Fire safety work could cost Unite £3m

Unite, the student accommodation provider, has warned that fire safety work on its properties in the wake of the Grenfell Tower fire could cost it up to £3m.

The firm said that aluminium composite material cladding samples from six of its 132 properties, including Concept Place in Leeds (pictured), submitted to the BRE for testing had failed.

More tests are being carried out, Unite said. In the event that cladding needs to be replaced in the affected properties, it estimated that around 600 beds would have to be closed for the coming academic year, leading to an earnings hit of between £0.5m and £1m.

The additional cost of any remedial work would be between £1m and £2m, it added. Unite said it would not be recognising a financial provision in its half year results.

Unite revealed the costs in its half year results, which showed revenues for the six months to 30 June down 1% at £62.7m. The firm returned £28.8m from operating activities, up 3%, while its pre-tax profit was £83.9m, due to valuation gains on property and share of joint venture profit. This was down 32% on the previous year.

The firm said its properties had been designed“to meet stringent fire safety requirements and have life safety systems installed that match the individual requirements of each building.

“This may include but will not be limited to alarm systems, sprinklers, dry/wet risers and automatic smoke ventilation,” Unite explained.