LEASEHOLDERS of an Andover estate say they have been left feeling suicidal because their housing provider landlord is proposing to bill them up to £27,000 EACH to fund a £4.5m maintenance project.

At Christmas Kingsway Gardens residents received letters from Aster Group, their freeholder, detailing works to be carried out on Saxon, Stuart, York and Tudor Courts with estimates of charges per flat as much as £27,000 exclusive of VAT and a 15 per cent admin charge.

As Aster is set to give contractors the go-ahead to commence works within the coming weeks, they intend to begin deducting instalments from bank accounts in the new financial year.

For those who live in the properties there is the offer of a five-year payment plan but those who let their flats out have been told that money will be taken out in 12 monthly instalments.

The debt will also be registered as a charge against the property so that it cannot be sold without the money being paid to Aster.

Many property owners cannot afford the exorbitant costs and being unable to access the help of a loan or remortgage or to sell the property with these charges hanging over them, they have been left anxious and questioning whether they are going to lose their homes.

One Tudor Court resident who wishes to remain anonymous said: “I feel suicidal over this. I’m stuck between a rock and a hard place and I don’t know where to turn.”

As previously reported by the Advertiser, Aster presented leaseholders with initial proposals to charge each of them between £15,000 and £20,000 in December 2014 after carrying out a survey of works required on the flats to solve the problems of damp and mould caused by water ingress.

They were then issued with a Notice of Intention of proposed extensive works in March last year including redesigning and replacing the gutter system, concrete repairs and fairing coatings, balustrading to walkways and stairwells and replacement of windows and French windows.

Following a consultation period Aster then put the contract out to tender and, after accepting a quote from Stepnell Limited for £4,843,511.00, wrote to leaseholders with a revised estimate of proposed charges of up to £27,000.

Once a 15 per cent admin charge and VAT are added the bill will be in the region of £37,000 and those figures are only estimates, they could be increased.

During this paper’s enquiries, Aster has confirmed that the contract value is £3.4m and comes to £4.5m with the inclusion of VAT and the admin charge of over £500,000, a reduction from the original tender value.

In recent years, leaseholders have been paying between £800 and £1,100 per year in maintenance fees which also pay into a sinking fund that is supposed to cover the cost of works if the usual maintenance fees are not enough to cover them.

Although they do not dispute that works need doing, they say that the extent of the works is due to Aster’s historic neglect and questions have been raised about where their maintenance fees are going, what has happened to that sinking fund and whether all of the detailed works are necessary.

Since the initial correspondence from Aster and subsequent meetings with residents soon after, leaseholders have been trying to enter into negotiations with them by asking for copies of the survey and associated reports, objecting during the consultation process and requesting meetings but the housing company has failed to provide a satisfactory resolution.

New buyers who were unaware of the proposed works were promised one-toone meetings with Aster when the initial consultations took place but no such meetings have been forthcoming.

Stuart Court resident and leader of the first Kingsway Gardens leaseholders group, Gary Rayner, said: “It has taken two years to get to this position.

They have made every attempt to avoid negotiation with the residents and steam rolled this proposal through for their own purposes.”

During the initial consultations the work was to be carried out on Stuart, Saxon, York and Tudor Courts but now Atholl Court leaseholders have also been presented with proposed charges.

A second Aster Leaseholders Groups has now been set up on Facebook.

Andover town councillor Andy Fitchet is supporting leaseholders in their bid to find an affordable solution and also has first-hand experience of living with water ingress in a Kingsway Gardens flat.

He said: “As the freeholders, Aster are responsible for the structure of the building – it is the prolonged lack of maintenance and neglect of the structure that has caused this problem and it is Aster’s responsibility to fix it.

“Suggesting that residents pay up to £27,000 each to fix this issue is nothing short of astounding. Not only is that more than average earnings it is bullying and intimidation. I am disgusted that Aster are trying to force leaseholders to pay for an issue that is wholly their fault through their neglect of the building.”

Phil North, Alamein ward councillor for Test Valley Borough Council, is also supporting the residents and is attending a meeting with Aster next week to address some of their questions.

Cllr North said: “There are a lot of questions that Aster still need to answer concerning building surveys, maintenance, administration fees and the sinking fund.

“I will be following these up on behalf of residents when I meet the Aster regional director for Hampshire this coming week and will be accompanied by a representative from the leaseholders group.

“I feel for the leaseholders and they deserve answers before any payments are made.”

Some leaseholders have also been in contact with MP for North West Hampshire, Kit Malthouse, who said: “I am working with local councillors who are also engaged with trying to get to the bottom of this issue. To land leaseholders with such enormous bills seems highly irregular and we must find a way forward that is reasonable for everyone.”

It is understood that Aster have now written to residents confirming that the sinking fund stands at around £44,500 for Stuart and Tudor Courts - approximately £1,800 per property – but questions still remain as to how they came by this calculation.

Aster’s response

“We do appreciate that the costs involved are significant and we are working with residents on an individual basis to resolve any issues they may have with paying a proportion of the costs. The work is absolutely necessary to maintain the buildings in the long term and will ultimately mean less impact and lower costs to leaseholders in the future.

“We arranged for independent structural engineers to carry out extensive inspections and produce a specification to remedy original construction defects. We used this to invite tenders for the works and these are a reflection of the current market costs. We will be working with the contractor that has supplied us with the lowest cost estimate at £3.4 million and will contribute 20 per cent of the total costs, which relates to the flats we own.”

The Advertiser asked Aster questions about the situation: Why haven’t the leaseholders seen a copy of the original survey and the health and safety report relating to that?

We commissioned a structural engineers report and presented a summary, key findings and recommendations to residents in 2015. Full disclosure of the report would breach data protection laws as it includes details of individual residences. The cost of the report was covered by Aster Group.

What has happened to the sinking fund/how much is the sinking fund for Saxon, Stuart, Tudor, York and Atholl Courts?

Service charges pay for the delivery of day-to-day services such as maintenance of the grounds.

Some blocks have a sinking fund as well as a service charge, however this is not the case with all the blocks.

Unfortunately where sinking funds do exist they are not sufficient to complete the works required.

Leaseholders were consulted on the level of sinking fund contribution in 2006/07 and opted to collect sufficient monies to cover cyclical decoration only.

We have let leaseholders know individually what the balance on their sinking fund is and this will be used to reduce the sums payable by leaseholders where possible.

What is the 15 per cent administration charge for Aster on top of the £4.8 million for the project equating to somewhere in the region of £750,000?

The total cost of the works, exclusive of VAT and management fees, is £3.4 million. We will be responsible for a proportion of these costs relating to the flats owned by us.

The management fee covers the cost of our management of the programme of repairs.

This is a large programme of works and requires a significant amount of resource and expertise to ensure the programme is successfully delivered on time, to the right standard and according to the agreed terms with the appointed contractor.

The 15 per cent is in accordance with the industry standard.

We understand that the maintenance agreements state that residents should pay charges towards original repairs but that improvements are Aster’s responsibility. Some of the works outlined appear to fall into the improvements bracket, so why are leaseholders being charged for improvements?

At the request of residents we included improvement works as part of the tender, however, also at the request of leaseholders these were removed at the tender analysis stage and no longer form part of the planned works.

Some leaseholders may have incurred extra costs if improvement works were included.

This is why there is a difference between the tender sum of £4.8 million and the contract sum of £3.4 million.

So, what are people going to do?

We do understand that this is huge amount of money for a family and we will work with residents who are in financial hardship to resolve any issues.

We are able to offer a payment plan to those leaseholders unable to raise finance elsewhere and will consider each application on an individual basis, offering as much flexibility as we can.