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Leaseholders to pay after losing £3m cladding replacement row

27 July 2018 | By Neil Gerrard

The leaseholders of two Manchester blocks of flats will have to foot the bill for the £3m cost of replacing “Grenfell-style” cladding after losing their case at a tribunal.

Lendlease was the original developer for Cypress Place and Vallea Court in the Green Quarter. The 345 flats were designed and built by Shepherd Construction and were completed in 2013, before Lendlease sold the freehold to investment firm Pemberstone in 2015.

But a 2017 test revealed aluminium composite cladding (ACM) with unmodified polyethylene filler (category 3) on the buildings. Work to replace the panels is due to start in spring 2019.

Pemberstone took the matter of who should pay to replace the ACM panels to a tribunal, asking for an independent determination. Lendlease was not involved in the tribunal proceedings.

Meanwhile, leaseholders had hoped that either Pemberstone or Lendlease would foot the bill.

They highlighted the recent example of Barratt Developments, which decided to pay the estimated £2m cost of recladding the Citiscape development in Croydon, despite a ruling that residents should pay.

Residents also to pay for fire patrols

Now the tribunal has ruled that the apartment owners should pay for the cladding plus Pemberstone’s legal fees. It also ruled that the owners of flats in Vallea Court should pay for fire patrols until the building was made safe.

A spokesman for Pemberstone said: “The tribunal is an independent forum to which landlords and leaseholders can apply to establish clarity on issues of this type. It is particularly appropriate for large schemes like this where there are 345 apartments, of which 75% are owned by investors and some of whom are located overseas. 

“Now that the tribunal decision has been issued, this should allow us to establish a clear way forward.

“We do appreciate the concerns of the owners, particularly the minority who live in their own apartments. We will consider carefully and sympathetically how any payments can be structured to spread the cost over time. 

“The safety of residents has always been paramount and our property managers Livingcity continue to liaise closely with Greater Manchester Fire and Rescue Service.  Some work has already been undertaken to remove some cladding located around the car park at the lower storeys of the buildings.

“Our professional team have continued to work to develop a specification for the removal of the remainder of the cladding and its replacement and expect to be in a position to put this out to tender in the next few weeks so that work can start as soon as possible.  This is a complex project and as with many other similarly affected buildings elsewhere in Manchester and across the country its design and specification has been extremely time consuming.

“Pemberstone was not involved with the design or construction of the buildings and became the landlord in relation to the apartment owners in 2015.” 

Construction Manager has contacted Lendlease and a representative of the leaseholders for comment.

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