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Scandal of unsafe towers: CN investigates re-cladding delays

Residents have been left in fear and confusion by the slow pace of re-cladding private blocks deemed unsafe. Jack Simpson examines the factors behind the delays and what the future holds for these works.

“Whenever you hear a smoke alarm going off, you think: is that it now?”

Fran Reddington lives in Cypress Place, a residential block just north of Manchester city centre.

In January, 345 leaseholders at Cypress Place and the neighbouring Vallea Court were informed the buildings were wrapped in combustible ACM cladding that needed to be removed.

“I never thought about fire before, I just brushed it off. But you can’t now; it is constantly there at the back of your mind,” she tells Construction News. One leaseholder has stopped his grandchildren from visiting his flat due to the ACM, she adds.

Developer Lendlease completed Cypress Place and Vallea Court in 2013, before selling the freehold to property investor Pemberstone in 2015.

A property tribunal launched by Pemberstone ruled that leaseholders were liable for all re-cladding costs and the investor’s legal costs.

Lendlease has so far rejected calls to contribute towards the re-cladding bills.

“It’s a living nightmare for us all,” Ms Reddington says.

The situation worsened at the end of August, when inspections found more materials on the building’s facade that could require replacement.

CREDIT Google_Vallea Court Cypress Place Manchester

CREDIT Google_Vallea Court Cypress Place Manchester

Source: Google

Cypress Place / Vallea Court in Manchester

For the leaseholders already facing re-cladding bills of more than £10,000 each, this could mean additional costs and further delays to the removal.

Vallea Court and Cypress Place are just two of 293 private blocks in the UK clad with ACM cladding that the government says must come down.

Ministers have repeatedly vowed to keep residents safe and to hold building owners who fail to act to account.

But 15 months on from the Grenfell Tower tragedy, the owners of nearly 200 of these blocks have yet to inform the government of plans to remove the cladding.

Thousands of leaseholders in buildings deemed unsafe by the authorities continue to live in fear, with no indication of when the situation will be resolved.

Complex situations

One factor behind the slow response is the complex ownership structures in these private residential high-rises.

Oxford University professor of land law Susan Bright says these convoluted arrangements have created disputes over liability, with those involved often unwilling to take responsibility for the cladding due to high costs.

In any one block, there are typically at least four different interested parties involved:

  • The original developer, responsible for a block’s construction.
  • The building’s current owner, which bought the freehold from the original developer and is now responsible for the block’s safety.
  • The property manager, which manages the block on the owner’s behalf and is usually in charge of organising re-cladding work.
  • The insurance company – organisations such as the National Housebuilding Council (NHBC) that provide policies to cover defects or breaches of Building Regulations discovered in the blocks.

At the bottom of this tree are the leaseholders, who were not involved in the construction and do not own the building, yet can face huge bills to replace cladding.

A recent investigation by the Telegraph estimated around 20,000 properties could be affected.

As the high costs have become apparent to these parties – Taylor Wimpey, for example, has set aside £30m, and pledged to replace ACM on its blocks – disputes over who is liable have been prioritised over plans to replace cladding.

In November last year, ACM was found at the New Festival Quarter development in Poplar. Since then, occupants have been kept in the dark over exactly when works might take place.

Resident Kathy Schroeder tells CN: “Until the answer of who pays gets specified and nailed down then there is still going to be some ambiguity [over the] timeline – we have to wait for that to become clear.”

The NHBC, with which there is a 10-year warranty on the New Festival Quarter, is carrying out an investigation to see if Building Regulations were breached, and whether it is liable for any of the estimated £2m re-cladding costs.

All parties, including the leaseholders, are awaiting the findings.

“I never thought about fire before, I just brushed it off. But you can’t now; it is constantly there at the back of your mind”

Fran Reddington, Cypress Place resident

If the NHBC decides the use of ACM did not breach Building Regulations, then leaseholders could be facing five-figure bills and further delays to work.

New Festival Quarter developer Bellway believes it was built in line with the Building Regulations of the time, but tells CN it will rectify the situation if proven wrong.

However, it admits this work could still take some time, and could not say when work would start, leaving residents in limbo.

In the meantime, the developer has paid for heat detectors and alarms as a “gesture of goodwill” and paid for design consultants to prepare for the re-cladding.

But Ms Schroeder says the last estimate residents received from Tenos, the fire consultancy employed by the property manager, was that work could take two years.

She says the lack of clarity over a timeline and cost is extremely stressful for residents.

And the case of New Festival Quarter is mirrored across the country as disputes over who will pay to replace combustible cladding continue.

Waking watch

While such cladding remains on these buildings, measures have been put in place to ensure the safety of residents.

Leaseholders have become used to seeing 24/7 fire patrols, also known as waking watches, walking their corridors ready to raise the alarm.

The post-Grenfell decision by the National Fire Chiefs Council (NFCC) to change its evacuation advice in blocks with ACM (from stay put to simultaneous evacuation) has given rise to the new waking watch industry.

At Mace’s Greenwich Square project, a waking watch is carried out by construction security firm Bridge Group UK. Marpol Security, which also works for Salford Shopping Centre, has wardens stationed at several blocks in the North-west.

CREDIT Make Architects_Greenwich Square

CREDIT Make Architects_Greenwich Square

Source: Make Architects

Mace’s Greenwich Square development

Debt Collection and Bailiffs, the company which features on Channel 5 show Can’t Pay? We’ll Take it Away, is carrying out waking watch services on a block in Portsmouth.

But these services come at a cost.

In some cases, companies have agreed to foot the bill – Mace is currently paying £100,000 a month for its waking watch at Greenwich.

In the main though, these costs have fallen onto residents.

CN has spoken to several leaseholders hit by waking watch charges, including at Babbage Point in Greenwich, where leaseholders say they have been hit with a £1,455 bill by developers.

At New Festival Quarter, residents are potentially facing a waking watch bill above £500,000. Freeholder Adriatic and management company Pinnacle have given residents a bridging loan to cover the costs.

An alternative to a waking watch is installing a building-wide alarm system, with residents at Victoria Wharf paying £35,000 for one in their block.

The NFCC is clear in its guidance that a waking watch should be a temporary solution. But the longer cladding remains, the more permanent these watches appear.

There are also questions around the conduct and training of some waking watch personnel. CN has heard reports of staff sleeping on the job and others congregating to watch World Cup matches.

CN was contacted in confidence by those at one south London block where residents have taken over waking watch duties due to issues with the existing company.

The need for anonymity was driven by fears of arson as well as publicity adversely affecting property values.

The NFCC’s advice is that all waking watch staff should be given general health and safety training and specific training to support safe systems of work.

But independent fire and emergency planning consultant Stephen Mackenzie says the training of these waking watch staff is “very questionable”, and that more scrutiny is needed.

“Waking watch has never been empirically proven, it has never been stress-tested under real-world conditions,” he adds.

Government lacking teeth

At the end of June, government figures said the number of private blocks identified as having combustible cladding had hit nearly 300. Theresa May addressed the situation at Prime Minister’s Questions.

“Others must do the right thing, and if they don’t we are not ruling anything out,” she said in an implicit threat to developers and building owners to take action.

Yet work has barely gathered pace. The number of residential blocks fully re-clad has gone from four to nine, and the number of blocks with remediation plans is now 93, up from 71 in June.

In the public sector, a £400m central government re-cladding fund has helped local authorities and housing associations to accelerate work. Replacements have now begun on three-quarters of the social housing blocks identified.

On private blocks, the government has less influence.

“The government has not got very effective powers to compel people to do things. What is the government’s power in the current situation apart from persuasion?”

Susan Bright, Oxford University

“The government has not got very effective powers to compel people to do things,” Prof Bright says. “What is the government’s power in the current situation apart from persuasion?”

This month housing secretary James Brokenshire said private developers and owners could be hit with fines or banned from future government schemes if they do not remove dangerous cladding.

So far, out of the 293 blocks listed as having ACM cladding, only four developers and one housing association have publicly agreed to foot re-cladding bills.

Alongside Taylor Wimpey, these are Mace on the Greenwich Square project, Legal & General in Hounslow, Barratt Developments at Citiscape and Peabody Housing Trust.

Prof Bright believes it is no coincidence that those that have agreed to cover the costs are bigger developers.

“The government probably has more levers [with large developers] than they have with others, because they are going to have new developments in the pipeline and they are going to want to be in the government’s good books,” she says.

Developers’ responsibility?

Residents are also lobbying developers to help them with re-cladding bills.

Many leaseholders argue that developers that oversaw building construction and cladding installation have a moral duty to cover the work.

At the NV Buildings, a 246-home block in Salford Quays, residents are campaigning to get original developer Countryside Properties to carry out and pay for the works.

The development was constructed under a design-and-build contract for Countryside by the collapsed contractor Carillion in 2004.

With the site no longer covered by the 10-year NHBC insurance policy, residents face huge costs if Countryside does not step in.

NV resident Peter Brown tells CN: “We have 246 leaseholders who through no fault of their own are stuck in the middle with no one taking responsibility. The onus has to be on Countryside to do the right thing.”

CREDIT Chris McAndrew James Brokenshire housing secretary

CREDIT Chris McAndrew James Brokenshire housing secretary

Source: Chris McAndrew

Housing minister James Brokenshire has warned firms they face fines or bans if they fail to remove combustible cladding

The NV Buildings’ tripartite lease arrangement means leaseholders will also have to organise and manage the works too.

Mr Brown says: “If Countryside doesn’t step in, the leaseholder management company which is owned and run by leaseholders will be left with the enormous challenge of specifying the remedial works, tendering, selecting and managing the works.”

Countryside told CN it secured all necessary approvals at the time of the construction, adding that it took the residents’ concerns seriously and had launched an investigation into the building’s design and build.

At Cypress Place and Vallea Court, residents face a £3m bill to replace the cladding if their calls for Lendlease to step in fall on deaf ears.

“We have 246 leaseholders who through no fault of their own are stuck in the middle with no one taking responsibility. The onus has to be on Countryside to do the right thing”

Peter Brown, NV Buildings resident

Tendering for a contractor to carry out the work has begun, with leaseholders expecting to receive their bills for the work before Christmas.

Ms Reddington argues Lendlease “should do the right thing” given its focus on sustainability and global operations.

Residents have called for the company to be barred from bidding for the £190m Manchester Town Hall contract until the re-cladding is paid for.

As part of his announcement this week, Mr Brokenshire named Lendlease as one of the companies that needed to “do the right thing” or face government sanctions.

In a statement given to CN before the housing secretary’s announcement, a Lendlease spokesman said the company “recognises the concerns of residents with regards to the use of decorative cladding in the Green Quarter”.

He said it was a “complex” issue, pointing to the multiple parties involved, including design-and-build contractor Shepherd Construction and the current owner of the buildings, Pemberstone.

In a response to Lendlease’s comments on Vallea Court and Cypress Place, a Shepherd Construction spokeswoman told CN: “We stress that Shepherd Construction takes its contractual and statutory responsibilities seriously and the safety of residents is our primary concern.

“We are investigating the concerns which have recently been notified to us. At this time, we have nothing further to add to previous commentary other than we built to the design specified by the appointed architects.”

Contractors’ role

The role of contractors could become a more common feature of discussions over re-cladding liability during the coming months.

In July, the NHBC agreed to cover the estimated £25m-£40m bill to re-clad the 1,000-home New Capital Quay development, after investigations suggested the construction failed to comply with Building Regulations.

Buildings like New Capital Quay still covered by warranties could see insurance providers paying out millions. For others, this would open up further disputes over who is liable for re-cladding.

Anjon Malik, head of construction at law firm Gordons, says such disputes are likely to pit developers against contractors. “Developers will be looking at main contractors, who in turn will be looking at their cladding subcontractors,” he says. “But will these subcontractors still be able to afford the necessary insurance?”

Fire consultant Mr Mackenzie agrees that “blame games” are likely, with contractors increasingly embroiled. “Liability will try to be pushed onto the contractor, the contractor will push onto the cladding supplier, the cladding supplier will put onto the building specifier, they will put it onto the tender documents, the tender documents will put it onto the design team,” he says.

Individuals who installed the cladding may even be dragged into the disputes, he adds.

Prof Bright believes all of this could lead to years of litigation, holding up the replacement of cladding even further.

Even in cases where a re-cladding plan has been agreed and a developer has pledged to foot the bill, residents are not out of the woods yet.

CREDIT Ian Roberts_NV Buildings Salford Manchester

CREDIT Ian Roberts_NV Buildings Salford Manchester

Source: Ian Roberts

NV Buildings in Salford, Manchester

Barratt Developments agreed to pay the estimated £2m to remove cladding from the 93-home Citiscape tower block in Croydon. The move was hailed by the then communities secretary Sajid Javid, who said other developers should follow Barratt’s example.

With the funding in place, the building’s property manager FirstPort specified the work and a tender was put out for a contractor to take on the work. However, this had to be paused after the government announced its review of Approved Document B.

A FirstPort spokesman tells CN it is still waiting on “absolute clarity” from the government on what materials can be used for the re-cladding. The company has drawn up a specification it believes would comply with government changes, but will not start work until that is confirmed.

“When we replace the cladding at Citiscape, it’s vital that we provide a long-term solution,” the company says.

A spokesperson for the Ministry of Housing, Communities and Local Government said: “Nothing is more important than ensuring people are safe in their homes, which is why we have issued clear guidance to building owners about re-cladding buildings.”

The MHCLG said it had published a guidance note in December to support building owners through re-cladding work.

Its current advice states that the best way of ensuring external wall systems resists fire spread is to use materials with limited combustibility, or use an external wall system that has passed large-scale fire tests set out in current Building Regulations guidance.

For other blocks, the replacement of ACM has uncovered additional problems.

Residents at Vallea Court last month received a letter saying that additional work may be required, including adjustments to insulation and cavity barriers. Surveyors also found Trespa panels which may have breached Building Regulations and might need to come down.

Alternative solutions

Like many residents caught up in the private cladding chaos, Victoria Wharf resident Lucy Hopkins is waiting on clear action from the government.

“We don’t really know what to do; do we really push for re-cladding and then have to pay for it, or do we wait for the government to come in with new guidance that forces freeholders to act?” she says.

Government measures have yet to accelerate the action required of building owners, prompting other suggestions on how to speed up work.

Speaking at a Westminster cladding forum in July, Labour’s shadow minister for housing Sarah Jones said: “We should make the blocks as safe as possible and then work out who pays; it seems the best way to do that is provide loans to get the work done.”

She said the alternative was “years of fights” preventing work from taking place.

Association of Residential Managing Agents chief executive Nigel Glen believes the government’s re-cladding programme on social high-rises should be extended to private blocks.

“The threat is completely real for any building [with this cladding]. Why do we have to wait for another disaster to happen before the government properly listens to our situation?”

Anuj Vats, Citiscape resident

“Our concern is that while lengthy and costly legal battles are being fought out, the safety of over 5,700 leaseholder families living in private high-rise blocks is at risk,” he says. “I believe that government should step in and take all properties into its own re-cladding programme.”

Another option is bringing in legislation to force building owners to act. In July a petition was launched calling on the housing minister to force developers and freeholders to remove cladding. At the time of writing, the petition has 113,000 signatures.

As government ponders its next moves, there are fears that the number of blocks with combustible cladding could be higher than the government’s official figures.

Speaking last month, Royal Institution of Chartered Surveyors director Gary Strong said the body had heard from high-rise owners who were trying to hide the presence of ACM from authorities, due to the costs of being ordered to remove it.

Mr Strong said the real number of private blocks with combustible cladding could be nearer 600.

Some also believe that ACM cladding could represent merely the tip of the iceberg, and that there could be many more developments with other combustible materials.

The NV Buildings in Salford contain no ACM at all. Instead, the blocks contain EPF, a form of insulation that has been deemed dangerous and in need of removal.

“A lot of the discussion you hear from the government is about ACM, [but] I think there is an issue of buildings that have non-ACM but still have combustible material caught up in the scandal which is not being directly assessed,” NV resident Mr Brown says.

“I’ve not seen any data on other buildings with cladding problems that are not ACM.”

What next?

The complex and varied situations in most high-rise blocks mean it is hard to come up with a catch-all solution.

But as the petition shows, many think the government needs to do more to support leaseholders in these blocks.

A letter sent to the government by the Equality and Human Rights Commission said the continued use of combustible cladding and the failure to remove it from private blocks breached the government’s fundamental obligations to protect citizens’ safety.

As Citiscape, where FirstPort is waiting on government clarity, resident Anuj Vats illustrates why swift decisions are needed.

In June, smoke was reported at the development. Three fire engines arrived and 50 residents were evacuated. Mr Vats tells CN the panic was heightened by the knowledge that Citiscape is clad in ACM.

“The threat is completely real for any building [with this cladding],” he says. “Why do we have to wait for another disaster to happen before the government properly listens to our situation?”

Absent freeholders

In other blocks, residents say their pleas for action are not being heard.

Lucy Hopkins, a resident of Victoria Wharf in London’s Bethnal Green, says repeated attempts to contact her freeholder for clarity on plans have yet to receive a response.

Residents at the 80-flat Victoria Wharf development first found out their building had ACM cladding when a 24/7 waking watch patrol appeared at the block.

The patrols have been employed on hundreds of blocks since Grenfell under instruction by the fire service as an additional safety measure.

Victoria Wharf residents have already paid £244,000 for the waking watch service and a further £35,000 to install a new fire alarm system.

But despite the growing costs, leaseholders are yet to hear plans for re-cladding the block. “There is no plan for re-cladding, there is no plan at all in place for that, and we are uncertain about what we should be doing,” Ms Hopkins says.

Victoria Wharf was developed by Columbia Group in 2007, a group that listed a David Kennedy as a director. Since then the freehold has changed hands a number of times between different companies that also list Mr Kennedy as a director, including its latest freeholder, Kedai.

Residents were informed three months ago that the freehold is due to be sold again but have not yet been told who the new owner will be.

“It is almost impossible for us to get in contact with the freeholder,” Ms Hopkins says. Instead the residents are forced to contact the building’s management company, which Ms Hopkins claims also struggles to contact the freeholder.

MP Sir Peter Bottomley raised the issue of absent freeholders in a parliamentary debate on cladding in March. “The managing agents should make sure they declare who these people [freeholders] are,” he said. “Let us have them in front of select committees talking about who they are and how they will respond to this issue.”

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