Empty homes: architecture correspondents in the posh Sunday papers have waxed lyrical about Mary Duggan’s architectural designs for Lion Green Road car park in Coulsdon. But they haven’t helped to find a buyer for the site

Our housing correspondent, BARRATT HOLMES, on the growing disquiet over the fate of 157 flats in Coulsdon that have been standing empty for more than a year

There’s a number of reasons that Croydon Council is boracic, and one of those is the £200million of loans handed to useless building firm Brick by Brick. Another is the current administration’s inability to flog off the last remaining homes from the property development misadventure.

It’s a year since it emerged that the council was negotiating a deal with Notting Hill Genesis, a housing association, for them to acquire BxB’s 157 architect-designed flats on Lion Green Road, Coulsdon.

A price tag of around £40million was mentioned for what the marketing department at Brick by Brick had labelled Red Clover Gardens, and the reasonable fear was expressed that the council would off-load the property at less than its market value.

While some Coulsdon residents dropped their pearls at the thought of housing association residents moving in just up the road from the local Waitrose, others were concerned that the agreed split of private sales, unaffordable shared ownership and homes for social rent might not now be delivered.

Finishing touch: it’s been more than a year since builders finished work on the Coulsdon site

One year on, and the only occupants of Red Clover Gardens with a secure tenure are those who have moved in to the bug hotel constructed in the gardens.

Here we are in 2023, in the middle of a housing crisis, and 157 council-owned homes stand empty, cash-strapped Croydon unable to cut a deal to sell the property.

Notting Hill Genesis had pulled out of their deal earlier this year. They were too discreet to say why; chances are, they wanted the flats for at least £10million less than Croydon’s asking price.

But the council found another buyer, called Regen Capital, where they were to use more complicated, opaque lease-back arrangements and other financial gymnastics.  What do you mean, had they learned nuffink from the Brick by Brick and Croydon Affordable Homes experiences?

Croydon Tories posted a self-congratulatory announcement on their own website last July stating that Regen Capital “… will acquire the freehold to the development”.

And they added, “The council will take on a long lease for the affordable units but will immediately sub-lease them to Mears or one of their registered providers.” The tenants, the Tories said, “will become Mears tenants with the council not involved in any day-to-day management of the tenancies or the properties”.

Seventy-two of the flats would be Regen’s to rent or sell, according to the Tories.

This deal had to pass through cabinet and get approval from Mayor Jason Perry, and duly did. All would be done by August, we were told, the money was as good as in the bank, or at least paying down a chunk of the council’s debt.

Closed off: the fences have been up around the site for more than a year, and with no date yet for when the deal on Red Clover Gardens will be complete

Five months later, and Jason Cummings was facing questions about Red Clover Gardens at Wednesday’s full council meeting. The flats are still empty, the deal still not done.

And what, exactly, is the reason that Regen Capital appears to be such an under-capitalised business? And what exactly is the deal with Mears Group, a company that just happens to have contracts with the Home Office for housing refugees?

Nothing to see here, according to Cummings.

“It is perfectly normal for organisations to create a dormant business with low-issued capital for the purpose of negotiating property deals such as this,” Cummings told the Town Hall.

“Indeed, it is perceived as good practice for a new commercial project that the developer create a new company for any new business venture. Not only does it make the accounting clearer, it limits the liability for the project to the new company and in some cases delivers tax efficiencies to the project.”

“Tax efficiencies“. That will be businesses avoiding tax, then… Cummings, remember, the man who helped hike your Council Tax by 15% this year, wants to be the Conservative MP for the new constituency of Croydon East.

With residents in the south of the borough also asking awkward questions about the shadowy company behind the deal to build 240 flats on the site of Purley Pool, which also has the enthusiastic support of Mayor Perry, Cummings and Croydon South Tory MP Chris Philp, suspicions about the corporate structure and capabilities of Regen Capital are being aired across Coulsdon.

Cummings says there’s nothing to worry about. He reckons that the council officials who checked out Velo Smart City before they decided to pull up all the council’s bus shelters are on the case and everything will be just fine. Oh, and if you ask too perceptive a question, he won’t be able to answer it because of “commercial confidentiality”.

The council, Cummings said, is conducting “due diligence”, and is checking “the track records of the people involved”.

“When negotiations are complete the final documentation will set out in clear terms the commercial relationships between purchaser, funder and lease-holder,” Cummings told the concerned Coulsdon resident who asked the discomforting question.

Trouble is, the council’s version of events is not stacking up. Again.

At a meeting with Coulsdon residents’ associations at the end of November, MP Philp described prospective buyer Regen Capital as “a housing association”. Which the company assuredly is not.

Running up costs: the grass has been kept neatly mown around the five blocks at Red Clover Gardens, even though no one’s living there

In the meagre details that the council has been forced to release about the possible sale, it appears that there is to be a significant change in the occupancy mix of the flats, something which ought to require retrospective planning consent.

Search the shareholders of Regen Capital at Companies House, and you will find three individuals with no record of involvement in any business of substance.

Ben Pearce, from Grays in Essex, is not only a director and shareholder in his own name, but also a director and shareholder of Ranson Holdings Ltd, who hold 25% of the share capital of Regen Capital.

This 25% holding was registered on December 6, 2023. Ranson appears to be a very small property management business (assets of less than £1million) who owe more than they own.

“I understand that Mears Group Plc are a company of substance, but who will lend on the covenant described in the council statement issued in July?” said Paul Eversfield, the resident who asked the Town Hall question.

Another resident who watched this week’s Town Hall meeting found no reassurance in what Cummings had to offer. “The council’s in deep enough trouble as it is thanks to its various failed business deals – and I don’t just mean Brick by Brick.

“Our councillors and council officials are seriously out of their depth when they dip their toes into the shark-infested waters of business, particularly in the property sector.

“Nothing we have been told at the council meeting is in any way reassuring that the Council Tax-payers of Croydon won’t end up paying for their folly yet again.”

Read more: Brick by Brick’s unsold homes are costing Croydon a fortune
Read more: BxB’s collapse was predictable. Why did no one else notice?
Read more: Brick by Brick CEO says company has sold 6 houses. Or is it 5?
Read more: Building towards the council’s financial ruin, Brick by Brick

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