KEN LEE, our Town Hall reporter, discovers that the council has been less-than-forthcoming over the latest appointment to their loss-making house-builder
Brick by Brick has appointed a new company director, in a move that could signal the council-owned house-builder is about to change its flawed and failing business strategy and look to “sell” more of the homes it builds back to Croydon Council.
A Brick by Brick detailed plan of how they circulate millions of pounds of public money
According to official Companies House records, Julia Pitt was appointed to the board of the troubled Brick by Brick last Friday, May 1.
There has been no announcement of the appointment by the company nor by the propaganda department of the council, which wholly owns Brick by Brick and has borrowed at least £260million to fund its stalled building programme.
And while Brick by Brick is in the midst of a cashflow crisis of its own making, with long-delayed building projects (some more than two years late in completion), and few, if any, buyers for those homes that it has built, hapless chief executive Colm Lacey has turned to someone with no experience whatsoever in the construction industry to try to get them out of their mess.
Pitt, just like Lacey was before he was promoted beyond his abilities, is a member of Croydon Council staff.
Since early 2018, Pitt has been director of the council’s Gateway Services. Therein may lie a clue as to the direction Brick by Brick might be heading.
Pitt’s job at the council has been to find homes for the borough’s homeless or to assist in ensuring Croydon families avoid homelessness. It could just be that many of the homes being built by Brick by Brick but for which there are no buyers could, in future, be “bought” by the council to address its lengthy housing waiting list.
Julia Pitt: building company director with no experience in the construction industry
There’s already a precedent for this.
After the gormless Lacey and his rookie team of housing developers had it pointed out to them that they had failed to get Brick by Brick registered as a recognised provider of shared ownership homes, the council stepped in to bail them out (again).
This time, the council bought 24 unsaleable Brick by Brick properties in January and then, in March, agreed to take 119 flats in Longheath Gardens that were originally intended to be sold for shared ownership.
The total value of these little property deals between the council and its wholly-owned and deeply-indebted housing company has never been disclosed but is estimated to be close to £30million.
Brick by Brick delivering council homes, through the council-run vehicle, Croydon Affordable Housing, and effectively abandoning the Blairite myth that it will ever generate any profits to subsidise the council’s balance sheet would be an admission of a significant failure by Lacey, Jo “We’re Not Stupid” Negrini, the council’s chief exec, and council leader, Tony Newman.
But sources on Katharine Street, when told by Inside Croydon of this latest appointment, said, “It is difficult to think of any other reason why someone with the skill set that Julia Pitt has will have been appointed to the company’s board of directors at this point.”
Already on the board of directors is Shifa Mustafa, the council’s “executive director of place”. There has never been an elected representative, a councillor from Labour or the Conservatives, appointed to the Brick by Brick board since it was founded, in 2015.
Architects of the BxB shambles: Alison Butler and hapless Colm Lacey
Pitt has worked at Croydon Council for 10 years. At Gateway Services, she will have worked closely with Alison Butler, the cabinet member for housing and another of the architects of the multi-million-pound shambles that is Brick by Brick.
Pitt has “a wealth of experience, energy and ideas”, according to Butler when she confirmed her promotion to Gateway director status in October 2018.
In that announcement, Butler also said, “We will do everything we can to help our staff achieve their full potential and help them reach new and rewarding positions to make the most of their talents and experiences.”
Like Colm Lacey, for instance?
- If you have a news story about life in or around Croydon, or what to publicise your residents’ association or business, or if you have a local event to promote, please email us with full details at inside.croydon@btinternet.com
Inside Croydon is a member of the Independent Community News Network- Inside Croydon works together with the Bureau of Investigative Journalism and BBC London News
- Inside Croydon named Journalist of the Year at 2018 Anna Kennedy Online Autism Heroes Awards
- ROTTEN BOROUGH AWARDS: For three consecutive years, 2017, 2018 and 2019, Inside Croydon has been the source for award-winning nominations in Private Eye magazine’s annual celebration of civic cock-ups
- Inside Croydon had 1.6million pages viewed by 721,000 unique visitors in 2019
There is little if any logic in the way the Council is behaving in relation to Brick by Brick. It is almost akin to the director of a Ponzi Scheme believing his own hype to the extent that he invests in his own company!
Would it be indiscreet to ask if the directorship comes with emoluments ?
Of course not!
Yes, the directors have been paid.
If this is the direction Croydon Council want to take their development arm, they need to wind Brick-by-Brick up and set out a new business model. The current Brick-by-Brick business and procurement model is not going to allow units to be sold back to the council without losing shed loads of money.
And if this is they way they wish to go, the Council should be seeking alternative tenders for all Brick-by-Brick development projects to ensure they are getting value for money. Private developers should be invited to compete against BxB.
40 no. mixed tenure council units from a private developer will be substantially more cost effective for the council than using the current Brick-by-Brick procurement route and favoured architects panel.
Day by day this lot become more like Trotter’s Independent Traders! Shameful shenanigans.
143 homes for £30 million is about £210k each. Which seems a reasonable price though I know little of market prices having social rented all my life with never any prospect of anything else. Internet says the average price in Croydon for a flat is £265K and a terraced house is £358k. I don’t know if a private developer could do it for less, but what is certain is that if they did, less than 40% would be for social rent. The implication of the article is that purchased as council homes they would be let at council [= social] rent. I don’t really care how they do it if this results in 143 homes for social rent, which is the most desperately needed form of housing.
The lack of delivery of homes for social rent has been the over-riding scandal of the Brick by Brick scheme, promoted by a Labour-run council, since the details of its developments began to emerge.
Some points of detail, Anthony:
1, £30million is a low-ball estimate of the price to be paid. The council has never released the figure it has agreed to pay. With BxB’s well-established record of failing to deliver on time and on budget, the cost of building these homes may well exceed that.
2, Croydon Council Tax-payers have already paid for these homes to be built. They are on what was publicly-owned property (most of which was sold by the council to BxB at a considerable discount), and built using £260million public money borrowed by the council from the Public Works Loans Board.
3, Brick by Brick never intended that these homes would be for social rent, but imagined that they could sell them in shared ownership schemes. So much for that cunning plan…
Strikes me as this is simply another stage in the saga of: “we don’t really know what we are doing, the council is paying, let’s try something else, lets zig when we could zag, no let’s try something else, that doesn’t work but who cares?, money isn’t a problem, the council pays and will continue to pay…”.
In brief, a lack of overall direction and accountability.
I’ve had a look at Brick by Brick’s board of directors and there isn’t one with a credible background in true commercial development per se, but lots of mish-mashed local government experience.
If it is correct that Croydon Council have never refused a planning application for Brick by Brick [Ed: it is] it may mean that they can’t refuse them due to pressure from elsewhere in the organisation.
I think its marvellous and would love to work for Brick by Brick: no penalties for failing to deliver, no sanctions at all, untouchable and bankrolled by a local authority. Wow, nice work if you can get it.
Sounds like someone wanted to be a property developer and couldn’t quite make it…
Well said. He’s known as Mr Developer in the industry because it’s ironic he’s a CEO of a commercial company *ahem* ways worked in the public sector he’s got no commercial nous. Before Joey took him under her wing, he was (unsuccessfully) applying for everything but couldn’t even get a senior job let alone a CEO. The sector is laughing at him, if it wasn’t for trade press on design he’d just be a failed council officer in a failing part of the council.
Your satirical over-simplification of how Brick-by-Brick works, and the ridiculous caption under your image showing the “detailed plan”, is an indication that you’re heavily biased against the scheme and not interested in either understanding it, nor representing it fairly to your readers.
Terribly sorry if the sum and substance of following the underhand, poor-performing, over-budget, late-delivering, three council flats in five years Brick by Brick is regarded by you as an “over-simplification”. We’d disagree.
We are talking about an organisation which has had more than £260million of public money here, and goes out and squanders considerable sums on PR firms and crisis management advice (which they sorely need, having caused their own crises).
But if you think you can represent BxB “fairly” to our readers, you’re welcome to go ahead and have a stab at writing it yourself.
Please be aware:
1, You’ll be liable to turn yourself into the laughing stock of Croydon; and
2, We charge fees for advertising.
Of course, we stand by everything we have reported about the loss-making clusterfuck that is Brick by Brick.
I’ve had another idea about the criticised diagram/ cartoon. This would be a cross between an algorithm/ flow chart and cartoon. Firstly, I think showing a map of Croydon with trees on it is too much of a compliment. There won’t be any green spaces to show trees in Croydon if Brick by Brick get their way. So the new model would need lots of little £ signs (our Council taxes) going into Fisher’s Folly, then a big £ sign coming out of Fisher’s Folly into a certain George Street showroom, then an arrow heading from there into the ground with £‘s tumbling into a money pit. No point showing too many completed houses, as there aren’t too many completed houses! So the arrow would need to point to Fisher’s Folly (with the few houses coming out of the money pit) and then the Fisher’s Folly £ signs would need to point back to George Street in a closed off loop. In effect, going nowhere!
The algorithm would need to be as complicated and useless as the BxB project but maybe it would help BxB supporters to understand the actual process better.
You assume that people who read and understand Inside Croydon’s journalism are being brain-washed, which is a patronising position for you to adopt. If Inside Croydon’s findings and journalism are as inaccurate as you state, they would have “had their butt‘s sued off” many years ago, not just on this issue but on a myriad of injustices etc that they have highlighted.
They are by no means a one trick pony and they provide a valuable service to a Borough that has no other notable local media outlets.
Many of the readers and commentators have a good knowledge of how local government should operate and a degree of intelligence that helps them to discern incompetence. They need to remain free to state their views.
You are, of course, entitled to an opinion and I, of course, am entitled to say how wrong you are on this one.
Chase, since you raise a question about the illustration above which is taken from the BXB website, I also take issue with it.
Not because of the Inside Croydon caption which I consider to be entirely correct, but because of the patronising quasi-Naïve style the drawing adopts. This style is usually defined as visual art that is created by a person who lacks formal education and training. When this aesthetic is emulated by a trained artist, as BxB has attempted to do, the result is sometimes called primitivism, or pseudo-naïve faux art which should only be used by a company that’s completely on top of its game, or be at risk of appearing a bit faux itself.
It is likely the illustration is drawn by someone in Brick x Brick’s in-house Architectural Practice, Common Ground.
What private developer do you know has his own in-house firm of architects? If a private developer wants architectural advice, he employs an architect. BxB consults an in-house architectural team and then engages an outside architect to do it all again. They are buying the service twice. Another reason why BxB is simply not functioning in the proper business world.
This might explain why on BxB’s website yesterday, it listed all the architects in Common Ground as being part of the BxB development team. These names today have mysteriously disappeared from the website. Where have they gone? And who funds them anyway? BxB or Croydon Council? Some clarity, Colm?
A naïve style is often used when the illustrator is asked to communicate something to an audience that is incapable of understanding more formal work. As such it is patronising, insulting and inappropriate but does communicate one thing: that Brick by Brick and the ruling Cabal of three think that the people of Croydon are fools. Everything they do and say exemplifies this, from the half-truths about Westfield to the real, real costs to each and every one of us of Brick by Brick.
So let me see if I understand this idea, Brick by Bricking It are building houses using Council funding that they are then going to sell back to the same Council for more residents money? Someone explain how this is NOT fraud.
Its really a sort of corporate Ponzi scheme.