This London property developer says the market is "detached from reality" because people won't pay £1.8m for a one-bed flat
Thousands of luxury flats lie empty while a housing crisis goes on
Isn’t property expensive? It costs so, so much, especially in places like London, where cartoonlike sums of money seem to regularly change hands for quite unremarkable shoeboxes. Barely a week goes by without some disgusting announcement of a new millionaires-only development, despite Britain’s ongoing housing crisis.
A ridiculous new point has now been reached. Mike Hussey, CEO of properly developer Almacantar (not the former Australian cricketer), has halted sales on the newly-converted Centre Point tower in response to potential buyers making offers he considered too low.
“We see no point in chasing a market that is increasingly detached from reality,” he said. Almacantar has sold enough to cover its costs and clear its debts (the first tenant, an 18-year-old Chinese student, moved in in June), so are now happy to leave half the flats empty.
Given that the 82 flats in the tower start at £1.8m for a one-bedroom apartment and top out at £55m for the five-bedroom penthouse at the top (which property director Kathrin Hersel previously said would pretty much sell itself, telling The Guardian “There are plenty of people in the world who could afford it”), is trying to knock a few quid off really that crazy? It’s undoubtedly really handy for the big Foyles and the Crobar (Dave Grohl’s favourite pub), but millions of pounds is silly money.
People have not been slow to point out that there’s a bit of history repeating itself here.
The tower was finished in 1966, but lay empty for years while the landlord shopped around for a single business tenant to take on the whole building. In 1974, protestors angry that there was a completely empty skyscraper in the middle of London while the country went through a housing crisis occupied the building, going as far as getting jobs with the security firm guarding it in order to do so.
The protesters described the tower as ‘the concrete symbol of everything that is rotten about our society,’ and the protest inspired the name of the homelessness charity Centrepoint.
The empty luxury flats in the building will be far from alone - of the 1,900 luxury apartments built in London last year, only half have sold.
There are over 3,000 empty £1m-plus houses and flats in the country, with developers citing Brexit concerns and raised stamp duty on second homes as the cause. The ten apartments at the top of the Shard, priced at over £50m each, have never been anything other than empty. Meanwhile there are incredibly long waiting lists for council housing - Camden council, which covers the area Centre Point is in, has a waiting list of 5,500.
There are over 400 new developments currently in progress in London, all of at least 20 storeys, despite so many failing to sell. Developers are offering increasingly outlandish incentives - some will even throw a new car in with an apartment purchase.
“We need ‘affordable’ one- or two-bedroom apartments priced at £500,000,” he said.
“We don’t need swimming pools and empty rooftop bars with no one living at home to buy drinks at them. There’s just way too many £1.5m-£2m-£3m flats that all look the same. We’d be much better off with decent quality but lower-spec homes built for actual Londoners. What’s the point in having private cinema rooms that sit empty and resident’s swimming pools with no one swimming in them?
“It just seems wrong.”
It’s hard to disagree.