A senior minister has said he has “significant concerns” about one of Britain’s biggest property managers after dozens of residents complained of high charges, slow repairs and aggressive debt collection techniques.
It is the latest sign of growing anger in Westminster over the behaviour of FirstPort, which manages properties on behalf of 1 million people, and other leasehold management companies.
Pennycook has previously called the unregulated leasehold market a “wild west” of operators and is planning to publish a draft bill in the coming weeks that would all but end the leasehold system.
Matthew Pennycook recently met Martin King, the managing director of FirstPort, to raise his concerns. The minister made clear in a subsequent letter he had been unconvinced by some of the company’s responses.
He wrote: “I have significant concerns about FirstPort’s performance and the service you provide to residents on sites you manage. It is clear from the correspondence I receive from MPs and leaseholders that significant issues remain: unreasonable service charge increases, concerns over the proportion of service charges that are charged as management fees, a lack of transparency in your engagement with leaseholders, slow responses to complaints, and concerns over your approach to debt collection.”
A FirstPort spokesperson said of the meeting with Pennycook: “We discussed the positive changes we have implemented over the last 12 months as well as how we are contributing to the broader reform of the sector. There remains more to do as we continue our work to drive improvement across the industry.”
FirstPort, which is owned by the French private equity company Emeria, is the UK’s biggest leasehold management company, managing about 6,000 sites.
The company is particularly active in the leasehold market, where it manages buildings on behalf of freeholders, charging leaseholders service charges for doing so.
In recent years the company has been the subject of frequent complaints about its charges and the way it manages its properties. MPs in urban areas say leasehold management in general – and FirstPort in particular – has become one of their most regular sources of correspondence from constituents.
MPs recently held a hearing in parliament for disgruntled FirstPort residents. One leaseholder, David George, described how he experienced water damage inside his Manchester property in 2020 as a result of problems with his roof. For several years, he and other leaseholders petitioned in vain for FirstPort to fix the roofs, spending thousands of pounds on legal fees in the process. Last Christmas, George said, flooding made several apartments uninhabitable.
Another leaseholder, Sheyba Jani, described a list of unresolved problems at her 200-apartment block in Swindon. They included a one-year delay in repairing fire alarms, persistent basement flooding and malfunctioning lifts.
A third, Chia-Yen Ho, said she and other leaseholders in her 304-apartment complex had suffered regular flooding, damp and mould. She took FirstPort to court, where she said the company’s solicitors behaved like “bullying, abusive debt collectors”.
Peter Larwood, who lives in Cardiff Bay, said he had withheld money for repairs that were not being carried out, after which he was sent letters from FirstPort’s solicitors – each one with a £95 charge they demanded he pay.
Rachel Blake, the Labour MP for the Cities of London and Westminster, said: “This evidence shows just how deeply our constituents’ trust in FirstPort has been eroded.
“We have heard enough excuses. FirstPort must now demonstrate proper accountability. Leaseholders deserve transparency, timely repairs, and communication that respects their rights as paying customers.”
FirstPort said: “We take these matters being raised by residents seriously and recognise the impact that complex or ongoing issues can have. Where concerns arise, we work directly with customers to understand the detail, resolve problems as quickly as possible and provide regular updates on progress.
“Over the past year we have invested significantly in improving our systems, strengthening our customer service offering, and increasing qualifications across the business. This includes new training requirements and clearer performance measures.”
Pennycook is putting the finishing touches on a draft bill that will ban the sale of new flats under the leasehold system and make it easier to convert existing leasehold properties into other forms of ownership.
He launched a consultation in July into making service charges more transparent and creating a new licensing regime for property managers.
