A property company controlled by a millionaire Tory MP said it would sell its stake in an east London estate where hundreds of residents face massive rent rises.
The Benyon Estate, the family company of Berkshire MP Richard Benyon, held the management contract for the New Era estate in Hoxton. It told residents on Thursday it was selling its stake in the consortium that owns the redbrick flats.
New Era was built in the 1930s and has offered affordable accommodation for decades. Some residents have lived there for 70 years.
It was bought in March by funds controlled by Westbrook Partners, a US investment group. The Benyon Estate was awarded the contract to manage the estate and a stake of less than 10% in the property.
The Benyon Estate told residents in a letter that it would be selling its shareholding back to the landlord, Hoxton Regeneration Limited.
“New Era residents have made it clear that they do not welcome our involvement in the future of the estate. They made it clear that they wanted us to pull out, and this is what we have reluctantly decided to do,” he wrote.
“With a stake of less than 10% we already had only limited influence over decision making and policy. Our withdrawal means that the future direction of the estate will now be wholly a matter for the landlord.”
Lindsey Garratt, a single mother with an eight-year-old daughter, pays about £640 a month for a two bedroom New Era flat. However, residents like her had been told they will be liable to pay market rates come July 2016, which could be in excess of £2,000 a month for a dwelling like hers.
She said the decision by the Benyon Estate to sell its stake was the first step toward victory. It comes five days after residents organised a protest attended by Russell Brand outside its offices. Benyon also manages 300 properties in nearby De Beauvoir Town.
Garratt said that residents were not intimidated by Westbrook. She believed the company would not want the negative publicity of evicting 93 families simply because they could not afford to pay rents substantially higher than take-home pay for most.
They want Westbrook to sell the flats to a more socially responsible landlord such as a housing association who would maintain rents at a more affordable level.
Edward Benyon, Richard’s brother, had told residents in the summer that the new owners wanted to renovate the 90 flats and build more on the roof, and that rents would rise.
A new management company would now be appointed for New Era, but it was unclear how long that process could take.
The Benyon Estate said that its contract with Westbrook did not allow it to sell or transfer the share ownership to a social landlord or housing cooperative. The flats were not subject to rent controls.
Richard Benyon lives in Englefield House, a stately home near Reading surrounded by 3,500 acres of woodlands.
Westbrook could not be contacted for comment, while Hackney council did not respond to a request for comment.
Source: The Guardian