How did homes deemed ‘worthless’ by the council end up in the hands of a Hong Kong billionaire?
How did homes deemed ‘worthless’ by the council end up in the hands of a Hong Kong billionaire?
An investigation by The Sunday Times unveils alarming truths - plus the rest of your weekly briefing
Dear readers — today’s briefing features Li Ka-shing, a 94-year-old billionaire from Hong Kong known as “Superman Li”, who has acquired a selection of properties in Toxteth. This alone isn’t anything unusual — in fact a recent survey found that Chinese and Hong Kong residents own £8.75 billion of property in Liverpool — but the Toxteth homes were recently given away for virtually nothing by the council. An investigation by The Sunday Times has attempted to get to the bottom of it.
Our weekend read about why companies are leaving Liverpool has had a massive response, and has already become one of our most engaged stories ever. Dozens of people shared it on Twitter, including local politicians and business figures, and there’s a great conversation going on among our paying members in the comments. We had nine new members join over the weekend too, so if that’s you, welcome. “This is a tragic read but excellent and honest reporting from @liverpoolpost and should be a wake up call for the city region’s politicians,” said Liberal Democrat councillor Kris Brown.
The article looked at a number of companies who have left the city region in recent years and questioned whether enough has been done to retain them. It read: “In simple terms, Liverpool shouldn't be functioning like a parent tearfully waving its children off to the big city. As one well-placed source puts it: ‘we get the Amazon warehouse jobs, Manchester get the Amazon programmers.’”
To help us do more journalism like this, that holds local politicians to account and creates a debate about the future of the region, please do join us as a member now. You will get all our members-only editions and be able to comment under any Post story.
Last week we sent out two great stories to our members. On Tuesday we published Jack’s visit to the South Liverpool Debating Society, a group fighting back against tribalism and narrow-mindedness. At the back of Keith’s on Lark Lane they gather to discuss the most taboo topics over a pint and dinner.
On Thursday Mollie took a look at Sahir House, a sexual health charity which serves people across Merseyside with vital services from HIV support to counselling. The charity has been a bedrock to the LGBT+ community since the 1980s, but is now struggling financially after seeing a dramatic fall in funding. With the Monkeypox outbreak being declared a “public health emergency of international concern” by the World Health Organisation, it couldn’t have come at a worse time.
Stories like the weekend’s aren’t quick to put together. And we’ve got another investigative piece that Mollie and Harry have been working on for months coming up soon. It’s a cracker, so look forward to that, but it also means the resources of our small team are stretched to their limits.
If you know someone who you think would enjoy the work we produce, do consider sending on this email and spreading the word about The Post. The larger we become, the easier it’ll be to dedicate ample resources to these projects so they can have the depth and attention to detail they deserve.
This week’s weather
This week’s weather forecast is sourced from the Met Office and it’s for Liverpool.
The big story: How did homes deemed ‘worthless’ by the council end up in the hands of a Hong Kong billionaire?
Top line: A spate of Toxteth homes deemed worthless by Liverpool Council are now owned by Hong Kong billionaire Li Ka-shing and valued at £3.6 million, an investigation by the Sunday Times has revealed.
Hong Kong’s richest man: Li, or “Superman Li” as he is known in Hong Kong, seems like an unusual landlord to a collection of until-recently derelict Toxteth properties. He is one of the most influential people in Asia and his property fund CK Asset Holdings is valued at £21 billion. CK’s UK properties alone are worth £400 million. But how did he end up owning terraces in Toxteth?
Pathfinder: In the early-noughties Labour set up the Housing Market Renewal Initiative scheme — also known as Pathfinder — where the government paid councils to acquire and knock down old houses and build new ones. The scheme was ended after the financial crisis, by which point councils across Merseyside had purchased over 2,000 homes. According to the Sunday Times, they were crumbling and looked like a “war zone”.
£1 houses: Liverpool City Council’s solution to the problem was a pioneering scheme to give 120 crumbling homes away for £1 to residents under the proviso they would renovate them. Less publicly, other homes were given to developers, including dozens to West Tree Estates practically free of charge (only one of the nine fetched a meagre fee of £10,000), despite campaigning by local residents.
Zero to £3.6 million: West Tree renovated the homes making them multiple occupancy and suitable for adults who require special care. This might include special fittings in the bathrooms and various other aids. The values rocketed to £2.7 million in 18 months and were scooped up by Li. Each home was sold for between £250,000 and £300,000. Additional work since has bumped the total value even further to £3.6 million.
The council believes it gave the properties to West Tree on a shared-profit basis, entitling it to half of any increase in the value of the properties, minus development costs (known as an ‘uplift clause’). As of yet, it has received nothing at all. The Sunday Times reports that when asked about the failure to recover this money, it said that it was “seeking discussions with the developer concerning possible overage payment”. The article states:
“The real scandal is how a cash-strapped council has received nothing from these property deals.”
Liberal Democrat leader on the council Richard Kemp tells The Post he has put seven questions to the council, including whether the uplift has actually been checked. Kemp says:
“This relates to a time when the regeneration department was a bit like the wild west and all the necessary processes were thrown out of the window by cavaliers.”
Context: The number of Chinese and Hong buyers purchasing property in Liverpool has swelled in recent years, up by 170% between 2017 and 2021. A new survey by Beauchamp Estates found that around £8.75 billion of property, or about 35,000 homes, in Liverpool are linked to Chinese or Hong Kong residents.
A familiar (ish) tale : The other piece of necessary context is of course the 2020 report into council property deals carried about by Max Caller. Caller still casts a shadow over multifarious ongoings at Town Hall, and his presence looms large here. The report looked at over 65 property deals and — according to then-housing secretary Robert Jenrick — taxpayers had lost out over repeated council “failure[s] to correctly value land and assets”. In this case it seems less like an issue of valuation, and more one of keeping track of a clause in the original deal.
Kemp says he is “confident mechanisms are now in place to avoid this happening again,” but adds: “though you can never be certain in a place like Liverpool.”
Your Post briefing
🚌 Political leaders including Mayor Joanne Anderson and Metro Mayor Steve Rotheram have signed a letter calling for an end to strike action by staff at Arriva North West. According to the letter — which is backed by five council leaders and 14 MPs — the action is “hitting people hard”. Arriva staff walked out on 20 July indefinitely in a dispute over pay which has gone on for three weeks with no sign of resolution. "People are missing appointments, struggling to get to work, to see loved ones and choosing to not visit some of our great attractions that our visitor economy has to offer,” said the letter. They also criticised the company’s management for its “lack of urgency” in bringing the dispute to a conclusion.
👨⚖️ Anthony Saunderson, a drug kingpin from Formby, is one of nine people who have been jailed for supplying amphetamines on an “industrial scale” across the UK. In 2020 investigators hacked Encrochat — a messaging service used by criminals across the globe — to unveil a plot to supply £6 million of class A and B drugs in a three month period that year. Saunderson referred to himself as “Jesse Pinkman” on Enrochat in reference to the drug dealing character from TV show Breaking Bad and has been sentenced to 35 years at Liverpool Crown Court.
👩🎤 Liverpool has been named on the seven city shortlist to host the UK’s first Eurovision song contest in 25 years. It’s news you’ve likely already seen, with many people excitedly talking up the city’s bid in the belief that its musical heritage makes it a perfect fit for Eurovision. Metro Mayor Steve Rotheram echoed this sentiment by saying: “Liverpool wouldn’t be Liverpool without music — and music wouldn’t be music without Liverpool.” The bookies currently have Liverpool as underdogs though, only the fifth most likely of the seven at 12/1 with William Hill, behind Leeds, Manchester, Birmingham and favourites Glasgow. The BBC says a final decision will be made in the autumn.
🚆 Merseyrail will run a severely limited service on Thursday and Saturday this week due to two 24 hours strikes planned by the RMT union. An hourly service will still run calling at selected stations on each line between 07:30 and 18:30 in order for passengers to make essential journeys. Click here for a full summary of which lines will be shut down.
🕉️ A giant, one-and-a-half football pitch sized mandala has been cut into Knowsley's Halewood Park, as part of the borough’s year as Liverpool City Region Borough of Culture. The artwork is only temporary, but its creator — James Brunt — has said he hopes it will “inspire people” and leave “a legacy”. The BBC explains that the mandala refers to “a circle in the ancient Sanskrit language” and represents “the universe in Hinduism and Buddhism”. It is used in various ways, including sacred rites, meditation and henna designs. The mandala will be visible for around four weeks before wearing away naturally.
Home of the week
This idyllic two bedroom lodge in Churchtown, Southport is on the market for £385,000. The property backs onto the beautiful Botanic Gardens, also known as Southport’s “Jewel in the Crown”, which have featured on BBC’s Gardener's World.
Post Picks
🎵 Anyone keen to “groove and grind” should head to the vinyl record fair at the Bombed Out Church from noon on Friday. The garden bar will be open and the resident DJ will be there to set the vibe. No ticket required.
🎞️ On Thursday, FACT Liverpool is hosting a filmmaking masterclass with guidance from director Daniel Draper, whose recent film Manifesto follows Liverpool’s socialist activists on the campaign trail for Jeremy Corbyn in 2019. Tickets are only £5.
🥁 The Caribbean Music Festival is returning to Liverpool next Saturday with Reggae, Dub, Dancehall, Soca, Kompa and Latin music, and artists from Guadeloupe, Cuba, Jamaica and Montserrat. Booking soon is advised as the event is expected to sell out.
🚶 Meet the boys — Jim, Topaz and Mally — three beautiful alpacas who can be booked to go walking with at Walton Hall and Gardens this week. No dogs though, alpacas don’t like dogs, apparently. Tickets are still available for Wednesday and Thursday.
Photo of the week
Our favourite reads
One of several points raised in our weekend read was about how Liverpool has failed to capitalise on the cluster of gaming and interactive entertainment companies it has sitting on its doorstep. Here's a great deep dive from Liverpolitan last year exploring this point further, and arguing that the city could and should be promoted as the UK’s “capital of computer games”. “Imagine seeing SONY INTERACTIVE ENTERTAINMENT EUROPE lit up in big illuminated letters from your ship on the Mersey,” writes Mark Butler. “That would be a big sign, pun intended, that Liverpool is a city of the future.”
The founders of Lost Art — an independent Liverpool skatewear shop — discuss rising rents on Bold Street and scouse style in this interview in The Face. “Lost Art is a brand with history, local pride and a defiant outlook; moving with the times and never staying down despite some serious blows along the way. Mackey and his Lost Art family have completely flouted what it means to run a successful store in today’s climate, keeping the pace as one of Liverpool’s most vital exports over the last two decades.”
Ronnie Hughes’ latest piece on his site A Sense of Place is about his “Mount Street” walk. His writing blends descriptions of Liverpool’s physical geography with lived experience and memory, in this case guiding us through the area around Mount Street and down the hill into town. He recalls living with his first girlfriend in a Falkner Street flat once owned by John and Cynthia Lennon and the old Blake’s Cars Showrooms — now a Chinese restaurant — where his dad picked up a dark blue Ford Cortina in 1963. Here’s a taster: “Across Hope Street there are lifetimes of memories at either end. The lamented Ev Bistro, of course, and beyond it the Catholic Cathedral and being an altar boy there back in ‘67 when it opened.”
The Echo published a piece looking at the front line of the cost of living crisis. Political editor Liam Thorp visits a Sunday morning breakfast club at Charles Thompson's Mission support centre in Wirral, where he meets John, a formerly homeless man who recently suffered a double heart attack. John says: "I'm really worried about the winter, all I've got to get me through is a little electric heater. Something will have to go and it will be the heating, if I want to be able to eat. It's not good when I'm already not well.” Several of the people featured in the piece are almost entirely reliant on food banks and breakfast clubs to eat.
Letters from readers
Thanks for a challenging and thoughtful article even if it was an uncomfortable read for someone who committed a significant chunk of his life trying to secure and retain investment in Liverpool. Successful economic development in the City region has always felt like “three steps forward and one step back” rather than the smooth, continuous process we’d all like it to be. But we should recognise that three forwards and one back still constitutes progress. That’s not complacency; it’s a recognition that economic growth is never a linear process but one that responds erratically and sometimes unpredictability to macroeconomic and political forces and stimuli not always in our control. (‘Why are companies leaving Liverpool?’), Jack Stopforth
Great article Jack. Really well written and very funny. So pleased you could come to the debate and hope you and Mollie can come again soon. (‘Liverpool, Ukraine and the fine art of debate’), Ming-Ko
A city that is home to the oldest Chinese community in Europe, twinned with Shanghai, the largest city by population in China, made £90 million in tuition fees alone from Chinese students last year and the number of fans of Liverpool FC in China has just over taken that of Manchester United, so no one should be surprised to hear 39,000 homes in the city Liverpool were under Chinese ownership. Li Ka-sing the billionaire owns properties and businesses all over the world and the properties in Liverpool he acquired were from the local developer West Tree that have been thoroughly modernised and refurbished and the initial profits went to the developer and not Mr. Li. Sad to see, under the influence of the current government initiated Sinophbia movement the article is making it looked as if a crime have been committed (by the Chinese). Those in the city council were not smart enough to notice the sign of the tide was turning in Liverpool's favour when they gave those properties to West Tree. Let me explain.
Since the early 80s, because of the political turmoil in Liverpool, a lot of Chinese investors at home and abroad, relocated to Manchester and contributed to the region's phenomenal growth and prosperity in the years that followed. In the last five years we began to see some the fruits of investments from Manchester trickling back to Liverpool, from large entities like Peel Port's Liverpool 2 to many other smaller businesses and the number of students coming to Liverpool university from China and Hong Kong are also on the rise and so are the investors. There are reasons for this happening, one is the changing political climate conjured up by Whitehall that is souring relations between the Manchester city council and some overseas commercial establishments. Also, most Chinese people prefer to live in places next to a river and/or an estuary like Liverpool and landlocked Manchester even with its ship canal simply is not as desirable. Besides, (not a lot of people know this) Manchester is twinned with China's now-world-famous-for-all-the-wrong-reasons Wuhan.
In relation to the houses scandals I don't think the Sunday times mentions another Merseyside connection. The world's 30th richest man has taken a hit from his gamble on some of our local pubs. ('Hurrah' might say those whose decent neighbourhood boozer has gone down the pan in recent years.) https://www.thetimes.co.uk/article/li-ka-shing-left-crying-into-his-beer-after-greene-king-suffers-big-loss-sj666sp83