FAQs

I hear you are going to give votes to tenants?

This isn’t true, however we believe that tenants are a very critical part of Pan Peninsula as roughly 70% of residents are tenants, therefore we need to be very mindful about decisions which impact the living experience in PP as that could result in lower rental values and therefore lower sale values. As such we are proposing running regular Opinion Polls to gain a clear understand on what tenants think of the building and to find out about their thoughts on any potential changes ahead of any leaseholder only voting.

How are you going to ensure everything is democratic?

The new proposed constitution calls for a yearly vote held in the run up to the AGM, leaseholders put themselves forward as candidates for the committee, and the leaseholder membership votes on which candidates they want to represent them over the next year to be part of a smaller more focussed 5 person committee, the results of this vote are then announced at the AGM. This ensures that every year the committee members are elected based on their individual merits and value they can bring and leaseholders are given ample time to decide who is best placed to represent them.

In addition throughout the course of the year any major decision will be put to the leasehold membership for a vote with the democratically voted committee following through on the decision of their majority of leaseholders.

What about the 50% membership? I hear that Ballymore have to do what we say if we get 50%?

50% membership is actually the amount a Residents Association needs to be formally recognised, The PPLRA are recognised and Ballymore technically recognised them when they didn’t have the required membership. Having 50%, 60%, 70% etc gives no additional control over Ballymore or more of a voice that doesn’t exist already through the recognised status.

But doesn’t 50% membership mean we can then go for Right to Manage (RTM) and remove Ballymore?

To go for RTM you need to get 50% of leaseholders to sign their names to agree to move forward with the RTM. 50% membership doesn’t automatically give the right to this. Assuming only 75% of the actual RA membership agrees to move forward and signs their names (e.g. some are overseas, some are busy, stale data, might not agree with it, etc) this actually means the RA probably needs a minimum of 66%+ membership, and possibly even higher up to 70-80%.

Okay, but if we get the 50% to agree to move forward we can then go for RTM?

Technically yes, the challenge then comes in the structure of our buildings and what are referred to as Estate Services which includes all areas that are not residential floors (i.e gym, lobby etc). In 2012 the case of Gala Unity Limited v Ariadne Road RTM Co Limited set a precedence that these services would be taken over by the RTM company. However this precedence has been overturned at the Court of Appeal in the 2022 judgement of Firstport Property Services Ltd v Settlers Court RTM Co Ltd & Others –  details and video of the judgement summary below:

https://www.supremecourt.uk/cases/uksc-2020-0066.html

https://www.supremecourt.uk/watch/uksc-2020-0066/judgment.html

The current thinking based on research done by members of the ‘Super RA’ is that each building in an Estate with separate addresses would need independent RTM companies unless they could be legally classed as a single building (it is currently unknown if this is possible but there are lawyers looking at it). For this process an RTM company needs to be setup by residents where the residents are the directors and it is this company that then appoints the managing agent if the RTM is granted by a court, the directors of this company also become legally liable at this point for the managing agent and any decisions made.

At PP this would mean East and West having separate RTM companies and there would also need to be a freeholder appointed RTM company for the Estate Services, technically leaving us with 3 RTM companies. As it would be impossible to proportion costs or manage the Estate services as argued in the case above it’s unlikely under the current legislation that RTM would be granted by a court.

Losing an RTM battle in the courts would be extremely costly as we would end up paying for both our own and Ballymores legal fees.

If we managed to pull it off though we could get a new company in to manage the building?

Yes, however the ‘Super RA’ have been researching possible managing agents for 12 months as part of a possible portfolio wide switch. We believe that a large established managing agent with a history of managing tall buildings would be required due to the scale and complexity, skills required and buying power for the maintenance of the complex Estate Services. Unfortunately nearly all we have approached have said they would be reluctant to take on the management of existing buildings with these complex Estate Services due to their age and unknown liabilities, coupled with the challenge of a likely strained relationship with the freeholder after the RTM process. This is easier in small blocks of flats or housing where the freeholder would have minimal involvement.

In addition during our research we have found a substantial amount of data from leaseholders in buildings run by the majority of these these managing agents with stories very similar to our own, and they might actually be just as bad or even worse than BAML. So there is a serious risk of actually making things worse.

So what are our other options aside from RTM?

They are 2 under current legislation.

The first option is commonhold but that sufferers similar problems to the RTM approach and it hasn’t been proven yet in a building with these complex Estate Services. Also there are questions on who controls the standards and quality of the building within the commonhold, for example who is responsible for monitoring changes to the internal structure of a flat and ensuring it still meets the fire safety requirements of tall buildings? If somebody was to take the walls out without meeting BS9991 and a fire was to start that spread through the building who is liable for it? And would the insurance still be valid? 

The second option is the path NPW have decided to explore and this is buying the freehold outright which is also known as Enfranchisement. However there have been major challenges uncovered here too a) Ballymore sold our ground rent to an external company in 2016. b) there is no building in the UK with complex Estate Services that has gone through enfranchisement that we have found and as such there is no example or blueprint to follow. c) The legal framework is more complex and costly and would require considerably more engagement from leaseholders than we currently have in Pan Peninsula. NPW has 80%+ of leaseholders and their RA are engaged on a day to day basis which is why they believe it is something they could make work.

This is very depressing, what can we do?

Since we ran the public media campaign again Ballymore in 2021 they have been more engaged with the RAs involved and the ‘Super RA’. While we aren’t seeing everything we would like, there is now more collaboration then at any point and we have been provided with access to data and information on PP and the operation which far exceeds anything previously available. We have also been fostering a more collaborative relationship with BAML and the team at PP and believe in the short term this is the best option to bring improvements to the building.

If there are any more questions please add them into the comments section below.