The Friends Examine the Financial Argument 2: Maintenance Costs

The developers maintain that they have to build so much new-build to raise the enormous maintenance costs associated with the listed buildings.

There are many problems with this argument and it is disputable whether it is even a valid one to make. But here, we will look at the developers’ maintenance claims in more detail.

Friends of Craighouse issued a Freedom of Information request to obtain Napier University’s maintenance costs for the site.

Over the 7 years from 2005-2011, the maintenance costs for the buildings and the grounds was an average of £131,860.

The Partnership are claiming that the site will cost an astronomical £435,000 maintenance per year. A massive £320,000 extra! They are trying to use this as an argument for why they need to build so much new-build – in order to raise the maintenance costs.

The grounds have not historically cost a lot to maintain: an average of £26,753 per annum.  (And the Council praised Napier for its good maintenance of these grounds in their 2007 Parks and Gardens Survey).

Perhaps it might be reasonable to imagine this figure could rise somewhat. But it is hard to work out the developers’ rationale for their vastly inflated sums, particularly as they are talking of gifting a portion of the woodland and the nature reserve (the parts they can’t easily build on) to the public or the council. This would, in fact, offload the land plus the associated maintenance costs.

In addition, the buildings maintenance costs also include “furnishings”, “heating” and “fixtures and fittings” – much of which would be considered private costs for a domestic development. It is unusual in Scottish domestic developments for heating and furnishing costs to be shared through factoring.

Therefore the maintenance of the site as private residential over institutional should be a lot LESS.

So, where do these extra maintenance costs come from?

THE WHITE YOUNG GREEN 25 YEAR LIFE-CYCLE COST STUDY – A RED HERRING?

In the exhibition, the Partnership’s quoted the White Young Green 25 Year Lifecycle Cost Study prepared for Napier University which, the developers say, bring the maintenance costs to £750,000 a year!

This figure quoted from the report would seem to be a red herring and simply a diversion.

Many people have said to us that these massive costs will be to do with roof repairs on an historic building…In fact, it is nothing of the sort.

After a lot of delay and resistance from Napier and the developers, The Friends have finally got hold of the White Young Green report.

In that study:

  • over £490,000 p.a. of costs are attributed to “Electrical and Mechanical Services” – i.e. the associated costs of institutional use – and therefore not applicable to  private residences or the maintenance of historic buildings
  • £30,000 p.a. of costs are attributed to the Learning Resource Centre, which the developers plan to demolish.
  • In addition, over £150K of costs are attributed to internal maintenance and redecoration – half of which won’t be applicable as factoring for private residency should only include communal areas as people decorate their own homes to their own tastes

Interestingly, if the institutional mechanical and electrical costs, as well as the costs of the Learning Resource Centre are removed and the redecoration costs halved – we get back down to around £150K per annum, which does – in fact – correspond closely to the historical maintenance costs of the site discussed earlier. This cost does include all the big long-term capital maintenance costs for the buildings. Divided amongst the proposed 90 flats, it comes to £1,600 per annum, which is below the £2,000 target maintenance cost for the development put forward by the developers.

QUESTION FOR THE DEVELOPER:

So what will happen to the rest of that huge amount raised by factoring charges? Can we assume that Mountgrange would pocket it annually through one of their associated factoring firms?

CONCLUSION

The developers have let people believe this enormous cost is to do with maintaining the listed buildings but, in fact, The White Young Green report shows that the costs of maintaining the listed, historic buildings at Craighouse (for residential use) are in line with the costs of maintaining other listed historic residential buildings around Edinburgh.

And, when you think about it, this makes sense. Why should Craighouse be so much more expensive to maintain that the wealth of other listed historic buildings that are happily maintained presently by private owners across Edinburgh?

This is all without even starting to look at how much of the maintenance costs will be swallowed, not by the listed buildings, but by 110 new build dwellings and a very expensive-to-maintain land-form.

The obvious conclusion would be to remove these elements from the development, convert the listed buildings and keep the development at a sensible size.

SUMMARY

In a nutshell:

  • the historic maintenance costs are £150,000 per annum.
  • The White Young Green, contrary to what the developers would like people to believe, actually confirms that the maintenance costs for the buildings (without associated institutional costs) would be approx £150,000 per annum.
  • There is NO CASE for new build based on maintenance costs according to the what is evidenced in the White Young Green report

We would be interested to hear from the developers on this or any of the  issues raised.

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7 Responses to The Friends Examine the Financial Argument 2: Maintenance Costs

  1. Nice work folks – I get the impression much of what surrounds this “development” is absolutely rotten.

    As regards the White Young Green report, if it is in electronic format could you possibly upload to your website?

  2. We need to find out if we have permission to upload it to the website. It really is a set of figures with no explanation. There is particularly no explanation of why the mechanical and electrical costs are so high, although it does seem reasonable that a university would need expensive mechanical and electrical systems to help with teaching and to handle the number of students. I did see Napier complaining about FoI documents being uploaded publicly before, but they may not have any legal basis for doing that, especially with the White Young Green report, which has so little detail.

  3. I seriously doubt they’d have a legal basis to complain, given FOI requests are for public domain information in the first place. cf. http://www.whatdotheyknow.com/body/napier_university

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