A London council’s fight against unfit rented housing has resulted in a single landlord being forced to submit 140 applications to prove his apartments are lawful accommodation.
The extent of the continuing four-year battle between Islington council and Andrew Panayi, a multimillionaire landlord who owns 200 flats around Caledonian Road in north London, has been revealed by officials who told the Guardian that in one year they discovered 90 of his flats did not have adequate planning permission.
Islington estimates investigations and official challenges to Panayi’s practices have cost council tax payers at least £170,000, with some cases taking up to two years to resolve. For a period of time one council planning officer was assigned no other work apart from investigating the landlord, it said.
“There are literally hundreds of files [on Panayi],” said Karen Sullivan, Islington’s planning director. “There is no one else at this scale.”
The town hall’s investigation into Panayi’s rental empire has seen him served with enforcement notices on more than two dozen bedsits – described by one tenant as “worse than prison cells” – that were ruled unfit for use because they were too small. Since the beginning of 2015 he has been successfully prosecuted twice for failing to respond to contravention and enforcement notices on rental properties. He is due to appear in court in February for sentencing in a third case after he refused to demolish an unauthorised roof extension in which he had built two rental flats.
But Panayi, 69, a former insolvency practitioner, has hit back at his treatment by the council, telling the Guardian it amounts to “victimisation”. In an image that suggests he thinks Islington considers him like a vampire, he said the council “brings out the crucifix when they hear my name”.
But Panayi has also won many of his battles with the council. Ninety-six of the 140 planning applications he has had to submit to prove his apartments are lawful have been successful and he has won 13 appeals against some of those that were refused.
He believes he is misunderstood and claims to have pioneered low-cost housing in the area in the 1980s by turning large single houses into multiple flats.
“The services I have provided on the Caledonian Road have been so great that they should not be coming after me, they should be giving me a prize,” he said. “It has a lot to do with the fact that I have been so successful. They just can’t accept it.
This month alone Panayi had three planning appeals rejected and the reasons given reveal two key reasons why officials have been objecting to his approach to housing on an almost industrial scale. In one case he wanted to split two flats into four by building an extension, but the government’s planning inspector ruled three of them were significantly smaller than minimum space standards, would be “cramped” and would fail to provide acceptable living conditions. In another case, it emerged that Panayi did not want to provide a £50,000 payment towards affordable housing, as demanded by the borough.
Since 2014 he has been convicted, and had to repay £70,000 under the Proceeds of Crime Act, for letting out a storage basement as self-contained accommodation for £975 a month after it was declared substandard. In 2014 Islington sent in health and safety inspectors after it emerged he was trying to rent out a studio apartment that consisted of a small room into which had been crammed a double mattress, a wardrobe and some kitchen units, leaving just enough room to open the front door or walk round the bed, plus a separate toilet and shower.
Panayi’s notoriety grew when he appeared in a 2012 BBC documentary, The Secret History of Our Streets, in which he spoke about “milking” tenants and boasted he “builds first and asks permission later”.
By 2014 Panayi had acquired 250 rental properties which delivered him a multimillion-pound annual income. Local residents, who branded themselves the Cally Cows in reference to his “milking” quote, were furious at his tactics and councillors decided to act.
“When the programme aired there was national outrage,” said Andrew Marx, Islington’s deputy head of planning. “People from Manchester were asking, ‘What are you doing down there?’ It was a huge thing for us as a council wanting to care about people having decent accommodation. Four years later we are still pursuing this, which shows we are not going to stop.”
Councillor Diarmaid Ward, Islington council’s executive member for housing and development, said: “More and more people in Islington are renting privately, and they need decent homes to live in. It’s also important that public confidence in the planning system is not undermined by people who flout planning controls. Most landlords in Islington act fairly and lawfully, but if landlords ignore planning rules we will take action, especially if landlords break the rules repeatedly.”