Bosses of troubled property firm left my family to freeze in… a REIT mess

Troubled real estate company Home REIT promotes itself as a socially responsible provider of quality accommodations for the homeless, but those claims ring hollow for the Hyde family.

Life in their terraced house in the seaside town of Morecambe, where the family lived happily for three generations, has turned into a nightmare due to the state of a Home REIT property next door.

Home REIT’s business is to buy up real estate and then rent it out to charities, which in turn provide beds to the homeless and vulnerable adults. But the house next to the Hydes has been vacant for months and has been partially demolished.

The rear of the property was demolished 18 months ago due to subsidence – and what used to be an internal wall separating it from the Hydes’ residence is now covered with just a thin layer of plastic sheeting. As a result, 45-year-old Craig, a railway worker, his wife Helen and their two children are forced to endure bitterly cold and damp rooms.

The Hyde family’s woes are even more a result of the Home REIT implosion. The real estate company’s troubles intensified in November when Viceroy Research, a company led by short-seller Fraser Perring, questioned its business model.

Home REIT, chaired by Lynne Fennah, has been embroiled in disputes with charity tenants – such as Liverpool-based Big Help – who have withheld rent payments in protest at the condition of some properties.

Trading in the group’s shares has been suspended since the beginning of the year after the company’s failure to publish financial results on time and shareholders suffer large losses.

A forensic accountant investigates allegations of bribery. Home REIT is also facing multiple lawsuits from disgruntled investors.

While the company touted itself as a socially conscious housing provider when it went public in 2020, the Hydes fear for the state of their own home.

The roof at the back of the neighboring house, whose last occupants moved out three years ago, hangs in the void, vulnerable to the ravages of the Lancashire coastal weather. “I worry about what might happen to the rest of the decking if the wind gets under it,” said Mr Hyde.

The property next door was purchased in November 2020 for £130,000 by Pathway Homes Group (Morecambe) – a subsidiary of national social housing developer Pathway Homes.

Home REIT took control of Pathway Homes (Morecambe), through one of its subsidiaries, Home Holdings 1, within a week of purchasing the home. The rear was torn down in September.

An agreement was made with Pathway Homes (Morecambe) to reconstruct the adjoining wall.

But since the company was liquidated and its assets transferred to Home Holdings 1, the Hydes have been unable to contact anyone. They say multiple calls, letters and emails to Home REIT have gone unanswered. Mr Hyde said: ‘It is our second winter in this situation and although the first was quite mild, this time it was bitterly cold.

‘We don’t use the heating, because there’s no point. It would just go out through the wall and the bill would be astronomical.”

Plush: REIT founder Jamie Beale and his wife live in a detached house in posh Hampstead, north London, which they bought in 2021 for £4.6 million

Ms Hyde, 47, a hospital nurse discharge coordinator, said Home REIT “just doesn’t seem to care” about the situation she faces with her husband and children Cerys, 22, a nursing student, and Orlando, 10.

The Hydes’ plight is in stark contrast to the lavish lifestyle of the two Home REIT founders. Jamie Beale, 39, and his wife live in a detached house in posh Hampstead, north London, which they bought in 2021 for £4.6 million.

The three storey property includes four bathrooms, a master bedroom with his and hers dressing rooms and five further bedrooms plus landscaped gardens and a separate ‘trade entrance’.

Gareth Jones, 40, and his partner have a four-bedroom leasehold apartment in trendy Battersea, south London, which they bought for £232,500 in 2007, but which could now be worth £750,000.

Press: Home REIT President Lynne Fennah

Back in Morecambe, the Hydes have been in contact with their local council, but – although officials are considering whether Home REIT has broken building regulations – they have been told the dispute is a civil matter. Mr Hyde’s mother, Patricia, said she was paid £250 an hour plus VAT for a lawyer ‘just to do the basics’ of taking legal action.

She added that when her parents bought the house in the 1950s, it was surrounded by well-maintained single-family homes.

Patricia, a retired lecturer, said Home REIT’s purchase of 30 homes in Morecambe from Pathway “represented a monetization concern by using vulnerable people for their rewards.”

A Home REIT spokeswoman said repairs to the wall next to the Hydes’ home would now be an “urgent priority.”

She added that Pathway Homes Group performs repairs on behalf of Home REIT, as they are “the seller of the property.”

The spokeswoman said: “They are responsible for carrying out the refurbishment work and have been paid for it.

“We have urged Pathway to clarify what is being done to rectify this situation.”

Minister: We must eradicate rogue providers

Action: Homelessness Minister Felicity Buchan

The debacle at Home REIT has again called for a curtailment of the UK’s unregulated exempt housing sector, with a minister saying abuse of the system is ‘unacceptably high’.

In a letter to The Mail on Sunday, Homelessness Minister Felicity Buchan said the government intends to “eradicate this abuse” by backing a bill to regulate the sector.

Normally, the amount of housing benefit people can claim is capped to prevent predatory landlords from ripping off the state. But this ceiling does not apply to exempt housing, which covers the cost of additional care to help residents rebuild their lives.

While this comes at a large cost to the taxpayer of at least £884 million a year, the industry currently has weak oversight.

Buchan: ‘Most assisted living providers are good and provide the right support. Unfortunately, there are rogue providers. We cannot allow public money to get into the hands of rogue landlords, or to prevent vulnerable people from getting the support they need.

“But unfortunately that’s what’s happening right now… preying on the most vulnerable people in society is totally unacceptable.”

The new bill, which has passed the reporting stage in the House of Commons, was tabled by Tory MP Bob Blackman, co-chair of the All-Party Parliamentary Group for Ending Homelessness, and should allow the government to create national standards for service providers in the sector. They will have to register with the local authorities and submit to inspections.

Campaigners have questioned the role of for-profit companies in providing housing to vulnerable people in exchange for taxpayer-funded payments.

Read the full article by Homelessness Minister Felicity Buchan at mailplus.co.uk

Calum Muirhead