Leicester Mayor ‘disappointed and annoyed’ after £26.6m property deal falls through

A deal to sell 371 homes to Leicester City Council has been called off after the seller allegedly attempted to attach new conditions to the sale.

The £26.6 million property deal the council brokered last year fell through in January after the seller found out the properties were worth more than the council would be paying.

The council has now revealed the property owner is Jamie Lewis, a city-wide landlord and owner of the Code student accommodation brand.

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The value of the properties was revealed when the deal was called in for scrutiny by councillors in December.

Mr Lewis allegedly attempted to add a further condition to the agreement to make up for the difference and the fact housing prices have gone up since the deal was arranged – that the council would guarantee that he could buy the Freeman’s Common Waste Site at market value.

Speaking to press this week, city mayor Sir Peter Soulsby said he was both ‘disappointed’ and ‘annoyed’ by the loss of the 371 homes.

He said: “I’m more than disappointed because we had a deal that was entered into in good faith.

“I’m disappointed particularly for the tenants of those properties. Some do need significant improvement.

“I wrote back to him and said he had made a commitment to this deal and I could not possibly tie it to another deal elsewhere.

“It is indeed the case that the property prices have increased, but that doesn’t entitle him to try to add conditions about the sale of another piece of land in a way about which the public would undoubtedly be very, very suspicious.”

Sir Peter added the money, which would have come from a £100 million pot of funds set aside specifically to help the council meet its manifesto pledge of 15,000 new council homes, would be used to buy or build housing elsewhere.

“It’s disappointing, it’s quite annoying actually, but it’s not disastrous for us,” he said.

“Obviously it does mean that 371 contribution to our 15,000 commitment is something that will have to be picked up in other ways.

“The money is not lost, it is sitting there, it will be used for these purposes.”

The deal was criticised by some in the council when it was announced as the portfolio was largely made up one-bed properties and 350 of them were already occupied.

Liberal Democrat leader of the opposition Councillor Nigel Porter said in November: “Just going into the market and buying bedsits and one-bed studio flats that are already there isn’t really going to do anything in terms of addressing the housing shortage.

“I don’t understand how this is going to address anything, other than just going and spending a huge amount of tax payers’ money to buy up properties that already exist.”

LeicestershireLive has approached Mr Lewis for comment.

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Leicestershire Live – Leicester News