Leaseholders Face Huge Bill In Latest Grenfell-Style Cladding Row

7 February 2018, 17:39

A large apartment complex in east London is the latest and biggest site to face a huge bill to remove Grenfell-style cladding.

The 1,000-flat New Capital Quay was built four years ago and sits along the Thames in Greenwich.

Galliard Homes, which finished building the flats in 2014, owns the freehold and manages the site.

It, however, says it is not responsible to remove the cladding or pay for the 24/7 fire wardens on site which costs over £1m a year.

The company instead says leaseholders should take up the issue with warranty provider, the National House Building Council.

It’s reported the bill to pay for the cladding could cost between £19m to £40m.

The issue has meant the flats are unsellable with potential buyers also being put off.

The incident is the latest in cladding-related incidents in London.

Residents at a housing complex in Croydon are facing a bill of £2m after the building’s owner, Citiscape, said it was not its responsibility to pay for similar cladding work.

In a statement sent to LBC, a spokesman from Galliard Homes said: “New Capital Quay, a predominantly residential development in Greenwich, was completed in phases from the summer of 2013.

“There are 11 blocks on the project with a total of 1002 apartments plus a supermarket, offices and other retail outlets.

“Following DCLG guidance in the summer of 2017, tests were carried out on the external cladding materials at NCQ.

“Those tests confirmed that the cladding was of the ACM type material, not the same product but similar, to that discredited following the Grenfell disaster in June 2017.

“At the time of construction, the cladding material was widely used and approved for buildings like those at NCQ.

“The material specified by the Architects, bought and fixed by the sub-contractors was designed and detailed on the understanding that it was in full compliance with the Building Regulations.

“Under Building Regulations these designs, specifications and details need to be examined and confirmed as approved by an external party (an Approved Inspector).

“At NCQ the Building Regulations Approved Inspector was the NHBC. The NHBC reviewed the designs, drawings, specifications and the installation works on site – at the end of the project the NHBC confirmed, with the issue of Final Certificates – full approval that the works were in compliance with the Building Regulations.”

They continued: “In the residential property market in the UK, the position regarding warranties and protection for homeowners is very clearly defined by the ‘Council of Mortgage Lenders’.

“The ‘CML’ rules provide that new homes should come with a ‘CML’ approved warranty – a single warranty that is designed to be a ‘one-stop-shop’ protection point for the security of the homeowner and of course the bank providing the mortgage.

“The list of accepted warranty providers in the UK is, perhaps surprisingly, short – with only approximately a dozen organisations approved by the ‘CML’.

“By far and away the market leader in providing this insurance is the NHBC. At NCQ the protection personal to each homeowner, is the NHBC Buildmark Warranty.

“This insurance is for the direct benefit of each leaseholder at NCQ and is in place for a period of 10 years from the original Completion.

“Unlike the majority of insurance policies, there is one premium to cover the entire period, which is paid in advance by the original vendor.”

They finished: “At NCQ, leaseholders have begun to lodge the claims on their policies, but as yet the NHBC have not accepted that there is a problem with the ACM cladding – that position is being robustly challenged and may well require legal proceedings to force the NHBC to honour their insurance obligations.”

NHBC spokesperson: “We understand that the situation at New Capital Quay is very concerning for residents and we are committed to making an assessment of their claim as swiftly as possible once we have the necessary information.

"We have set up a dedicated website for residents to keep them up to date with our communications with PMML and our claims process.

“The residents’ claim was made on their behalf by management company PMML (a subsidiary of Galliard Homes, the builders of New Capital Quay). PMML is legally responsible for the on-going safety of the buildings at New Capital Quay.

“So that we can make an assessment of the claim, we have asked PMML to demonstrate to us how the buildings did not comply with the Building Regulations in force at the time of construction.

“Unfortunately, PMML has declined to provide this information and has not responded to our requests to meet with them.  We have also offered to pay towards the costs of obtaining this information and have not received a response to this offer.

“Since PMML has not provided the information we have requested, we will now step in to commission an independent expert to help us progress the claim as swiftly as possible for the residents.”