space used by social housing tenants living in 1970s-built blocks, but who were largely ignored by council consultations and planners when the Brick by Brick scheme was put forward.
Brick by Brick was formed by the council in 2015. The model of using publicly owned land and property to build new homes was the brainchild of Jo “We’re Not Stupid” Negrini, the council chief exec, working closely with the Blairites who control Croydon council.
Negrini’s cunning plan was presented as a means of overcoming the housing crisis in Croydon. By utilising small pockets of public property to build on, so went the spiel, the sale of some of the new homes could subsidise the provision of accommodation for the homeless. All receipts, including land sales, would, we were assured, come back into the council coffers to help pay for front-line services.
The reality, however, is somewhat different, and the sale on the cheap of some of the council’s assets to Brick by Brick ought to sound alarm bells at the Town Hall.
“What they are doing is positively Maxwellian,” one Katharine Street source said, referring to the entirely opaque financial arrangements of the former Labour MP and Daily Mirror publisher Robert Maxwell.
Indeed, the very idea that receipts from the land sales might be used to fund public services is deeply misleading. Councils are prohibited by the law from using capital receipts to do this.
Here in Croydon, the council has borrowed £262million from the Public Works Loan Board, which it has then loaned on to Brick by Brick on favourable terms for it to run its business. Last month, still without a single new home completed, Brick by Brick had its begging bowl out again, asking the council for another £78million loan.
Those loans were in part supposed to pay for the purchase of council property, at market rates.
Yet some decent digging by the Bureau of Investigative Journalism’s Bureau Local team, together with the Huffington Post, has unearthed details of property deals in which Croydon Council has sold at least three plots of land to Brick by Brick for as little as £1.
These include garages and land south-west of Heathfield Road and Coombe Road (in a deal that went through on May 8, 2018), the garage block at Thornloe Gardens in Waddon (May 8, 2018), and garages and land at Montpelier Road and Kingsdown Avenue in South Croydon (April 4, 2018).
The Kingsdown Avenue-Montpelier Road site public open space, flogged off by Croydon Council for just £1
All of these sites are now under development by Brick by Brick, and all of them were opposed by existing residents, who complained about overdevelopment in their neighbourhood and the loss of amenity space, and who have had serious cause for concern over the lack of proper safety precautions being used by the developers’ builders over the stripping of asbestos from the demolished garages or the road traffic diversions caused by their works.
Of course, land value can be reduced if a site is particularly difficult to develop. Whether any pocket of land in south London, however awkward, is worth only £1 at today’s prices would seem unlikely.
Not all of the land purchased by Brick by Brick from the council has been flogged off for as little as £1. The Brick by Brick development site close to Ravensdale and Rushden, at Auckland Rise, Sylvan Hill and Church Road, for example, was sold by Croydon Council on March 1 last year for £1,327,071.
And while that might seem a much better deal for the public finances than the mere 250 quid charged for the land across the road, given the size of the property that has been sold off by the council, Brick by Brick appears to have landed another bargain. Or the Croydon public has been sold short again.
The Auckland Rise-Sylvan Hill-Church Road site is described in estateagentspeak by Brick by Brick as “one- and two-bedroom apartments in a leafy enclave in Upper Norwood”.
They have built 57 flats in six blocks on that site. These, too, were put up for private sale in the past week. One-bedroom flats are going for as much as £395,000, and two-bed apartments are on the market for nearly half a million pounds. Shared ownership and help to buy are offered to potential buyers, but there’s nothing so crass as council housing or flats for social rent available.
Brick by Brick’s flats in the Auckland Rise-Sylvan Hill-Church Road “leafy enclave”, on public land snapped up for less than £1.5million, could end up fetching more than
£21million.
That should go some way to Brick by Brick paying off its borrowing from the council, at least…
In the latest edition of the council’s Your Croydon magazine, Tony Newman brazenly states that, “As council leader I have always been determined to be completely open about the council’s finances.”
Tony Newman: Croydon’s Blairite leader has been flogging off public property on the cheap to build private housing
Yet the council continues to withhold vital information regarding the interchange of public property with Brick by Brick.
In all, Croydon council disposed of 25 packages of public land in 2018, generating £4,517,146. Many of those sales went to Brick by Brick.
Few of the sites sold to Brick by Brick are thought to have managed to raise the proper market value, but Croydon Council is refusing to answer questions about who conducted the valuations on behalf of the people of Croydon, or how they arrived at their valuations.
The council is trying to claim that its property sales to Brick by Brick have been done “responsibly”.
“The money we get from responsibly selling some assets and council land has helped us to protect jobs, maintain frontline services for Croydon people and allow for much-needed local homes,” was the line from a council spokesman.
“With demand for council services continuing to rise while the Government continues to cut our grants, our medium-term financial planning is about balancing the books while making best use of all our available resources.”
How Croydon Council intends to “balance the books” when selling off tracts of public land for as little as £1, neither the council spokesman, Tony Newman nor Jo Negrini have yet to say.
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So four pieces of land sold off for less than the money given to an out-of-borough football club by O’Connell. It seems we’re being shafted all ways
I wonder how such cheap land sales fit within the State Aid rules. If Negrini wants to flog off any more £1 plots, perhaps she can let me know and I will buy a couple.
It doesn’t sit easy when elected Councils act like robber barons.
To be fair, that green space on Beulah Hill was used by literally nobody. The parks in that area – with the exception of Westow Park – are very under-used generally, for reasons I can’t quite fathom.
Having said that, there was previously space for a linear park, green walking trail and/or off-road cycle route along Beulah Hill from Upper Beulah Hill to Queen Mary Road (I suspect left over from 1960s road widening which never happened), it will now be very difficult to realise anything of the sort.