Autumn Newsletter 2022

In this issue:

The Building Safety Act 2022

We have closely monitored the development of the Building Safety Bill which gained Royal Assent in April and is now the Building Safety Act, with a large proportion of the Act’s provisions coming into force in June.

The Building Safety Act will have significant impact on any schemes developed by any social housing provider moving forward. Key areas where these impacts will be felt include:

  • The Act gives the Architects Registration Board powers to monitor the training and development of architects to ensure that competence is maintained
  • The Act is designed to introduce a more rigorous system of collecting and collating information, as well as accountability, meaning that all data generated at all stages of a development – from planning, through design and construction, and into occupation and operation – must be archived in the building’s mandatory “Golden Thread of Information.” This information will also include the building’s safety cases, i.e. a report which identifies the building’s major fire and structural hazards, as well as details of the Accountable Persons involved in the building’s development and operation.
  • All of this information is inextricably linked to the Building Safety Regulator issuing formal certification indicating that the building is fit to occupy.
  • The new Regulator also assumes responsibility for the registration and professional standards of Building Control officers.
  • The Act introduces new rights for building owners to take action against the manufacturers of defective construction products.
  • The Act introduces protections designed to reduce the liability of leaseholders for the costs of remediation of unsafe cladding.
  • The Act introduces the requirement for information to be provided to the Regulator at three key Gateways:
  1. Planning – where the applicant must submit information verifying that they have considered fire risks within their proposals
  2. Pre-construction – where construction cannot begin until the Regulator is satisfied that it will be carried out in accordance with the Building Regulations and
  3. Completion – where the regulator will carry out a final inspection to determine that works have been carried out in accordance with the Building Regulations before issuing a certificate to allow occupation.

In addition, developers now have to ensure that:

  • Staff understand and comply with the new requirements and are competent to be duty holders
  • Suppliers provide compliant materials
  • Software is in place to maintain and access the ‘golden thread’ easily
  • Clear and robust communication protocols are in place

The Building Safety Act actually represents a number of positive outcomes for our clients, and will prove to be of benefit to housing providers and their residents:

  • The increased powers for the Architects Registration Board offers an added degree of quality assurance when assessing the competencies of architects tasked with designing a new scheme.
  • The Act will enable clients to act against manufacturers who supply a construction product which fails to comply with requirements, has been mis-sold, is inherently defective, or which causes homes to be unfit for habitation.
  • The Act extends the liability period for breaches of S38 of the Building Act to 15 years. This broadens the timeframe within which housing providers can claim against a contractor for defective work should it be necessary. Should remedial works be required for any reason after handover and occupation, the building owner will no longer be responsible for funding this work after the building is 6 years old, as was previously the case.
  • This extension has been applied retroactively, meaning that building owners can claim against the original developer/contractor for any defective property that was built after 2007.
  • While Leaseholders have now been given protection against obligation to pay for the replacement of defective cladding, the extension of S38 of the Building Act and the liabilities of manufacturers of defective materials means that this burden has not necessarily fallen upon the freeholder or building landlord.

Martin Arnold have been working on a number of cladding projects in the last year and so we are aware that there are a number of questions that many people need the answers to. We have put together a series of short videos on the topic that you may find interesting.

Martin Arnold’s Autumn Seminar Returns

After a two year hiatus, Martin Arnold are delighted to announce the return of our Autumn Seminar on Thursday 13th October 2022 in Central London.

This year, we will be taking over The View in Holburn where Martin Arnold’s Roger Arnold, Managing Director, and Chris Martin, Director, will be joined by Jacqueline Esimaje-Heath, Growth Director at L&Q, and Jonathan Corris, Partner at Devonshires Solicitors, who will be sharing their expertise and knowledge with us as we discuss the issue: Joint Ventures: A Solution to the Housing Crisis?

The seminar will look at the role of Joint Venture procurement in the current housing market, with insights from L&Q on the client’s role and perspective, practical advice from Devonshires on what to look out for, and some case studies and further analysis from Martin Arnold.

The panel will look to pick up lessons learned and the evolution of the Joint Venture model over recent years.

Places are limited and being taken up quickly so to secure your place, and avoid disappointment, please RSVP to as soon as possible.

About Jacqueline Esimaje-Heath: Jacqui is an architecturally trained, experienced real estate director, with a background of working within both the public and private sectors. She is currently Growth Director at L&Q and a Non Executive Director at Yorkshire Housing. In her previous roles, she has held responsibility for the areas of residential property development, housing and management consultancy, regeneration, private sector renewal and residential sales & marketing.

Jacqui is also an experienced non-executive director, with over 20 years’ experience in providing strategic leadership in the not-for-profit sector.

About Jonathan Corris: Jonathan has worked with clients on a variety of development projects from large scale regenerations to the delivery of a single new property. His work covers advising clients on a wide spectrum of documentation including JV agreements, development agreements, option agreements, conditional contracts, planning agreements and managing disposals of completed developments for Registered Providers and private developers.

Jonathan also works closely with Devonshires’ corporate and governance team in relation to ensuring that clients have the right structures in place to deliver and fund their development programmes. This includes interacting with regulatory bodies and commercial lending institutions to ensure that client objectives are not delayed.

About Roger Arnold: Roger is a founding owner of Martin Arnold with decades of experience as a Chartered Building Surveyor. Roger is a Fellow of the RICS and fulfils the role of an APC Assessor regularly. Roger is actively involved in all areas of the industry and specialises in large estate transformations, land development, bespoke procurement and financial advice. Roger leads on all aspects of MA business, ensuring a sound platform to provide business stability.

With in-depth experience of the residential and commercial sectors, Roger has become an expert in providing Housing Associations and Developers with advice on large and mixed-use developments. Roger works very closely with clients to provide bespoke and viable financial models.

About Chris Martin: Chris leads our Quantity Surveying and Cost Consultancy services. He has significant experience in a number of different sectors including residential, education, commercial and healthcare.

Having expanded the range and quality of the Quantity Surveying services offered by Martin Arnold, Chris is a specialist in best value procurement, development appraisal viability, and early stage project delivery advice.

Chris and his team provide essential support and advice on cost management and procurement for large, new build developments, providing services directly to large Developers, Housing Associations and Contractors.

Case Study: Charlton Lido

Martin Arnold were approached by Greenwich Leisure Limited (GLL) requesting assistance in bringing Charlton Lido – one of four iconic London lidos originally designed by Harry Rowbotham and completed in 1939 – back to life after it had fallen into disrepair and any restoration was deemed not viable.

The site consisted of an Olympic size swimming pool, paddling pool, a main, u-shape building with centralised entrance, and a front garden screening the building from Shooters Hill Road as well as car parking along its west wing.

The scope included demolition of the main building and its replacement with a new multi-function leisure centre consisting of gym, multi-use studios, wet and dry changing facilities as well as rooftop café and terrace. The west wing was retained and facilitated pool plant while the main pool’s depth has been significantly reduced (from 3.2m to 1.8m on deep end) in order to make use of energy and water more efficient.

The key concept idea behind the new build element was to achieve an appearance reminiscent of water waves – hence the proposal for the shape as well as original proposal for the translucent material (polycarbonate). The new building sits largely within the existing building’s footprint. Initially, the main entrance was to be centralised with gym and studio on either side and dry changing at the back.

The location of the main entrance has been set adjacent to the new car parking along the west wing while the main floor level has been lowered to enable easy access to the building.

The originally proposed ‘building’s skin’ has also been substituted with more robust solutions – brick at ground floor level with rainscreen cladding at the top.

Added value:

  • Iconic lido brought back to life
  • Transformed appearance
  • Modern leisure facility with gym, studios and rooftop café with terrace
  • Building which promotes healthy lifestyle and social interactions

Party Wall Matters

Martin Arnold are experts in Neighbourly Matters, a term used to describe common issues that can arise between neighbouring property owners, such as rights of access, crane and oversail, boundary and Party Wall matters. We understand how these issues can easily disrupt and delay a project, therefore our team are on hand to provide advice to manage these them effectively.

Are you aware whether the works for your project require a neighbour’s consent?
It is essential to review any neighbourly matters which may affect your project at the earliest opportunity. Whether the permissions you require are under the process of the Party Wall Act, or whether they simply require an agreement or licence from a neighbouring property to permit access, these agreements all take time. You should commission a surveyor’s review immediately to ascertain whether any neighbouring properties or land may be affected by your project, and seek advice as to what notifications needs to be given to the neighbours to allow you to complete your works successfully.

Are you clear on who is dealing with these required permissions?
At the outset of the project you, as the Building Owner, should be clear on the line of responsibility when it comes to enabling your works. You should be clear with your contractor whether the responsibility for access permissions sits with them or whether it is something that you will aim to resolve long before the project reaches site. Either way, the legal responsibility for Party Wall Matters sits with the registered title owner of the property and whilst the programming requirement can be passed onto the contractor, the Building Owner must take responsibility for ensuring that the right appointments are in place and the correct Notices have been served, and Awards agreed, to facilitate the works. The legal requirement for the payment of any costs associated with the Party Wall Act also sits directly with the Building Owner, something which is often forgotten and can cause unnecessary disputes throughout the process if not dealt with effectively.

Did you answer NO to any of the above? What are the risks?
There is no deemed right of access to another person’s land without the relevant notifications or agreements being in place. It may be that the notifiable works that you are undertaking permit a right of access through the Party Wall Act, however this needs to be correctly notified to, and agreed by, the adjoining owners. Without these agreements being in place, you would be in breach of the Act and therefore at risk of a court injunction being served against you and your works. Your works may also not be notifiable under the Act; if so, then you would need to seek a separate agreement from the neighbouring owner if you need to gain access to their land to complete them. Once again, without the relevant agreements being in place, you can run the risk of committing a trespass, which may also be subject to an injunction.

If you are in any doubt about the requirements on your project, we would be delighted to speak with you and discuss the next steps. We can provide you with a copy of our Capability Statement regarding Neighbourly Matters and can also offer various CPD sessions on the subjects.

Should you wish to discuss Party Wall matters further, please contact our Director, Tom Hopkins, who would be happy to assist you.

Case Study: Homer Row

Martin Arnold were appointed by the Building Owner to manage all Neighbourly Matters in respect of the development in the heart of Westminster.

The works involved the complex demolition of an existing industrial unit, landlocked by a number of adjoining owners, along with a two storey basement excavation and the retention of the adjoining buildings. The construction shall provide a new five-storey block containing 7 luxury apartments for private rent.

Martin Arnold’s engagement was initially to carry out an appraisal of the site, reviewing the Building Owners proposals and providing a Neighbourly Matters assessment in terms of advising on the required notifications that would be needed to adjoining properties in relation to notifiable works under the Party Wall etc. Act 1996.

Members of our Professional Services Team were appointed, and assisted in producing and serving the relevant Party Wall Notices and establishing contact with all relevant adjoining owners. The involvement included negotiations with adjoining owners surveyors to agree a set of Awards for demolition, excavation, piling and construction of the property; along with ensuring that scaffolding and licencing agreements were in place to allow the Building Owner to successfully complete the works.

Martin Arnold played an integral part at the early stages of this project to ensure that the Building Owner was fully protected in terms of adhering to party wall legislation, and protecting themselves from spurious claims of damages and equally the adjoining owners from damages that could be attributable to the works on site.

Critical Challenges
The biggest challenge on this project was managing the expectations of the stakeholders, along with the management of the project timelines alongside the statutory requirements of the Act. With a number of adjoining leaseholders and freeholders, it is always a challenge to manage the process alongside continued liaison with all of the relevant parties.

We were able to ensure that all Awards were put in place promptly upon conclusion of surveyor and advisory engineers review.

Tender Prices & Market Commentary

Construction cost inflation and volatility in prices continues to be a feature of the market at the moment. Anecdotally prices seem to be settling somewhat and this is borne out in some of the indices being forecasted. However there remains huge uncertainty in the market around potential further disruption to gas supplies and prices, the weakening pound and the wider economic climate.

The BCIS TPI is reporting 1.4% increase in the quarter compared to previous quarters this year of over 3% and this quarterly rise is forecasted to drop back below 1% as we enter 2023.

The BCIS TPI panel also report an increase in Contractors willing to tender which aligns with what we are seeing at MA. This is as contractors are balancing the potential for UK recession with the fact that the construction industry has reasonable workload and is under-resourced.

The year on year change in the cost of materials is still high with an average 15% increase versus 2021 and some materials seeing increases of over 25%.

Looking forward it is anticipated that labour costs will become an issue for contractors as the workforce contend with the cost of living crisis. This will continue to be an inflationary pressure into next year.

In conclusion we remain in very uncertain times with all parts of the market moving in different manners and reacting to each other. The key advice is to stay current with the situation and remember that these are short terms issues against potentially longer term projects.

Help Support Jim’s Virtual Marathon

Jim Martin will be running the London Marathon Virtually on October the 2nd, 2022 on behalf of the fantastic Pilgrims Hospice.

At its heart, Pilgrims is dedicated to providing skilled and compassionate care, free of charge, to people living with an incurable illness in east Kent. Their vision is that people with a life-limiting illness are supported and empowered to live well in mind & body, making the most of the time they have. They care for over 2,500 patients a year, at their 3 inpatient units in Canterbury, Thanet & Ashford, their therapy centres, or in patients’ own homes.

With 80% of their funding being voluntary contributions, your support cannot be overstated.

Jim will be running along the South Coast, in Hythe where he lives, using the Royal Military Canal as his route. Much as Jim loves the built environment and streets of London, he would assure you that running in Hythe, “where the countryside meets the sea” along the banks of the Royal Military Canal, beats running through Shadwell!

Jim has run many marathons in the past, but this will be his first marathon, running as The Mayor of Hythe and the Speaker of the Cinque Ports. Please note, he will not be running in his robes and chain!

We realise that times are hard for everyone but if you are able to support this fantastic cause, your money will be well spent.