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The Queen, her tenants and the money men who want them out
Jonathan Prynn and Mira Bar-Hillel21 Sep 2010
It was one of the West End's glossiest nights of glamour. Late into the warm September evening, Regent Street's pavements teemed with shoppers, with stores such as Liberty and Jaeger staying open until 11pm.
For the Crown Estate, owner of Regent Street for almost two centuries, a recent celebrity-garlanded opening — the Vogue-sponsored Fashion's Night Out — was another triumph, showing the newly polished jewel at the centre of the monarchy's £6 billion property portfolio at its best. But for residents of 1,400 affordable homes across the capital that are also part of the Crown Estate, it was typical of the ancient property owner's starry-eyed obsession with its glitzy West End developments.
Just two days earlier, the Crown Estate board announced plans to sell the homes — in north, south, east and central London — for £250 million in what is being seen as a gross “betrayal” by London's second biggest landlord after the Duke of Westminster.
The flats and houses are built on royal land owned by the crown since Henry VIII's reign and are rented predominantly by key workers such as nurses and teachers.
Many residents have lived on the estates all their lives and for them the decision to sell is a rejection by a landlord they assumed had a benevolent and long-term, almost feudal, interest in their welfare.
Although George III gave up day-to-day control of the Crown Estate in 1760 in return for a civil list income, the Queen is still technically the “landlady” and many tenants treasure the royal connection.
Ben Bowling, chair of the residents' association for the Millbank Estate, says: “Most people understand themselves to be tenants of the Queen. Particularly among the older residents, there is an idea that there is something special about being Crown tenants, it is almost an honour. So it has come as a terrible shock to learn that their tenancy agreement was something transient that could be bought and sold. People feel terribly betrayed.”
The housing is spread over four separate estates in London, the biggest and oldest one is next to Victoria Park in the borough of Tower Hamlets, with smaller ones in Millbank, Camden and Lewisham.
Commercially, the decision to sell makes perfect sense. The affordable homes generate just £3 million profit, an annual return of little more than one per cent.
If the £250 million the Crown Estate expects to realise from the sale were invested in highly profitable West End developments or retail parks, the potential returns are many times higher.
In addition, it says it is legally bound to maximise the investment returns from its eclectic portfolio, which made £211 million profit last year (under its “Going for Gold” strategy, it hopes to boost this to £250 million). The Crown Estate also encompasses the Windsor Estate, the seabed out to 12 miles, around half the foreshore between low and high tide, commercial property and farmland.
So despite a long and well organised campaign of opposition since the sale was first mooted in January — including a poll of residents that found more than 1,500 opposed the sale and only two were in favour — a buyer has been found. The identity of this buyer will not be disclosed for another three weeks, merely adding to the ill-feeling of tenants who, despite assurances to the contrary, fear a new commercial owner will push up rents, weaken tenants' rights and sell off homes as they fall vacant, eventually leading to the break-up of the estates.
Madeleine Davies, of the Victoria Park Residents' Association, says: “We've already seen rents go up massively for new tenants and the rent for existing tenants is being put up as high as it can be. Now we face an uncertain future with goodness knows who.”
Dr Bowling, an academic who has lived with his teacher wife on the estate for 25 years, says the consultation was universally regarded as a token “box- ticking” exercise.
“We asked for a role in selecting the new landlord or at least in the selection criteria but essentially we've been excluded from the process. We all feel very powerless.
“Now, finally, we've got to wait another three weeks to find out who it is and many of the older residents are very anxious about what is going to happen to their homes.”
The estates represent one of the biggest pools of affordable housing in a city where house prices have risen more than 100-fold since the Queen ascended the throne in 1952. Rents are set at between 40 and 60 per cent of market levels and, until recently, the Crown Estate was regarded as a model social housing proprietor.
Lesley Gilbert, a clinic manager at University College Hospital, says: “Experienced key workers keep London's heart beating but we need a place to live in at affordable rents.”
Tube driver Brian Munro says: “It's astonishing that the Crown Estate is treating key worker tenants in central London in this way. The whole community is opposed to this sell-off.”
In recent years, according to some tenants, the Crown Estate has become more commercial, more aggressive. A threatening letter earlier this year raised hackles by warning Victoria Park residents that if they left anything in communal areas they would be considered in breach of tenancy. There was also ill-feeling over a decision this summer to install “live-in” security guards at a nearby flat after it was cleared of squatters by police.
Blame for the Crown Estate's “betrayal” is put squarely at the door of its “technocrat” leadership, headed by chairman and former John Lewis boss Sir Stuart Hampson and its chief executive Roger Birch.
Special opprobrium is reserved for the £225,000-a year-director of investment and asset management, Paul Clark, who previously worked for the Church Commissioners and was responsible for selling its portfolio of social housing in 2005. Some tenants suspect that bonuses for senior management linked to the Crown Estate's financial performance are driving the decision to sell the affordable housing portfolio.
At a Treasury Select Committee hearing in March — profits from the estate go to the Treasury — the board said the residential homes were “non-core” and better off in the hands of a specialist housing company. It insisted that it would do its utmost to find a suitable new owner that would honour the rights of tenants.
But none of the reassurances have convinced tenants, or indeed Boris Johnson. The Mayor is said to be furious about the potential loss of such a large and valuable stock of social housing. He is also concerned that the new owner will raise rents year-on-year at the maximum allowable rate of nine per cent to boost profits.
Many residents believe the Queen herself is personally sympathetic to their campaign. One cited the fact that they were allowed to deliver a petition to the front door of Buckingham Palace itself in March. A palace footman told one member of the delegation that only petitions for causes in which the Queen took a personal interest are accorded that honour.
The history of the Crown's involvement in affordable housing can be traced back to 1840, when Queen Victoria received a petition from the people of Bethnal Green for a royal park.
An Act of Parliament in 1842 authorised the Commissioner of Woods and Forests to buy land to develop Victoria Park and homes around it to be let at “affordable rents” for tradesmen and working people.
Three other estates providing affordable rented homes to local artisans and tradesmen were then created at Millbank, Cumberland Market in Camden and Lee Green in Lewisham.
But short of direct government action, it now seems inevitable that the off-loading of the homes will be completed at some point over the winter.
Although the Queen has no personal involvement in the running of the Crown Estate, some tenants find it hard not to hold her responsible.
As one elderly resident put it: “I've collected books about the royal family all my life. Now I just feel like tearing them all up.”
Reader views (14)
I also want to point out to people who think tenants are somehow “subsidised” how mistaken they are. Everyone pays taxes, including tenants who are key workers. They don’t get great wages and contribute essential service to the public. If they have to get some rent benefit to afford “affordable” rents (from taxpayer funds) this goes to the CEC before some is paid to the queen & treasury.
Have you seen the salaries, pensions and bonuses paid to executives? It is taxpayers who really subsidise the CEC on these wages. – Check the link here:
http://www.thecrownestate.co.uk/_ext/ar/2009/governance/remuneration.html
The Crown Estate portfolio has been expanding too much for the good of the UK . The Guardian reported that it is sitting on land that energy companies wish to develop for energy sustainability and yet they call themselves "Environmental Stewards". They drive up London rents and are ultimately are dangerous to our economy. They don't do any of the things they say.
They are parasites.
The monarchy and treasury should intervene and donate the estates to the local councils for more reasonable rents.
If I had been stupid enough to collect monarchy literature I wouldn’ just tear it up I would defacate on it.
- Anita, London NW1 UK, 25/09/2010 13:47
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(cont. from below)
ONE VULNERABLE TENANT LOST TWO MONTHS RENT. SHE WAS NOT REPAID THE STOLEN RENT FOR AN EXCESSIVELY LONG TIME, OVER ONE YEAR. ADDED TO THAT INJUSTICE, SHE WAS UNABLE TO BID FOR ANOTHER PROPERTY FOR ESSENTIAL FAMILY SPACE. WHY? BECAUSE SHE WAS IN RENT AREARS – CAUSED BY THE CORPORATION
No one can make valid complaints about any of the management or they will accuse the complainee of harrasing them.
If you have a shorthold tenancy you can be evicted at the end of the agreement term, no reason is legally necessary. This particular manager did such a good job tricking and deceiving tenants into lowering their tenancy security status for the corporation, preparing the way for rent increases?, they did not listen to complaints about manipulative and bully tactics.
The bonus system and corporate objectives to add commercial interest positively encourage dishonourable ruthlessness throughout the corporation.
In assured tenancies rents are allowed to be increased a max 9% pa. (For regulated, its biannual) This percentage of increase compounds the amount year on year. Pension savings interest cannot meet such increase for retired tenants
continued in the next post above...
- Wisdom-sharer, London NW1 UK, 25/09/2010 13:36
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Does "kerry livermore" work for the CE?
My rent is now 836p/m -I'm a single parent and do two jobs. I originally paid £583 in 2004.
I don't care if other protected tenants pay less, at least they are using their skills and time to make a case for people like me.
KL, no CE tenant is allowed to rent if they own/are buying other property... And Don't worry! the CE employ estate managers who operate so cunningly to track any irregular tenant activity, they even manage to keep their own fraudulent activity quiet. Check this link: http://www.24dash.com/news/Housing/2008-02-14-Bingo-mad-housing-chief-bullied-tenants-out-of-thousands A quote from this report says, "She would also take money for rent in cash and cover up this diversion of monies through false records…."On one occasion the Commissioners were taken to a tribunal by a tenant complaining about the defendant's behaviour. The CEC backed the defendant and they won.
"The effect of the proceedings on the relations between the Commissioners and the tenants was that they felt they had been bullied and let down by the Commissioners, because they were doing nothing about stopping what this lady was doing."
They allowed this fraud – senior managers denied complaints because it appeared to benefit their revenues – she earned her bonuses HOWEVER, THE CEC REMAINS COMPLETELY UNACCOUNTABLE TO TENANTS THAT SUFFERED HARRASMENT AND TO THE PUBLIC WHEN THE MANAGEMENT HAD TO REIMBURSE PEOPLE FOR THE LARGE AMMOUNT OF CASH
- Wisdom-sharer, London NW1 UK, 25/09/2010 13:30
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I cant afford to live elsewhere. That would make me bankrupt. Expect I'll lose my job then as well.
I know, how about paying me a living wage that allows me to afford my own home? All the shared ownerships are for couples or those with savings. I have nothing but debts, my Dad died intestate with nothing but debts.
Crown has given me a bit of hope. I've worked hard in London for over 22 years now, 4pm-midnight shift, not paid very much,receive no expenses (unlike the MPs at my workplace), dont have a car and I was turned down by the benefits people when I asked for help.
- Barbelo, Pimlico, London, 23/09/2010 10:56
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Kerry Livermore generalises about a group of people she clearly knows little about. On the Victoria Park Estate a large proportion of the tenants are elderly and retired and have lived in their homes for 40-60 years. They are generally on fixed incomes and cannot afford sharply increasing rents. Most of the tenants who have less than 30/40 years on the estate are key workers and unless you inhabit a different world I am sure you realise that the majority of nurses, teachers, ambulance drivers etc do not earn huge salaries and are certainly not likely to get wage increases that match some of the likely rent increases. Don't make the mistake of believing advertised 'superheads' salaries are what all teachers earn. I can't speak for Mr Bowling but personally my wife and I are retired and do not own a first home let alone a second!
To Del I would say don't judge tenants by cars parked nearby because in Victoria Park estate most cars are those of commuters off to nearby transport as the area is not designated as a CPZ!
What should be understood is that a city needs low rent housing for its vital key workers who everybody needs and for people who are not home owners but have given their working lives to the city while paying their taxes. Give us a break!
- Alan, London, 22/09/2010 16:08
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the cars parked outside the estate are not the cars of the broke
- del, london, 22/09/2010 13:26
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I don't see why the Queen should subsidise these tenants, especially when her income and expenditure comes in for so much comment and criticism. It's the government's or local authority's responsibility to provide affordable housing for people in need.
- Pam, London, UK, 22/09/2010 13:07
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The Ministry of the Treasury is not the only entity that the Crown Estate is accountable to. The whole planet already has a Landlord and his property is kindly on loan to the governments and institutions that defend such faith. (See Leviticus 25:23)
Re. the moral manipulations surrounding this sale - superlative laws often prove true and promise a final, conclusive fulfilment: “Do not be misled—you cannot mock the justice of God; for whatever a man is sowing, so shall he reap”, (Galatians 6:7).
I would like to point out how offensive it is that this organisation publishes the hollow ideal that the Corporation ‘treats people the way it would like to be treated itself‘’ for the purpose of creating a pseudo-beneficent public reputation.
This fake self-promotion is a ghastly plagiarism of a very fundamental social value - even of holy origin, and yet the CEC persistently denies any role as a Social Landlord - let alone an institute to redeem humanity.
Quintessentially, this stolen tenet makes a mockery of another divine law that is constitutional for any baptised Christian and defender of the faith to practice; “So in everything, do to others what you would have them do to you, for this sums up the Law...” (Matthew 7:12)
The Crown Estate simply uses plagiarised divine-instruction-employed-as-spin. This is the truth, do not be misled: It’s core values are: Hypocrisy, Greed and Contempt for ordinary people.
- Wisdom-sharer, London NW1 UK, 22/09/2010 04:35
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A very good article. But to say that the £3 million profit a year that the Crown Estate makes from this unique part of its portfolio is just 1% of the value of the estate is disingenuous. These 'properties' or maybe even 'homes' have existed since the first world war. Not everything boils down to a fast buck or speculation for profit. Sustainablity, real communities and public interest are more important. It is not in the public interest for the Crown Estate to sell off these homes and their communities to the highest bidder to subsidise their mishandling of their portfolio in the west end. Is it?
- Mr Brian Munro, London, 21/09/2010 21:53
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Disgraceful action by the Crown Estates.Greed seems to be the driving force. The bonus culture in action in all its glory. I hope the Queen can take action and replace the Boad of the Crown Estates.
- pb, blandford, 21/09/2010 18:26
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Kerry Livermore - You said exactly what I wanted to say. What tosh that Dr Bowling and his wife need to stay in subsidised housing. Bet their savings on the rent pays for their 13 weeks a year holiday abroad no doubt! Welcome to the real world. We all have landlords and have to pay the rent they demand.
- Maya, London, 21/09/2010 16:50
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What about following the French pattern and levying social housing rents based on income? I suspect that Kerry is right about some of the moaners....
- Anonymous pedant, Chiswick, 21/09/2010 15:55
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Is Tony Blair, the mysterious bidder?
- Volpone, Stoke Newington, London, 21/09/2010 14:04
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This is just special pleading from people who can well afford to live elsewhere but like having subsidised tenancies. 'Dr Bowling and his teacher wife' are probably paying about £100 per week for prime property, enough for two earners to also pay off the mortgage on a home in France.
- kerry livermore, London, England, 21/09/2010 13:59
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