The plight of leaseholders in Woolwich who are being charged thousands of pounds a year for car parking spaces, whether they use them or not, is a “non-issue”, a senior Greenwich Labour councillor has said.
Jackie Smith, one of the borough’s longest-serving councillors and the cabinet member for business, said she had knocked on every door in the Vista Building on Calderwood Street and nobody had raised the issue with her.
The Greenwich Wire revealed last week that some leaseholders in the building, a converted office block, face paying £3,000 or more next year as a charge for car parking spaces in a council-owned block next door.
One resident said she had moved out of her home to let it out so she could raise the funds to pay the bills, while another said the flats had become unsellable.
Greenwich Council struck a deal with the original developer in 2002 – the year Smith became a councillor – to let out the top three floors of the car park for residents’ use. Leaseholders currently pay £2,500 or £2,650 for a space, whether or not they use it, and face a £500 increase next year. Members of the public are charged £1,053 for an annual pass for the same car park.
The council makes £400 on each Vista bill but has never reviewed the rent, despite being entitled to do so in the lease, while the leaseholders’ costs go up by £500 every fifth year.
Leaseholders estimate the cash-strapped council, which is poised to close three staffed adventure play centres to save money, has lost up to £3.6 million through not reviewing what it charges the freeholder.
After The Greenwich Wire published the story, Greenwich Council said it would review the rent to it paid by Vista Building Ltd, the current freeholder. ITV News London followed up the Wire‘s reporting the following evening.
Vista Building Ltd insists that what it charges the leaseholders is fair and reasonable.
The Conservatives’ deputy leader, Charlie Davis, raised the issue at Wednesday night’s council meeting, asking if the council would make a commitment to end the lease in 2036, when there is a break clause, and for clarity on when the rent review would take place.
Anthony Okereke, the council leader, said: “It’s a tough situation for some of the residents out there, and I just want to pay tribute to them for the excessive costs that they’re facing.
“We are signed in and locked into those leases, we are going to be investigating it as much as possible, and we are currently in conversations.”
But after Okereke’s warm words, Smith made a less sympathetic intervention. She had been seemingly put out by Davis, who represents the Eltham Town ward, enquiring about an issue on the patch she shares with fellow Labour councillors Sam Littlewood and Joshua Ayodele.
“The Vista Building is in my ward, so thank you for being concerned about my ward, Cllr Davis,” Smith said.
“Cllr Littlewood and myself knocked on every door in the Vista building, and not one person raised a concern about car park charges, not a single person,” she said.
“We’ve only had one person, who is quite rudely in communication with us. He is a leaseholder. He rents out his property, and he is concerned about his profit. There are very few people in that building who are leaseholders who are resident there. We did speak to one, and he had no concerns at all.
“But the people that are concerned are the people that are renting out their properties and anything that they have to pay out, they can claim back through tax. It really is a non-issue.”
Earlier in the meeting Smith had to leave the chamber so a procedural vote on how much council tax is charged to second home-owners could take place. She was barred from voting because either she or her partner owned a second home in the borough.
Smith’s partner is Lord Duvall of Woolwich, who led the council for eight years until 2000. He has been the London Assembly member for Greenwich and Lewisham since then.
Habte Hagos, one of the leaseholders who spoke to The Greenwich Wire, said that he was the “rude” person who had been in contact with Smith.
He said he had written to his councillors over five years asking for a meeting about the issue but had been ignored, and had questioned her position as a councillor out of frustration.
“I don’t think they understand what is involved,” he said. “I wanted to meet them.”
“Instead of looking at the flaws in the head lease, she blames the residents and small investors who are trying to make ends meet,” Hagos added.
“If Cllr Smith was serious and really concerned about the local people she represents, she would have spoken with them to find out their concerns rather than dismiss their case without looking into why and how the leaseholders came to sign such a flawed lease. This is what local people want and expect of their councillors.
“At the very least she should have raised the huge revenue loss to local taxpayers.”
Hagos, a landlord who lets out two properties in the building, said the number of tenants in the building had grown over the years as leaseholders moved out to cheaper property to finance the bills on properties that had become unsellable.
Asked about writing the charges off against tax, he said: “I assume that’s a ‘who cares’ type of comment, but the taxman is losing out, we’re losing out and the freeholder is benefiting.”
Smith’s comments came in the week that Matt Pennycook, the Greenwich & Woolwich MP and Labour’s housing minister, launched a consultation into banning leasehold as the default tenure for new flats.
Greenwich Council appeared to distance itself from Smith’s comments in a statement issued to The Greenwich Wire on Monday. A spokesperson said: “Rent reviews and charge increases – contractual or not – come at the discretion of Vista Buildings, who lease from the council and have separate agreements with their tenants.
“Whilst we wouldn’t usually comment on private tenancy agreements, we would encourage Vista, as we would with any private landlord, to be proportionate.”
Vista Building Ltd’s solicitors previously said: “It is our client’s position that the terms of the car park leases are reasonable, fair and fully enforceable. All lessees were, or should have been, subject to the legal advice they received at the time, fully aware of these provisions and had ample and fair opportunity to consider the wording at the time the leases were granted.”
Updated on Monday at 11pm with a Greenwich Council statement.
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