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‘We are trapped’: residents hit with soaring charges at luxury London homes


The Embassy Gardens development in London’s Battersea offers buyers “a life like no other”. Its website features lithe young women relaxing at various on-site facilities, including a Jacuzzi, sauna and sky-high swimming pool.

But it comes with unanticipated costs. One resident, who bought his flat in Embassy Gardens in 2015, said his service charge had increased 58 per cent since then to an annual charge of just over £6,500. “It just feels like I am a cash cow in my own home,” he added. “I am liable for a service charge that goes up 10-15 per cent per annum and I cannot reduce or opt out of it. I don’t think I will ever buy leasehold again.” 

Fifteen miles away in west London, High Point Village — marketed by the same Irish property developer Ballymore — promises “an oasis of calm in a busy world”. 

Since buying his flat in 2012, resident Adrian Gill has found life there less than relaxing. The 46-year-old airport worker said he had recently been diagnosed with an ulcerated oesophagus caused by stress. Rising service charges levied by Ballymore were the biggest contributor to his pressures, he added.

“I moved to London for a promotion and wanted a nice new-build flat with nothing to worry about or fix — but it has been non-stop stress and you are totally disempowered,” he said. “You are not a homeowner, you are little more than an inmate.”

A Financial Times investigation involving interviews with 25 residents across several of the company’s most prestigious London developments found a common complaint: rising service charges that residents say has left them feeling trapped in increasingly unaffordable homes. 

Airport worker Adrian Gill, who bought his flat at the High Point Village development in west London in 2012, said: ‘You are not a homeowner, you are little more than an inmate’ © Charlie Bibby/FT

Service charges ‘like a second mortgage’

Two of the most drastic examples include a resident at New Providence Wharf, a development on the banks of the Thames in east London, whose service charge rose 77 per cent to just over £9,000 over the past four years; and a neighbouring resident whose service charge has jumped 58 per cent to approximately £3,800 over the same time period. Ten Ballymore residents said their service charges had increased by 10-30 per cent annually since moving into their homes within the past decade. Another 14 residents recorded annual rises of 5-10 per cent.

Ballymore, which houses more than 20,000 residents in its developments across the UK and Ireland, said it did not profit from service charges and that any increases were largely due to inflation in services such as insurance and utilities. It added that service charge budgets across its developments had increased by just over 5 per cent annually over the past five years.

Nonetheless, residents remain angry about the escalating charges, which they believe stem partly from the need to repair poor workmanship during the developments’ construction. 

“We are trapped,” said another High Point Village resident, whose service charge has surged 67 per cent to about £5,000 since 2012. “Other people have tried to sell but [buyers] see the service charge and laugh and walk away.” 

A marketing executive living in Ballymore’s 21 Wapping Lane development said his service charge was “like a second mortgage”, having risen from almost £8,000 in 2013 to £12,500 in 2020. “We feel like we are being held captive by Ballymore,” he added.

Property experts have described the scale of some of the increases as “staggering”, “ridiculous” and “outrageous”. A Mayfair-based estate agent said service charges should rise by only 2 to 3 per cent annually and that some of the Ballymore increases were “bonkers”. 

New Providence Wharf, on the banks of the Thames in east London
New Providence Wharf, on the banks of the Thames in east London © Charlie Bibby/FT

The Association of Residential Managing Agents, a trade group, estimates the average service charge bill in London is about £2,000 a year. According to the HomeOwners Alliance, a lobby group, any service charge bill over £5,000 is “expensive” and should be questioned. 

Although Ballymore always delivers its service charge bills punctually, the underlying accounts setting out the reasoning for any increases are routinely three years late. This makes it difficult for leaseholders to challenge substantial rises. 

Ballymore said it had overhauled its accounts management team over the past year to respond to criticisms of its “poor performance”. It added: “We recognise and apologise unreservedly that the delays providing certified accounts on some estates were not to the timelines we expect. 

“We sincerely regret any impact these historic issues may have had on residents, but we are now in a period of change, one in which we are investing significant resources in better communications and engagement with residents and our resident associations.”

Sean Mulryan, left, founding chairman of Ballymore, with his son John, the managing director
Sean Mulryan, left, founding chairman of Ballymore, with his son John, the managing director © Steve Humphreys/Irish Independent/eyevine

To the fury of some leaseholders, Ballymore’s own financial position appears to be going from strength to strength. The developer came close to the brink during the financial crisis, but has since ridden a wave of demand for expensive new-build flats to establish a considerable presence in London. Last year its largest UK subsidiary recorded profits of £80m, while the group’s net asset value is estimated at more than £500m. 

Founding chairman Sean Mulryan, 66, and his son John, 38, the company’s managing director, have demonstrated a showman’s touch on a number of London developments. In January, a glass-bottomed, 25-metre swimming pool suspended 10 storeys high was installed at Embassy Gardens.

Competitors in the capital said they admired the private Ballymore’s rapid ascent, while suggesting the company might not have had some of the scrutiny faced by its listed peers on the way up.

The escalating charges are all the more galling for Ballymore residents given the maintenance problems they face on a daily basis. Many feel like their service fees have surged while their homes sag at the seams.

An artist’s impression of the glass-bottomed swimming pool at Embassy Gardens, prior to opening
An artist’s impression of the glass-bottomed swimming pool at Embassy Gardens, prior to opening © Ballymore/Shutterstock

Hot water and heating outages are a regular occurrence, as well as issues such as leaking toilets or windows, poor noise insulation, broken doors, windows that are prone to cracking, dilapidated communal grounds and substandard ventilation leading to overheating in the summer, according to numerous documents reviewed by the FT. 

Audrey Verma, a High Point Village resident for the past decade, said she and her husband Tony were forced to sleep on their living-room floor — the coolest spot in their home — during summer heatwaves. Residents complained of nosebleeds, fainting spells and exhaustion because of indoor temperatures reaching as high as 37C. 

James Walker, a resident since 2017 at Royal Wharf — a new development in east London made up of more than 3,000 flats and townhouses — said he was dealing with weekly outages of hot water; a loud humming noise from a water tank beneath his flat that keeps him awake at night, even with ear plugs; defective security gates; and faulty lighting in the kitchens and bathrooms throughout his building. 

Audrey Verma, a High Point Village resident, said she and her husband Tony slept on their living-room floor - the coolest part of their home - during heatwaves
Audrey Verma, a High Point Village resident, said she and her husband Tony slept on their living-room floor — the coolest part of their home — during heatwaves © Charlie Bibby/FT

Leaseholders say Ballymore often takes months or years to fix such problems and even then only after they have hounded the developer for help. Meanwhile, facilities including saunas, Jacuzzis and swimming pools are frequently out of service, while retail spaces that were meant to create a buzz with shops, restaurants and cafés often lie empty.

Ballymore defended its upkeep of these developments and its interactions with residents. It said that “no building operates without regular maintenance and unplanned service interruptions” and that it aimed to rectify them “quickly and effectively”. The company also said recent independent surveys showed residents found fewer “snags” in its properties than those in rival developments, and that such issues were “dealt with very quickly”.

It added that, “despite a challenging retail environment”, several commercial tenants had opened new premises at its developments over the past 18 months, including The Alchemist bar at Embassy Gardens; the Windjammer pub at Royal Wharf; and Elasko, a fitness centre at New Providence Wharf.

Residents fight back

As concerns have mounted that the service charge increases are unjustified, a growing number of leaseholders across Ballymore’s developments have joined forces to challenge the bills.

At New Providence Wharf, which boasts more than 1,500 apartments, residents have clubbed together almost £40,000 to pay for an independent review. Karryn Beaumont, a former chartered accountant who owns a flat at the development, has already carried out her own examination of the invoices underpinning the building’s service charges. 

She said Ballymore initially withheld access to the invoices before she resorted to lobbying her local council and the property ombudsman, and taking Ballymore to magistrates’ court. 

James Walker, a resident at Royal Wharf, says he has to contend with weekly outages of hot water
James Walker, a resident at Royal Wharf, says he has to contend with weekly outages of hot water © Charlie Bibby/FT

When she finally received the documents, Beaumont said she identified hundreds of thousands of pounds worth of errors. “Almost every error was in Ballymore’s favour,” she said, adding: “Clearly things aren’t right.” 

The biggest mistake identified by Beaumont related to Ballymore’s alleged failure to refund leaseholders for accruals they had already been charged for in 2015, leading to duplicate charges of £252,497.16. 

Ballymore said its new accounting team was “investigating these claims” and could not verify any figures until that work was completed. “If any duplicate charges are found, they will of course be refunded fully, and any historic errors will be reconciled and repaid where appropriate,” it added.

It said that an independent accounting firm would be appointed to investigate the development’s service charge accounts for 2015, 2016 and 2017. 

Other charges have riled residents. Ballymore spent £2,400 purchasing and decorating Christmas trees at High Point Village in 2017 — a cost one leaseholder said would have been more appropriate for “the Savoy or the Ritz, not a residential development like ours”. Ballymore said that the spending was appropriate for four trees at a “large development of 576 apartments”.

At Royal Wharf, the residents’ association successfully pressed Ballymore to remove a £140,000 cost for the rent of its concierge space. Then it was confronted with a new cost: £187,000 to be paid by leaseholders towards running a community centre.

A Ballymore resident said this highlighted the problem of attempting to fight the developer on specific charges. “It’s a bit of a game they play,” she said. “They may give you money back with one hand but take it back somewhere else.” 

Ballymore said the community centre, which opened in 2019, was a “service charge recoverable cost” and that running costs were shared “once they were known”.

The company’s approach to insurance commissions — another cost borne by leaseholders — is a further concern. Since 2013 the annual premium for High Point Village has doubled to almost £140,000. While it is normal for managing agents of residential developments to take a commission for securing this insurance — a payment they usually split with a broker — Ballymore’s share has raised eyebrows.

At New Providence Wharf, the insurance costs have almost quadrupled to just under £1m since 2015, while Ballymore’s share of the commission payment has increased from 44 per cent to 77 per cent.

Karryn Beaumont, owner of a flat in New Providence Wharf, carried out an examination of the invoices underpinning the building’s service charges
Karryn Beaumont, owner of a flat in New Providence Wharf, carried out an examination of the invoices underpinning the building’s service charges © Charlie Bibby/FT

The worry among leaseholders is that the substantial commission income means the developer has no incentive to shop around for the best insurance deal. 

Ballymore said it undertook an “independent third party review and re-tender of the freeholder’s insurance broker” last year, which showed that leaseholders “were obtaining value for money, comprehensive insurance cover and industry leading advice”. 

Leaseholders as a ‘source of steady profit’ 

Ballymore residents are by no means alone in grappling with these issues. Several recent government-backed reviews have suggested Britain’s 4.5m leaseholders are a vulnerable demographic who need greater protection. The Law Commission published an 860-page report last July that highlighted that the leasehold system had “too readily facilitated the extraction of excessive monetary payments”. 

The housing, communities and local government select committee similarly found in 2019 that leaseholders had too often been treated as a “source of steady profit” by developers, freeholders and managing agents. 

So far the government’s remedies have focused on ground rents — additional charges that can rapidly snowball — and making it easier for leaseholders to purchase the freehold of their homes. But these reforms, though positive, will not resolve issues with service charges. 

Many Ballymore residents believe a simple fix would be to ban companies from holding multiple roles as builder, manager and freeholder of residential developments. 

Residents across the company’s developments have developed a grim sense of humour about their situation. Many have found solidarity with one another via social media accounts that have sprung up highlighting the challenges of living on these sites, including the “Ballymore Hell” and “real_embassygardens” Instagram accounts.

High Point Village offers prospective buyers ‘an oasis of calm in a busy world’
High Point Village offers prospective buyers ‘an oasis of calm in a busy world’ © Charlie Bibby/FT

Residents readily acknowledge that publicising their problems with Ballymore will probably harm the value of their homes. But they also said they felt it was the only way to hold the company to account.

The prospect for some residents of huge cladding bills to ensure their homes meet new fire safety standards put in place after the Grenfell Tower tragedy has compounded their concerns and pushed some leaseholders to the brink of despair. 

A teacher in New Providence Wharf, whose service charge has risen from £5,000 in 2016 to just over £6,000, said there was a lot of rage on her estate. “We are all normal people from normal walks of life. We can’t afford to keep spending on wasted facilities. I can’t sell, I can’t rent, and I just can’t plan my life. There are schools I would like to work at but I am bound to my flat and I am angry every day because I can’t even get an email back [from Ballymore]. It is stressful. And it is ruining lives.” 


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