The owner of a controversial housing development ‘hell-hole’ in Mitcham made almost £2.5 million profit in just one year.
Connect House, based on the Willow Lane industrial estate, is home to more than 200 children and up to 80 families.
The flats are overcrowded, with instances of families of six sleeping in two beds.
Residents complain of damp and mould, dirty furnishings as well as the lack of anywhere to buy even basic necessities.
They are placed in the former office block of 86 flats by councils from across London as ‘temporary’ accommodation, after becoming homeless.
Some were kicked out by private landlords hiking rents. Others are single mothers fleeing domestic abuse. A number of families have been there for more than two years.
Upon learning of the landolords’ profits, one mother, 31, who wished to remain anonymous, said: “You’ve got to be joking me. This is ridiculous.
“His money is just going up and up and up, at the expense of all these kids that are running around this place. That’s not fair, that’s not fair at all.
“It’s sad that he’s making all this money and he can’t even take the time to check that we’re ok. It should have been unacceptable from day one.”
Freedom of Information requests show the councils are paying £30-£40 per night, per flat which MP Siobhain McDonagh estimates means a £900,000 turnover for the North London based property owner, Joel Wider, 38.
Mr Wider’s representative, Sam Adler, claims the true figure was ‘nowhere near’ that amount.
But a South West Londoner investigation can reveal that accounts for the parent company, Connect House Ltd, of which Mr Wider is the sole director and shareholder, show the company made £2.49 million worth of profit in the first 12 months of the flats being built.
Gary Inglis, a representative of Mr Wider’s accountants Raffingers, confirmed that the profit figure was correct.
But he said that the profits arose from the transfer of property to another company owned by Mr Wider.
Mr Wider’s publicly available accounts show that the ownership of Connect House is split between a complicated web of subsidiary companies, all of which are owned exclusively by Mr Wider.
The accounts of one subsidiary, JWD Investments Ltd, show the company has held 66% of the flats at Connect House since February 2016.
The councils’ money is collected by property manager Assetgrove, who in turn provide Mr Wider with a guaranteed rent with which he can secure loans.
Even more galling for the councils, which have included Merton, Croydon, Sutton, Bromley, Bexley and Barnet, is that when some of the flats were advertised for private rent in March, they were marketed at 40% less than the councils are paying.
In his letter to the MP in April, Mr Adler claimed: “For the record the landlord receives almost equivalent amounts of rent from private tenants.”
However, he admitted to South West Londoner that the properties were in fact leased at reduced rates.
He also claimed that the landlord’s rental income was heavily affected by the ‘high fees’ charged by the property manager, Assetgrove.
Yet, a 2015 promotional video for Assetgrove shows Mr Adler praising the company’s ‘very competitive prices’.
Assetgrove’s website describes the company as one of London’s ‘leading providers of nightly let temporary accommodation’.
However, 70% of the company’s 24 google reviews are one-star ratings.
The tenants at Connect House described similar conditions. One father, 39, spoke of the struggle of raising a young family of four in a one bed flat.
He said: “We are always struggling. We go nearly one and a half hours to get the kids to school and 45 minutes to the park.
“It’s too small, if they made it bigger we could survive.”
MP Siobhain McDonagh, whom Mr Adler accused of running a ‘campaign’ against Mr Wider, pointed to an example of a mother at Connect House whose flat was so cramped that her baby could not even learn to walk.
She said: “That brings home to you the impact these flats are having on the development of young children.
“I think it’s appalling that we’re spending money to house vulnerable families in accommodation that existed in the last century.
“Connect House is a hell-hole and an accident waiting to happen. I would ask Mr Wider: is this really where you want to earn your money?”
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