Site icon Inside Croydon

Brick by Brick’s unsold homes are costing Croydon a fortune

insidecroydon

Despite there being a ‘housing crisis’, the council’s failed development company is struggling to sell dozens of its homes. As housing correspondent BARRATT HOLMES reports, £440,000 for a two-bed shared-ownership flat is putting off buyers

Unsold, or unsellable?: almost three years after work on site was completed, six flats at Heathfield Gardens remain on the market

There’s good reason that loss-making Brick by Brick continues to make massive losses.

It’s because the council-owned development firm has taken far too long to develop and then sell its properties.

And those flats it was meant to be providing as “affordable homes” have mostly been put on the private market as hugely expensive shared ownership properties.

Take as an example what is now being described as the “final phase of development” in Heathfield Gardens, in South Croydon, one of the controversial in-fill sites which took away existing residents’ garages and green space.

Here, Brick by Brick properties are being marketed at £440,000 for a two-bed flat.

Colm Lacey was the former council executive who was at the helm of heavily indebted Brick by Brick as it crashed the council’s finances. But Lacey never managed to get BxB registered as a recognised provider of shared ownership homes, even though this was how almost half of all the company’s new builds were to be sold.

It is nearly three years since Brick by Brick had to recruit the help of So Resi, a company that is registered to sell shared ownership homes, to do that task for them.

And it is almost three years since building work on the Heathfield Gardens site was completed.

Yet So Resi are still trying to find buyers for six of the properties. Total value: around £2.4million.

Tight fit: the Heathfield Gardens flats are being sold as suitable for families with children

That’s £2.4million-worth of loans and interest payments not yet paid back to Croydon Council by Brick by Brick (less, of course, the commission payable to So Resi for doing the sales job that Lacey and his BxB executives deemed to be beneath them).

So Resi are also marketing 18 one- and two-bed homes on Tollers Lane in Old Coulsdon, as well as 15 homes on Malling Close in Woodside. Do the math…

All of these homes are the result of the work of some fashionable architects’ firm – who were no doubt paid their fees years ago. But this all played to the ego of Lacey and his chums, as they displayed the various awards that their very costly schemes attracted from their mates.

All of the homes feature interiors with top-end specs, which increased the cost of building the unit, and so increased the ultimate sale price, making the properties more difficult to sell in a competitive housing market.

“These spacious apartments have parquet timber flooring in the living areas,” says the sales brochure, which reveals “key features” as including “Composite stone grey worktops and Bosch appliances”. None of which comes cheap.

When architects Michail Riches did their work, there were 13 apartments and seven maisonettes at Heathfield Gardens – so only two-thirds of the homes have managed to sell so far.

At Heathfield Gardens, a quarter share of a two-bed flat will see any prospective buyer paying almost £1,400 per month. This, remember, was what Labour councillors Paul Scott and Alison Butler, together with their chum Lacey, were passing off as “affordable housing”.

Losses: Colm Lacey, responsible for the disaster that was Brick by Brick

In the latest set of annual accounts for Brick by Brick, for the financial year 2021-2022, which were published last week showing a loss of another £20million, the directors’ report warned: “The current economic climate has raised challenges in selling the remaining units, as individuals face difficulty in obtaining mortgages and investors evaluate the current and future interest rate and inflationary conditions.”

And they also noted: “The company has incurred a net loss of £20million, in large part due to write downs in expected sales prices for undeveloped land and bulk sales of developments required to wind down the company’s activities.”

According to the report, the winding up process could stretch into 2025 – five years after loss-making Brick by Brick helped tip Croydon Council into bankruptcy.

Read more: Brick by Brick abandons its planning consents and 23 sites
Read more: #PennReport: Cover-ups and denial over Brick by Brick failure
Read more: CEO of loss-making Brick by Brick gets cosy job with architects
Read more: Negrini’s gone silent over secret subsidies to Brick by Brick


Exit mobile version