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Aneeta Varma and Richard Illingworth |
Traders threaten to challenge £70m property deal in court
Critics claim prices were inflated by Town Hall offer of portfolio to developers
AN unprecedented last-minute legal challenge could be made in the High Court amid claims that council-owned properties being sold to a developer for £70 million have been hugely overvalued.
Islington Council Lib Dem leader Councillor James Kempton has warned that the challenge could delay sales to at least 131 leaseholders who want to buy their properties. Lawyers representing small traders have indicated they may have a case under Human Rights legislation because of the “inconsistency” of the valuation process.
Some 220 small traders are being given the opportunity to buy their properties from the council or face the possibility of enormous rent rises. But it is being claimed that, had the properties been valued individually by an independent high street valuer – rather than as one large group – they may have been a lot more affordable for existing tenants.
Many traders desperate to buy properties that house their businesses – and often their homes – are struggling to afford the inflated prices asked for by the council.
Last week, the council’s overview committee gave final approval for the sale of the property portfolio to Islington developer David Pearl.
Mr Pearl, with an office at Angel, has offered to speak to any of the traders “any place, any time”.
However, some traders, faced with taking out enormous mortgages late in life if they want to safeguard their premises, are considering a last-minute legal challenge.
A live blues and jazz benefit to help pay legal fees is being held on Sunday at Filthy McNasty’s in Amwell Street.
Deputy Labour opposition leader Councillor Richard Greening has condemned the way the sale has been handled.
He said: “Had the council sold the properties individually, rather than in a portfolio, they would have been a lot cheaper. But, of course, the council would have got less money.
“Developers will pay more money under this process because they presumably hope to redevelop.”
Cllr Greening, who attempted unsuccessfully to have the sale reviewed at last Tuesday night’s council committee meeting, has requested but been refused details of the winning bid and the one that came second.
It is believed the second bid, at £65 million, was only £5 million less than the winning bid.
Cllr Greening said: “I want to see how the price was arrived at and to what extent there was consistency in the process. A number of properties, for example in Amwell Street and Upper Street, have been valued at a fixed rate of about £600,000 but they are all quite different.”
Cllr Kempton said sales of council property were clear and open to public scrutiny.
“We have someone who is prepared to offer a price for these properties but the traders are being given the first option to buy,” he said.
“We can’t sell it at a lower price when we have an offer. Council taxpayers would be up in arms if we did that.
“We’ve got 131 leaseholders who want to buy their properties and I suggest that any delay – as a result of possible legal challenges – is going to be quite unpopular.”
‘We’ll have to sell our home’
WHEN two textile designers were told they would have to pay £420,000 to Islington Council to buy their four-room design studio off Essex Road they immediately went to an independent valuer, writes Peter Gruner.
It was no surprise to Aneeta Varma and Richard Illingworth that the valuation expert, after thoroughly surveying the property, suggested it was worth £205,000, half the council estimate.
“It is totally unfair,” said Aneeta. “But if we want our workshop we have to pay the council’s price of £420,000. It’s a matter of like it or lump it.”
Aneeta admitted she couldn’t understand how the council reached its figure.
She added: “The high street valuer came, gave a thorough survey and estimated what we think was a realistic price.
“The problem is that mortgage companies won’t give you money unless they are certain it is safe. I don’t know what we are going to do. We’ll probably have to sell our home to pay for the business.”
Another trader, Zaffar Moughghal, has run a small store and Indian restaurant in Central Street, Finsbury, for 18 years. The council is asking £470,000 for the two properties – twice as high as his independent valuation.
“The estimates we were originally given have all gone up between 10 and 50 per cent,” he added.
Vet Dale Barter, who has led the traders in their negotiations with the council, is being asked for £577,500 for his property in Amwell Street, Clerkenwell.
“I have to meet the price because I can’t allow my business to be compromised any more,” he said.
“I don’t want another landlord like Islington Council.” |
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