The billionaire and the 219 tiny flats: a new low for rabbit-hutch Britain?

<span>Photograph: Alicia Canter/The Guardian</span>
Photograph: Alicia Canter/The Guardian

Campaigners have piled in to criticise plans drawn up by a billionaire property tycoon to cram more than 200 tiny flats into an office building in north London. They describe it as a “human warehouse” that would be filled with people living in “cramped single-occupancy shoeboxes” like “rabbits in hutches”.

Amid claims that some of the planned flats would be as small as 15 sq metres – that’s less than 13ft by 13ft for residents’ entire living space – some locals say the proposal is one of the most shocking examples yet of the phenomenon known as office-to-residential conversion. A typical Premier Inn hotel room is 21 sq metres, while national space standards state that the minimum floor area for a new one-bedroom one-person home is 37 sq metres.

It was 10 years ago that, while London mayor, Boris Johnson pledged an end to “hobbit” homes in the capital, but examples of rabbit-hutch developments keep coming, and one leading architect told Guardian Money: “We’re heading towards the so-called ‘coffin homes’ in Hong Kong.”

The latest row centres on Alexandra House, an 11-floor office in the centre of Wood Green.

Behind this new scheme is a billionaire once dubbed “London’s buy-to-let king”, who built up a residential property empire valued at more than £1bn and then sold most of it shortly before the 2007-08 financial crash. Andreas Panayiotou is now into hotels in a big way, and also owns his own Bombardier Challenger private jet, plus a 40-metre luxury yacht that previously belonged to fashion designer Roberto Cavalli.

Panayiotou hit the headlines in 2012 when he put his own mansion in London’s “Billionaires Row” – The Bishops Avenue in north London – up for sale for £100m (according to Land Registry records, it sold for £19.5m in 2015).

Andreas Panayiotou
Andreas Panayiotou, the billionaire property developer. Photograph: David M Benett/Getty Images

Panayiotou’s firm Ability Developments has submitted plans to Haringey council to convert Alexandra House into 219 flats using laws that enable developers to bypass the traditional planning permission system and minimum space standards.

The proposals for the block – currently occupied by Haringey council – are light on detail. It is not even clear whether the flats would be for rent or sale, though if it is the former, the building’s owner could be in line to pocket millions of pounds in rent a year.

The plans have prompted an outcry locally: Catherine West, the Labour MP for Hornsey and Wood Green, who is standing for re-election, is among those calling for them to be rejected, arguing that they raise “serious questions about the quality of the accommodation and the impact such space constraints would have on people’s physical and mental wellbeing”.

One local resident wrote to the council to say that “the proposed density of residents in tiny living spaces suggests this property is intended as a benefits battery farm where housing benefit income is prioritised over basic human rights,” while another said: “This is inhumane.”

Colin Kerr (pictured), an architect who lives nearby, staged a protest outside the building a week ago. He printed out the submitted drawings and scaled them up, and says the proposed flats vary in size. He says many are no bigger than about 17 sq metres, though he estimates the smallest are about 15 sq metres.

“The drawings of the residential units show no room layouts or bathroom or kitchen facilities in the units. If each small ‘unit’ has a small bathroom, the total remaining floor area would be reduced… Kitchen provision and statutory food storage would take up further floor area. What space is left for living and sleeping?” says Kerr. The building, in busy Station Road, would be a “human warehouse,” he claims.

Julia Park, who is head of housing research at architects Levitt Bernstein and one of the London mayor’s “design advocates”, has also examined the proposals, calling them “dismal”.

She says: “All the new flats will be single aspect and, because the building faces north/south, half will get no sunlight and the other half are likely to overheat without mechanical cooling … Add in the traffic noise, poor air quality and lack of outdoor space and you have a very hostile living environment.”

Park points out that some of the proposed second floor flats are set back 3-4 metres behind a covered walkway: “They’ll be dark and gloomy even on a good day.”

During the past few years there has been a frenzy of office-to-residential conversions in some areas – a boom that is largely down to the fact that in 2013 the government relaxed the rules in this area. Under so-called “permitted development rights” (PDR), turning office buildings into housing doesn’t require planning permission – the developer simply has to notify the local authority of its intentions and gain what is called “prior approval”.

Park says: “There is no excuse for developments like this. It may not have been the intention, but PDR is actively incentivising sub-standard housing. Allowing this ‘new low’ not only raises the value of run-down office blocks far beyond their worth, it also pushes up the price of all the housing above it. It’s a huge own goal and a legacy that politicians will come to regret.”

Alexandra House in Wood Green
Alexandra House is on a busy bus route. Photograph: Alicia Canter/The Guardian

Housing is one of the key battlegrounds in this election, and Labour has said that if it gets into government, it will scrap PDR for new homes, thereby ending a “get-out clause” that allows developers to build “slum housing”. For its part, the government said in March that it intended to review the quality of buildings being converted to residential via PDR.

Land Registry records say the building’s owner is Workspace 14, though it was reported in September that Workspace had sold the building for £15.5m.

Assuming the plans go ahead, how much money could the owner or landlord make from those living there? In the event that the 219 flats were let to individuals each receiving housing benefit, they might stand to pull in £2.4m of housing benefit cash a year.

Panayiotou’s firm The Ability Group declined to comment on the plans or the objections. However, in a letter to the council, the developer’s agent, SM Planning, said: “It has been demonstrated that the proposal will have acceptable impacts having regard to highways and transport, contamination, flood risk and noise from neighbouring commercial premises.”

Haringey council has until 19 December to issue a decision.The council told us: “National legislation grants a blanket planning permission for the principle of the change of use of office buildings. Prior to the introduction of this legislation in 2013, the council applied to government for an exemption in certain areas of the borough, including Wood Green. The exemption was not forthcoming. The council doesn’t support prior approval conversion from office buildings to residential units.”