14 May 2024
INFORMATION
To all owners:
As you have undoubtedly noticed, the costs charged to you for running Greenland Place have increased significantly over the last few years. In many areas the increase has been above inflation and it is almost impossible to get information from FirstPort. As a group of fellow owners, we have decided to pursue a course of action that will enable us to get more control of costs and services and replace the current manager with an alternative company that will be accountable to the owners.
We are doing this via legislation called the Right-to-Manage (RTM), which enables groups of owners to take control of their buildings.
RTM is a transfer of power to the leaseholders
Though FirstPort are named Manager under our lease, if successful, through the RTM process, we will be the employer of the development manager so we can make decisions concerning the annual service charge and running costs for the benefit of the owners.
Why are we doing this?
There has been a significant increase in service charges and other costs over the last few years; with the cost of living crisis it is more important than ever that FirstPort should demonstrate it is doing all it can to ensure that these increases are reasonable. This has pushed some leaseholders to try to understand the costs and seek to get more control over running the blocks. As leaseholders, we cannot feed into the budget-setting process or any management aspect and are unable to obtain backup information on the actual costs when eventually these are issued by FirstPort – RTM will enable us to do this.
How would an RTM work at Greenland Place?
An RTM Company operates like any Resident’s Management Company or Homeowners’ Association. It has a board of directors who act (without remuneration) as the client to the development manager instead of the freeholder.
RTM Companies are dormant, and each flat represents one member, and the liability of each member is limited to £1.
The lease structure at Greenland Place is complicated. The freeholder, our landlord, Adriatic Land 8 (GR1) Ltd is an offshore investment company represented by HomeGround who are only interested in collecting the Ground Rent and extracting as much as they can in fees from the leaseholders. They are not interested in how well Greenland Place is managed. The Manager, Barratt Residential Asset Management Ltd, was taken over in 2018 by FirstPort. FirstPort act as though they are now the landlord, which under our lease they may as well be as the actual landlord provides no oversight and is not interested in leaseholders as long as they pay the Ground Rent, which we have to do whether the Manager performs or not.
As a resident association, GPRA, we tried to engage with FirstPort, but this has proved not to be effective. An RTM is the only choice available to leaseholders to take any control over the management of the development. Whether you live at Greenland Place, or are an owner of a flat let to tenants, an RTM will deliver better value for money and arguably would enhance the value of your flat.
Several RTM companies have been set up that cover Copenhagen Court, Oslo Tower, Nyland Court, Malmo Tower and Gothenburg Court. The RTM companies have jointly set up a RTM Management Company which will appoint the residential management company to take over the management of these buildings.
Further information
RTM is the most common route for groups of owners to take control of their buildings, and there is much information on the internet.
How long will it take?
The whole process will take about 6-9 months. We must get 50% RTM membership for each RTM Company to make the claim and will only progress when we achieve that for each of the RTM companies.
To help us in our endeavour, we are using a company called HAUS. We approached other companies and have selected HAUS after considering the alternatives. HAUS specialise in RTM and manages over 375 blocks (c. 15,000 units) in London and we have received positive feedback from owners in other London developments they manage. They have experience in implementing an RTM where there are several RTM companies similar to Greenland Place. They have a 100% success rate and have helped over fifty groups of owners attain their RTM in the last three years.
Please have a look at their online reviews
HAUS has agreed to fund the cost of undertaking the RTM and will only recover this if successful. No money will be required upfront from anyone. HAUS have also agreed to a full 12-month warranty on their management fees.
Will we save money?
There is strong evidence that we are paying more than the market rate for services to our building. FirstPort has little incentive to make savings or achieve the best value for money, rather their aim is to maximise their income.
As a group of owners, we would like to see action taken on several issues around the development:
- Large increases and poor management of utilities
- Significant cost of building insurance, which has increased well above market levels
- Increase in the cost of the on-site development & maintenance team
- Other large increases, including service charges
- Lack of responsiveness to questions and issues
- Opportunity to hold EON accountable as operator of the heat network
Management Fees
We pay FirstPort an annual fee of £345 which they propose to again increase from 1 May this year. HAUS proposes charging an annual fee of X, which is more in line with market rates.
Value for Money
As a group of owners, we want to see full and transparent competition and better management for all major expenditure items including our building insurance and utilities
Will we get a better service?
Yes, because the new manager will work for us. Secondly, their fee will be 100% linked to performance, and we will be free to choose another agent if things don’t work out, and so they are incentivised to deliver. We recognise that there are aspects of FirstPort’s management at Greenland Place which are good, but believe that through an RTM we will be able to retain these, but will improve on those areas where the service provided by FirstPort is substandard.
How will the building be run?
If you become a member of the RTM Company, you are not obliged to do anything, and no commitments are required. We need to demonstrate 50% membership for the claim application.
We currently have a board of voluntary directors representing each of the 3 RTM companies. The 3 RTM companies are joint owners of the RTM Management Company that will appoint the development manager. The RTM Management Company and the appointed manager will be directly accountable to the members..
How much will it cost?
The final cost will be £80 per flat, including an estimated amount for the Freeholder’s legal expenses for checking the claim. HAUS has agreed to cover the upfront costs, which will be recovered only if the RTM is successful. As part of the process, HAUS will run the estate for one year; if, at the end of that year, we are not happy with the service provided by HAUS, this cost can be refunded.
What about the Estate and other blocks at Greenland Place?
Typically, acquiring the RTM gives control to the RTM Co of the block costs with the estate areas still under the remit of the Freeholder-appointed agent or in this case, FirstPort. In our case, the 3 RTM companies would oversee management of blocks containing 526 of the 697 units at Greenland Place. 110 units are already in blocks managed by L&Q, not FirstPort, leaving FirstPort responsible for the 61 flats in Norlem Court and in 1-33 Mandara Place. Based on advice from HAUS’s legal advisers, the claim notice will incorporate as much of the estate as possible (including the gym) as appurtenant property.
Potentially the leaseholders in Mandara Place may wish to combine with the L&Q shared owners in Chantrelle Court to set up a 4th RTM Company.
Though FirstPort may choose to retain responsibility for running Norlem Court, they would have to demonstrate the costs are reasonable, and the RTM Management Company would be able to do this more effectively than the individual leaseholders or a resident association. Once in place, the RTM Company would explore every option in order to obtain control over the whole development at Greenland Place.
Next steps
Go to Support the Landmark RTM and click on your flat to be taken through to a signing page
Who is making this happen?
We are a group of flat owners. We are all volunteers and don’t receive any payment or expenses in both monetary and non-monetary forms. We simply want to have the building well-managed and get value for money from our service charge. We are currently powerless to make any changes to how the building is run and feel that undertaking an RTM is the best way of having a managing agent who works in the interests of leaseholders.
Our focus now is in taking forward the RTM. Once the RTM Management Company is in place there will be opportunities for other flat owners to also be more involved in the actual management of the development if they wish to.
ABOUT US
Seems that update has removed my previous
My wife, Ruth and I moved to Gothenburg Court in 2017. I am a Chartered Surveyor and property director for a large London charity. I have almost 40 years’ experience mainly in commercial management of large construction projects, and have worked both in the UK and oversees.
I was Chair of the Greenland Place Residents Association set up in 2018 and though I have tried to engage with FirstPort I am convinced that an RTM is the only way that owners will ever have a say on how Greenland Place is managed and to make sure we are getting value for money