Roof and airspace offer

[mc2fool]

I live in a collectively enfranchised self-managed block of flats, the freehold of which is held by a limited company of which all of the leaseholders are members and several are directors, including me. All of the directors have received the letter below (our names & addresses undoubtedly gotten from our Companies House entry) and are a little curious as to what precisely is being offered, what is going on, and where the gotchas might be.

Self-evidently the offer will be one that's of benefit to the people making it, and it's also self-evident that they haven't actually looked at our block of flats, not even on Google streetview, as the top floor of flats (there are six flats, two on each floor of the three storey block) is already in the roof (mansard with a flat roof atop), so there is no possibility of adding more flats on top ... at least not without totally removing the existing ones and extending the brick walls up another storey.

So, what do fellow Lemons make of this? The letter is from https://mscgroupltd.co.uk/ (bolding etc as in the original)

-----------------------------

Introduction to Freeholders - Airspace

Dear Director of the freehold management company,

I am contacting you regarding the roof and airspace, I believe there is potential to create additional dwellings at your premises.

In return for granting the rights to explore this, you could receive in excess of £50,000 each as a shareholder of the freehold (this is the average paid to date on our previous projects).

• In addition, I propose enhancing your block. Externally insulate and render the walls providing the block with a modern feel, refurbish the communal areas, ensure the block meets the latest fire safety standards, new security entrance systems, satellite/fibre upgrades and landscaping to mention a few.
• The creation of new dwellings provides you with a new roof which comes with a 20+ year warranty. It is proven such roof warranties increase apartment values.
• The creation of new dwellings reduces your service charge due to economies-of-scale. The new roof and upgrades proposed will reduce the annual remedial costs.
• We work with Modular contractors, the dwellings are constructed off-site, reducing disruption and offering greater quality control. They are typically installed in as little as 4 weeks.

With all the above the value of the existing dwellings should increase. A cleaner, safer and more aesthetically desirable building can add up to 10% to the value of a property.

I have completed several developments and recently finished two rooftop schemes which I can send you the particulars of, if interested. Our in-house architect and planner can have some high-level plans produced for you to consider in conjunction with the proposal.

I have sufficient funding originating from two facilities; one is an institutional funder with AUM in excess of£500m. The other is our family business, Mala Investments and group of companies. Established in 1980, their core business model is in the commercial property sector.

If you wish to discuss this opportunity further or have any questions, please get in touch via my direct contact details below.

[AsleepInYorkshire]

I live in a collectively enfranchised self-managed block of flats, the freehold of which is held by a limited company of which all of the leaseholders are members and several are directors, including me. All of the directors have received the letter below (our names & addresses undoubtedly gotten from our Companies House entry) and are a little curious as to what precisely is being offered, what is going on, and where the gotchas might be.

Self-evidently the offer will be one that's of benefit to the people making it, and it's also self-evident that they haven't actually looked at our block of flats, not even on Google streetview, as the top floor of flats (there are six flats, two on each floor of the three storey block) is already in the roof (mansard with a flat roof atop), so there is no possibility of adding more flats on top ... at least not without totally removing the existing ones and extending the brick walls up another storey.

So, what do fellow Lemons make of this? The letter is from https://mscgroupltd.co.uk/ (bolding etc as in the original)

-----------------------------

Introduction to Freeholders - Airspace

Dear Director of the freehold management company,

I am contacting you regarding the roof and airspace, I believe there is potential to create additional dwellings at your premises.

In return for granting the rights to explore this, you could receive in excess of £50,000 each as a shareholder of the freehold (this is the average paid to date on our previous projects).

• In addition, I propose enhancing your block. Externally insulate and render the walls providing the block with a modern feel, refurbish the communal areas, ensure the block meets the latest fire safety standards, new security entrance systems, satellite/fibre upgrades and landscaping to mention a few.
• The creation of new dwellings provides you with a new roof which comes with a 20+ year warranty. It is proven such roof warranties increase apartment values.
• The creation of new dwellings reduces your service charge due to economies-of-scale. The new roof and upgrades proposed will reduce the annual remedial costs.
• We work with Modular contractors, the dwellings are constructed off-site, reducing disruption and offering greater quality control. They are typically installed in as little as 4 weeks.

With all the above the value of the existing dwellings should increase. A cleaner, safer and more aesthetically desirable building can add up to 10% to the value of a property.

I have completed several developments and recently finished two rooftop schemes which I can send you the particulars of, if interested. Our in-house architect and planner can have some high-level plans produced for you to consider in conjunction with the proposal.

I have sufficient funding originating from two facilities; one is an institutional funder with AUM in excess of£500m. The other is our family business, Mala Investments and group of companies. Established in 1980, their core business model is in the commercial property sector.

If you wish to discuss this opportunity further or have any questions, please get in touch via my direct contact details below.

I've read this at speed. First impressions are "we" [the letter writers] buy your freehold for no more than £50K. But this is subject to a technical review that it is possible to "extend upwards" (the term modular may have been used poorly in the letter] and obtaining planning permission first. Then the new units will be sold and the developer makes a profit.

If I'm correct this is a scary proposition and appeals to greed to ignorance, of which I'm sure you have neither, but other directors may have a different view.

AiY(D)

[scrumpyjack]

Some issues to consider.

https://bbslaw.co.uk/airspace-developme ... ink-about/

If you and your fellow freeholders want to consider this seriously, you should not just talk to the first developer who comes along and, I suggest, should get some expert advice. How you find the right 'expert' I have no idea!

[mc2fool]

I've read this at speed. First impressions are "we" [the letter writers] buy your freehold for no more than £50K. But this is subject to a technical review that it is possible to "extend upwards" (the term modular may have been used poorly in the letter] and obtaining planning permission first. Then the new units will be sold and the developer makes a profit.

If I'm correct this is a scary proposition and appeals to greed to ignorance, of which I'm sure you have neither, but other directors may have a different view.

Some issues to consider.

https://bbslaw.co.uk/airspace-developme ... ink-about/

If you and your fellow freeholders want to consider this seriously, you should not just talk to the first developer who comes along and, I suggest, should get some expert advice. How you find the right 'expert' I have no idea!

Thanks for the comments and for that link, at a cursory glance looks interesting.

I haven't talked to the other directors, the letters just arrived this morning, but, as I say, the top floor flats (of which I occupy one) are already in the roof (a tile on wooden rafters mansard with a flat top and all windows in dormers) so even if it appealed (which it doesn't to me) I can't imagine it'd be possible, but I was just curious as to the ins-and-out of the offer.....

[bungeejumper]

Robert Jenrick's rule changes, introduced in 2020, allowing permitted development rights for building up to two additional storeys. (I think that means no planning permission is needed):

Here's the architects' viewpoint: https://architectureforlondon.com/news/ ... xtensions/

And here's how the issue panned out at a retirement block in Bristol: https://www.bristolpost.co.uk/news/bris ... dd-4693616

Which is not to say that the senders of your letters are evil, or necessarily intent on plundering your rights or your property. But as an entry to the subject, it suggests that caution might be the better starting point?

[Edit:] Might be relevant, might not. MSC is only three years old, and it has one director. Hmmmm.

BJ

[bungeejumper]

[Edit:] Might be relevant, might not. MSC is only three years old, and it has one director. Hmmmm.

Whoa, hold those horses. According to https://suite.endole.co.uk/insight/comp ... -group-ltd, MSC Group was still registered as dormant during the year to 31st October 2021! And that sole director is 22 years old.

So, on that evidence, he's presumably fresh out of business school, certainly touting for capital (it's on MSC's home page). And hell, he might not have built anything more than an IKEA kitchen in his whole life? The company's trading record is effectively nil. What would its guarantees be worth if it messed up?

I'm trying to see an upside, but so far no luck. There are better prospects out there.

BJ