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Building managers can, from today, use a new edition of the form designed to record what assessment has been carried out for the external wall construction of residential apartment buildings of 18m and over, or buildings where a specific concern exists.
A link to the new form and other useful guidance can be found at the foot of this article.
The original edition was borne of Barclays Bank with other lenders, to bring some consistency to the information lenders could use when making lending decisions. The new form, a co-operative effort of numerous stakeholders including IRPM, contains a big change. In bold text at the top of the new form, there are words telling lenders and buyers that they cannot rely on this form. Only the building owner/manager can. So, what’s the point of this new form?
Answer: Lenders will rely on it anyway. Probably. Here’s the ‘how and why’… If a fire risk assessor signs a form saying the external wall system (that’s the cladding, insulation, membranes, fixings, etc.) is checked and safe, that assessor is providing an opinion to the building owner. But under the law of tort, that assessor could end up liable to any third party who relies on the report, for example, a buyer or their lender. Suddenly, that assessor is liable not just to the building owner but to potentially dozens, even hundreds of lenders and buyers. Already, the risk of doing numerous EWS assessments has caused assessors’ indemnity insurance premiums to skyrocket, or even be withdrawn altogether. If the assessors can’t get PI insurance, buildings can’t be assessed and the whole sales process for buildings with cladding goes into lock, which it pretty much is already, with sales falling through as valuers “zero-value” flats in buildings with suspect or unknown wall systems.
The answer is for assessors to disclaim liability to everyone but the building owner/manager who commissioned the report. Then, it’s up to mortgage lenders to decide if they want to risk relying on a report and lend anyway. The mood music among lenders is pragmatic at the moment and it seems likely at least some will do this.
Also new is the form makes the assessor choose either Option A or Option B. Option A is where external wall materials are unlikely to support combustion, Option B is where combustible materials are present in the external wall.
For Option A, a suitable professional (sadly, undefined) with expertise to comment on materials and construction can complete the form. For Option B, the standard rises and the person signing the form should be a member of a relevant professional body that deals with fire safety in the built environment. This could be a Chartered Engineer with the Institution of Fire Engineers or equivalent.
Whichever option is used, a physical and likely invasive inspection will be almost always be required. A desktop exercise will not be sufficient. The report says “the investigation must include evidence of the fire performance of the actual materials installed. For both Options A and B this would often include either a physical inspection by the signatory to this form, or inspection of photographic or similar information gathered by a 3rd party (subject to the signatory having sufficient confidence in that 3rd party). It would also include the standards of construction of key fire safety installations such as cavity barriers. Given the nature of external walls this would typically involve investigations in a limited number of locations (actual number to be determined by the signatory). Review of design drawings may assist but on their own would not be sufficient. If the wall construction includes multiple wall types, the investigation should include each type.”
This form should help safe buildings to be recorded in a way that will free up mortgage lending and get people moving again. However, there is a big “however”. What the form will not do is remediate unsafe buildings and dealing with that is the biggest challenge coming our way in 2020. Presently, we are hearing that too many buildings are failing their inspections. That is certainly the experience of Housing Associations who are surveying all their buildings and the private sector is gaining more experience of the same results every week.
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