A High Court judgment has ruled that the fund which owns Beetham Tower needs to carry out urgent work to replace sealant around a number of the 47-storey building’s glass panels, and pay costs and damages to leaseholder the Hilton Hotel.
Blue Manchester, trading as Hilton Manchester Deansgate, brought the claim against North West Ground Rents, a fund owned by Ground Rents Income Fund and managed by Brooks Macdonald.
The claim relates to the failure of sealant around some of the 1,350 shadow box units which form part of the tower’s façade, and a question of whether remediation work has kept the building in good repair.
In a statement to the stock market, Ground Rents Income Fund revealed that the court had found in favour of the Hilton, and ruled “the building is in disrepair”.
The sealant issue on Beetham Tower has been known for some time. Contractor Carillion and façade contractor Bug completed urgent safety work on the panels in 2014, and Carillion was in the process of an investigation and assessment for further work when the contractor went into administration at the start of last year.
The High Court has ruled that a permanent solution needs to be found within 18 months. The fund was ordered to pay the Hilton £250,000 in costs, with the final amount to be determined at a later date.
In addition, the Hilton is entitled to damages for the 31 months while hoardings have been in place in connection with the façade investigation. The court ruled that hoardings should be removed within one month.
The Hilton is also entitled to further damages due to dirty water being released into the water supply “due to lack of maintenance”, and the Hilton is to be paid two-thirds of its costs for bringing an injunction over the water supply issues. Costs will be decided at a later date.
In its annual report at the end of 2018, North West Ground Rents predicted that it did not have liability over the façade issue, and no irrecoverable losses were likely to arise. However, it did write down the building’s value “to reflect the influence of the legal action and uncertainty of its outcome”.
North West Ground Rent said that it now may pursue proceedings issued against the insurers of Carillion, now bust, and the sub-contractor. The Hilton has also started action against Carillion’s insurers and subcontractor.
According to the fund, the trial was limited to the issue of who was responsible for carrying out remediation works, but not quantifying the costs of the work. The fund said it was “seeking advice on the nature of the remedial works required to comply with the judgment and their associated cost”.
Beetham Tower was designed by architect SimpsonHaugh, and was completed in 2006.
Brooks Macdonald has been approached for comment. SimpsonHaugh declined to comment.