Reports of children who are frightened to go home and can’t sleep at night because they are “petrified”; concerns about the potential for grooming of vulnerable adults and youngsters; suspected drug dealing; alcohol-fuelled bad behaviour; incidents of domestic abuse … Harlow in Essex is being left to pick up the pieces because London councils are “socially cleansing” their boroughs and sending hundreds of vulnerable and troubled people to live in converted office blocks in the town.

That is the claim from some politicians and officials in Harlow, which appears to have become a flashpoint for a government policy that allows developers to cram huge numbers of “rabbit hutch” flats into unused office buildings without planning permission.

Harlow was built after the second world war to ease overcrowding in the capital. Seventy years on, some locals claim the town has become a “dumping ground” for people on London council waiting lists.

Harlow’s Conservative MP Robert Halfon said recently that the office-to-residential boom has been “a disaster”, as London councils have “socially cleansed” their residents and sent hundreds of “troubled families” to his constituency.

There is clearly money to be made. Guardian Money can reveal that one of the companies apparently making a fortune in rental income from two of the biggest office-to-residential conversions in Harlow, and a string of other developments in the south of England, is Croydon-based property group Caridon.

This is the same group behind plans to squeeze 26 studio flats into a building on an industrial estate in Balham, south London, which Money featured on 2 March in an article headlined “Will these be the worst new ‘rabbit hutch’ flats in Britain?”.

According to its website, Caridon is run by Mario Carrozzo, who has “generated a self-made property portfolio worth in excess of £100m”. The group says its goal is “to maximise return on investment while helping to ease the housing crisis with bespoke, inexpensive, modern accommodation for those with challenging requirements”.

Planning documents indicate some of its flats are less than half the recommended minimum floor area for a new home. However, the company told us: “The homes are not intended as a permanent living solution, with tenants typically staying 12 months, and by making them compact we can help house more people.” It adds that it invests significantly in its residents’ wellbeing.

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It was only in May 2013 that ministers changed the rules so that offices could be turned into housing without planning permission – but this policy has already had a huge impact on towns such as Harlow and Crawley in West Sussex.

In Harlow the council has identified 13 office blocks that have been converted, resulting in more than 1,000 individual flats. While on the face of it that might sound like a good thing when the UK is arguably not building nearly enough homes, some of these flats are very small, and the majority are located in industrial areas, which can throw up problems with access to public transport, schools, health services and shops, as well as road safety dangers and air quality.

About 40% of the 1,000-plus flats in Harlow are owned and managed by Caridon, whose latest big development in the town is Terminus House, a nine-storey 1960s office building that sits on top of a multistorey car park. This has been converted into more than 200 flats and opened its doors to its first tenants last April. The company also owns two-storey Templefields House, which according to Harlow council now contains 180 flats, and houses a mixture of social and private tenants.

Planning documents indicate that some of the Templefields House flats measure as little as 18 sq metres. National space standards state that the minimum floor area for a new one-bedroom one-person home (including conversions) is 37 sq metres. However, these minimum sizes are not compulsory.

One resident living at Templefields House with her partner and two children told the EssexLive news website in May 2018 that she “struggles” to live in the “tiny” flat, adding: “My bed is in my living area… [My son’s] bed is in my kitchen area and my daughter’s cot is in the living area.” She said she had to pull her son out of nursery as it was too far away, adding: “There is a very busy road nearby. Huge lorries come rushing down.”

Among those objecting to the Templefields House conversion was Harlow Civic Society, which argued that as an industrial area this was a “totally inappropriate” location for people to live, adding: “There are no facilities nearby that are essential for civilised family life.”

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Both Terminus and Templefields were allowed to go ahead. Under so-called “permitted development rights” (PDR), office-to-residential conversions don’t require the permission of the local planning authority.

A Harlow council report stated: “It is evident that properties ripe for this type of development are cheaper to purchase in some parts of Essex than in London, and it provides London boroughs and other councils with something of a solution to the ever-increasing demand for temporary and other types of accommodation in their own areas.”

It added that “the negative impact on families placed out-of-area can be huge”, with people left feeling “isolated and unsupported”, and potentially exposed to antisocial and criminal behaviour.

Mark Ingall, Harlow council’s Labour leader, told Money that it is “a disgrace” that London boroughs are packing their families off to Harlow and using “often unsuitable” converted office blocks in the town to deal with their housing shortages.

“These already vulnerable families are … being forced to live miles away from their communities, their families and friends and where they work or where their children go to school. The London boroughs that make that decision and the government who created the permitted development rules could stop this now,” he says.

A Harlow council report published last October said concerns had been reported about families with children being housed in converted offices. While not yet fully substantiated, these included a high volume of calls to Essex police, suspected drug-dealing and drug use, incidents of domestic abuse resulting in the police being called, and “lone males hanging around the site leading to concerns about the potential for grooming of vulnerable adults and children”.

It added: “Some resident children attending Harlow schools have apparently told school staff they are frightened to go home and are unable to sleep at night due to being petrified.”

So what do we know about the Caridon group? On its website it says it is projected to increase its property portfolio to 5,000 residential units by 2020. The latest accounts for Caridon Holdings, for the year ending 31 March 2018, lists a string of sites described as investment properties, including the two Harlow developments.

There are also several sites in Crawley, including Ashburn House (for which floor plans suggest that some flats are as small as 15 sq metres), Maplehurst House, Sutherland House and Central House.

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The accounts state that the 2018 value of the investment properties was £113m, and that the profit for the year – also expressed as total comprehensive income – was £11.2m.

Caridon Property said: “Working in partnership with charities and local authorities such as Harlow council, we provide affordable and social rent accommodation to individuals and families on low incomes and in difficult circumstances … The majority of our residents in Harlow are originally from the area.”

It added: “While we are a profit-making business, we invest significantly in our residents’ wellbeing by hosting regular community events and creating new facilities … We collaborate extensively with organisations such as the Citizens Advice Bureau, Harlowsave [credit union] and Rainbow Services … Caridon Group also has a charitable foundation whose sole aim is to help our residents better their situation.”

Caridon said the Harlow council report was “several months old” and included claims the report admitted were not wholly substantiated. “Our building managers have never had any dealings with the police concerning some of the serious crimes listed, including the grooming of children.”

It also said: “The financial information listed also refers to the wider Caridon Group and not Caridon Property, the company that operates both buildings [in Harlow].”

Caridon said the company had offered the Guardian guided tours and interviews with tenants. It put us in touch with two current Templefields House tenants and two ex-tenants, all of whom spoke positively about the building and Caridon.

One of them, Susannah Gladwin, who lives in a Templefields House flat with her partner, daughter, six, and son, two, told us: “To be fair, I think it’s perfectly safe … there are massive security gates, and you have to have a key fob to get in.” She said that when she moved in just over two years ago, “there was quite a bit of dramas going on”, but since then there has been new management. “Everything has completely changed, and there’s been no trouble at all – my daughter doesn’t feel scared any more.”



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