DEFECTIVE APARTMENTS To Cost TAXPAYERS $6 BILLION

We agree with this Commentator …

‘The government could impose personal liability and criminal penalty on the directors of development and building companies, then the flammable cladding problem will ‘magically’ solve itself .

They won’t do that though … ‘

Defective apartments to cost taxpayers $6 billion

By Unconventional Economist in Australian Property

November 5, 2019 | 7 comments

new report from Equity Economics warns that the cost to taxpayers from apartment faults and flammable cladding could surpass $6 billion:

The report, set to be released on Tuesday, estimated the overall national cost of apartment defects, including flammable cladding, to be upwards of $6 billion and called for a harmonisation of state laws. The report put the onus on Canberra to bring the states into line and use the billions of dollars in federal infrastructure funding as leverage to ensure better compliance…

“Unfortunately, though, [the federal government] has applied this leverage to advance an ideological agenda,” the report said.

But Federal Industry Minister Karen Andrews said the federal government didn’t have the constitutional power to act. She said the states were already working together to develop a consistent approach to implementing the recommendations of the Shergold-Weir Building Confidence report…

The CFMEU report took aim at a decades-long strategy by the states to handball big infrastructure projects to the private sector to reduce risk, which it said had slowly diminished government’s institutional knowledge and expertise.

It described the National Construction Code as an effective framework which was being applied inconsistently at a state level rendering it “defunct”…

The blame for the flammable cladding crisis runs deep and wide, including dodgy certifiers and fraudulent certificates, phoenixing building companies and lax regulators.

Australia’s mass immigration ‘Big Australia’ policy has also facilitated the crisis. With cities like Sydney’s and Melbourne’s populations growing at third-world rates, lots of dwellings need to be built very quickly. This inevitably means that build quality is compromised.

*The proliferation of shoddy high-rise will continue as Sydney’s and Melbourne’s populations balloon to a projected 10 million each in around 50 years:

Such manic immigration-fuelled population growth will necessarily require the rapid construction of high-rise shoe boxes, resulting in compromised quality.

The only way to truly fix the problems in the construction industry is to conduct a ‘warts-and-all’ royal commission and cut immigration. No more band-aid solutions.

SOURCE: https://www.macrobusiness.com.au/2019/11/defective-apartments-to-cost-taxpayers-6-billion/

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Apartment defects turns insurance crisis

Apartment defects turns insurance crisis

GOOD isn’t it? It looks like defective construction is starting to backfire on the perpetrators … and commercial interests will weed out the badies.

Shouldn’t it be the developers and the banks that need to solve this?

Apartment defects turns insurance crisis

By Houses and Holes in Australian Property

November 1, 2019 | 6 comments

Via The Australian:

Construction projects worth billions of dollars could grind to a halt as hikes to professional indemnity insurance premiums begin to force building certifiers out of business in what the industry warns is a “national crisis”.

One of Queensland’s biggest certifiers, GMA Certification Group, declared on Thursday it was “dead in the water” following a rise of 200-300 per cent in professional indemnity premiums.

JMG Building Surveyors chief executive John Massey, who wrote to Scott Morrison in July to warn the construction industry was on the brink of the “collapse”, described GMA’s imminent closure as “unfathomable”.

The crisis was triggered by London’s Grenfell tower inferno and a similar firestorm at the Lacrosse apartment building at Melbourne’s Docklands in 2014.

Construction defects, which led to the evacuation of three Sydney apartment blocks, also put pressure on the industry.

It’s a play book, really. Let it run into outright crisis then demand the tax payer pick up the tab.

Just another mass immigration growth model outrage as the profits are privatised while the costs are socialised.

Meanwhile, goodbye:

Until the tax payer catches it right in the team.

photo: The Australian

SOURCE: https://www.macrobusiness.com.au/2019/11/apartment-defects-turns-insurance-crisis/

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BUYER BEWARE: Building Tsar’s Warning over Faulty Units

IT would appear that Mr Chandler has not yet made any official recommendations on the historical defects problem … is that because there are just so many of them?

… however he has on the issue of flammable cladding.

Buyer beware: Building tsar’s warning over faulty units

The man hand-picked by the Berejiklian government to tackle Sydney’s defective apartment crisis has declared regular homebuyers need to take more responsibility for inspections and adopt a “buyer beware” mindset. 

Anna Caldwell, State Political Editor, The Daily Telegraph|

October 29, 2019

AAP1:30What went wrong at Opal Tower

February 22, 2019. UNSW’s Professor Mark Hoffman speaks to reporters in Sydney alongside Minister for Planning and Housi…

The man hand-picked by the Berejiklian government to tackle Sydney’s defective apartment crisis has declared regular homebuyers need to take more responsibility for inspections and adopt a “buyer beware” mindset. 

Building Commissioner David Chandler made the remarks as he revealed he has identified another 200-apartment building last week which had “significant issues” and was “incomplete” despite being certified for occupancy, and that there were “at least another two” buildings like it.

Building Commissioner Mr David Chandler OAM. Picture: Richard Dobson
Building Commissioner Mr David Chandler OAM. Picture: Richard Dobson

Mr Chandler was appointed this year to restore confidence in the building and construction industry after hundreds of people had to be evacuated from defective or risky apartments in the Mascot and Opal Towers and other buildings were identified as unfit for occupancy.

Mr Chandler said last night under a state parliament estimates grilling that people “should go and spend a little bit more time having a look (at their apartment) before they settle”.

He said one of his priorities was to find a way to tackle the defective building problems from “the front end” rather than waiting for owners to move into bad apartments.

*He also conceded he had not yet made any official recommendations on the historical defects problem, but had on the issue of flammable cladding.

*Mr Chandler told the hearing he would “be quite confident to buy an off the plan apartment” in Sydney “if people were prepared to do a little bit of research to work out who might be risky and who’s less risky”.

Mascot Towers occupants were evacuated due to structural concerns within two of the tower buildings in the four tower complex. Picture by Damian Shaw
Mascot Towers occupants were evacuated due to structural concerns within two of the tower buildings in the four tower complex. Picture by Damian Shaw

He said “there are 60 or 70 per cent of developers building an entirely high quality product”.

The comments were described as “remarkable” by Labor MP Courtney Houssos who pursued Mr Chandler with relentless questions, asking him if his “advice is that homeowners become experts themselves?” and whether there was a role for government to regulate.

Mr Chandler said there was a “role for everyone to do what would be appropriate”.

“If I was in the market for a $750,000 apartment I would certainly be looking at who was the builder and I would certainly be wanting to have a better look at the apartment and the building before I settled,” he said.

“We can risk assess the market and we can get out and look at complaints but everyone should have a hand in a little bit of buyer beware.”

Opal Tower.
Opal Tower.
New South Wales Premier Gladys Berejiklian. Picture: Dean Lewins
New South Wales Premier Gladys Berejiklian. Picture: Dean Lewins

Ms Houssos said that Mr Chandler’s implication was that owners in places like Mascot Towers had not done their due diligence but Mr Chandler said he wouldn’t testify on whether those owners had done due diligence.

Mr Chandler said that of the project he’d visited last week, of the 200 people who had settled “only one owner took it upon themselves to inspect the property and that party refused to settle”.

A government spokesman last night confirmed the building in question was currently occupied and did not require evacuation, but would not reveal its location.

Labor MP Daniel Mookhey said: “I would have thought the consumer in NSW would expect the government to regulate so that the product served up (is acceptable)”.

SOURCE: https://www.dailytelegraph.com.au/news/nsw/building-commissioner-points-finger-at-buyers/news-story/d2a209e3803d437d447b5bd32f40140a

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Opal Tower owners corporation back NSW Building Commissioner comments

BUILDING COMMISSIONER DAVID CHANDLER warned that homebuyers should take it upon themselves to inspect apartments before they settle and adopt a “buyer beware” mindset.

IT is evident that Mr Chandler’s comments come as a consequence of the malaise of this industry, the evidence amassed over many years of defective construction and defective building materials used in housing/high-rise projects

With the industry having been deregulated, with the loss of Standards, the importation of defective building materials and Visa Workers, home buyers have been rendered no guarantees apart from self inspection and investigation … what has it come to in NSW INC?

Opal Tower owners corporation back NSW Building Commissioner comments

The owner’s corporation chair of Opal Tower has backed contentious comments from the Building Commissioner, saying in a perfect world consumers should not have to inspect buildings but until the industry changes it’s every man for himself.

Danielle Le Messurier, Anna Caldwell, Exclusive, The Daily Telegraph

October 29, 2019

AAP4:17New powers to tackle shoddy building work

October 23, 2019. NSW Minister for Better Regulation Kevin Anderson speaking to media at state parliament about new legi…

The owner’s corporation chair of Opal Tower has backed controversial comments by the state’s Building Commissioner, saying in a perfect world consumers should not have to inspect buildings but until the industry changes “it’s buyer beware”.

Shady Eskander said while the state government should be protecting homebuyers who have “no way” of peering behind the walls of brand new high-rise towers, consumers must do what they can to protect themselves until legislation is overhauled.

“Definitely I agree it’s not our job to know (about defects) but until the industry gets their act together and fixes the market, of course I’m going to beware,” Mr Eskander said.

Opal Tower owner’s corporation: Nick Cubbin
Opal Tower owner’s corporation: Nick Cubbin

“If you’ve got the Building Commissioner telling you yourself be careful – that is the fairest thing to say. He’d be lying if he said don’t worry, the government is going to get this right.”

It comes after Building Commissioner David Chandler was criticised at a budget estimates hearing on Monday for saying homebuyers should take it upon themselves to inspect apartments before they settle and adopt a “buyer beware” mindset.

“If I was in the market for a $750,000 apartment I would certainly be looking at who was the builder and I would certainly be wanting to have a better look at the apartment and the building before I settled,” he said.

Building Commissioner David Chandler has come under fire over controversial comments at a budget estimates hearing. Picture: Richard Dobson
Building Commissioner David Chandler has come under fire over controversial comments at a budget estimates hearing. Picture: Richard Dobson

Labor MP Courtney Houssos described Mr Chandler’s comments as “remarkable” while colleague Daniel Mookhey said he believed the average consumer would expect the government to regulate to ensure the product served up is acceptable.

Opal Tower in Sydney Olympic Park was evacuated on Christmas Eve when cracks appeared in the brand-new 392-unit high-rise.

Residents from 22 apartment are still unable to return due to ongoing remediation work.

Owners have launched a class action against the state government’s Sydney Olympic Park Authority – which owns the land on which Opal Tower sits – for losses incurred as a result of damage from defects.

The majority of owners in Opal Tower have launched a class-action lawsuit against the state government, which owns the land the high-rise sits on. Picture: AAP
The majority of owners in Opal Tower have launched a class-action lawsuit against the state government, which owns the land the high-rise sits on. Picture: AAP

It’s understood the total value of sales in the 36-storey tower was approximately $350 million and the claim could be around that figure.

Mr Eskander, who purchased his unit off-the-plan, advised homebuyers to avoid purchasing an apartment built in the last five years and know what they are buying.

“It is not our role to go and ensure the correct concrete strength was applied, the correct amount of steel reinforcement was therewhat are we paying for at the end of the day if we’re doing all of that?” he said.

Former Planning Minister Anthony Roberts and Chairman of the Opal Tower body corporate Shady Eskander speak to the media during a press conference in Sydney. Picture: AAP
Former Planning Minister Anthony Roberts and Chairman of the Opal Tower body corporate Shady Eskander speak to the media during a press conference in Sydney. Picture: AAP

“It is not our job but until the government realises they have to change this industry 100 per cent buyers beware of buying off-the-plan apartments.”

Better Regulation Minister Kevin Anderson last week introduced a suite of reforms into parliament to tighten the state’s construction industry.

*They include new measures to make it easier for owners of defective apartments pursue damages and a new registration scheme for building practitioners.

*Lead researcher in the field of defective buildings Dr Nicole Johnston of Deakin University said that while it was true “everyone needs to be a little bit more conscious”, the most problematic defects are not observable.

A photo supplied to The Daily Telegraph shows cracks in the cement ceiling of level B1 of the Opal Tower in Homebush. Picture: Supplied
A photo supplied to The Daily Telegraph shows cracks in the cement ceiling of level B1 of the Opal Tower in Homebush. Picture: Supplied

She also said it was costly and time consuming to make checks on off-the-plan purchases and “no amount of due diligence can provide certainty that you are buying something safe”.

“There’s no way a potential purchaser would know the membrane applied to a wall will cause a systemic leak – they can’t see behind a wall, there’s only so much investigation they can do,” she said.

Labor spokeswoman for better regulation Yasmin Catley said it was “pretty obvious there has been a serious failure of regulation in the building industry and we need to immediately restore confidence.”

“Sending a buyer beware message demonstrates the total and utter incompetence of this Liberal National government.”

SOURCE: https://www.dailytelegraph.com.au/news/nsw/opal-tower-owners-corporation-back-nsw-building-commissioner-comments/news-story/1ced5078db352dd3837fabd39de21f74

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SYDNEY’s HIGH-RISE APARTMENT BUST DEEPENS

Image result for MORE ON The Opal Tower effect: Sydney high-rise site sales crash 50 per cent

FYI … ‘Given the two-plus year lag between high-rise approvals and completions, Sydney is facing an almighty construction bust that will likely run well into 2022.

VIEW THE COMMENTS … dodge a bullet!

Sydney’s high-rise apartment bust deepens

By Unconventional Economist in Australian Property

October 25, 2019 | 13 comments

Sales of residential development sites in Australia fell by 38% to $5.1 billion in 2018-19, according to Knight Frank.

This decline nationally was driven by Sydney, where site sales fell by 50% and average site values fell by 12%more than double the decline in Melbourne:

The slump – from $8.25 billion of sales recorded in fiscal 2018 – was led by Greater Sydney, where the value of sales of development sites suitable for high-density projects (25 or more apartments and more than four storeys) halved to $1.97 billion (out of a state total of $2.7 billion)…

Driving the 38 per cent national fall was reduced demand from overseas investors, especially in Sydney, where they accounted for just 11 per cent of total site sales. Across Sydney, average site values fell 12 per cent to $184,000 per apartment, more than double the fall in Melbourne…

The collapse in high-rise site sales and prices follows a similar-sized crash in approvals:

As shown above, NSW high-rise apartment approvals tanked by 38% over the year to August 2019, and have collapsed by 52% since peaking in September 2016.

Given the two-plus year lag between high-rise approvals and completions, Sydney is facing an almighty construction bust that will likely run well into 2022.

Image result for MORE ON The Opal Tower effect: Sydney high-rise site sales crash 50 per cent

SOURCE: https://www.macrobusiness.com.au/2019/10/sydneys-high-rise-apartment-bust-deepens/#comments

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APARTMENT OWNERS FEAR FOR ‘SUICIDAL’ NEIGHBOURS as COMBUSTIBLE CLADDING Crisis takes its Toll

KEY POINTS …

-information emerging about the scale of the potential financial costs of combustible cladding

the voices of the people impacted; their lived experience needs to be brought into the discussion

residents concerns about the range of other defects; lack of waterproofing and water ingress

laundry list of defects in apartments has caused residents emotional and financial stress

-zip consumer protection for home owners biggest expense

NSW not one cent from the state government to help property owners unlike Victoria

a problem created by bad government, by deregulation and privatisation

IS this the community price to be paid for political donations … bribes?

Apartment owners fear for ‘suicidal’ neighbours as combustible cladding crisis takes its toll

7.30 By Tracy Bowden and Kirsten Robb

23 OCTOBER 2019

An apartment building corridor with a danger construction site sign beside a door.

PHOTO: Reconstruction work inside a Melbourne apartment building damaged by a combustible cladding fire in 2018. (ABC News: James Oaten)

RELATED STORY: Majority of new apartments worth less than purchase price, data shows

RELATED STORY: Apartments could be the crack in the housing market recovery

RELATED STORY: Victoria’s $600m cladding fix ‘could risk a blowout’ and cost billions

Owners of apartments affected by the cladding crisis in Victoria have told researchers of the emotional toll it has taken on them.

Key points:

  • Apartment owners affected by combustible cladding are experiencing financial stress
  • Some apartments have been deemed almost uninsurable or the owners have seen massive increases in premiums
  • There are concerns some affected owners may be suicidal

To cope with the financial stress, some owners have delayed their retirement, while others have borrowed money to cover massive increases in insurance premiums.

Others have told of their concerns for neighbours who may be at risk of suicide because of the impact of the issue.

The information comes from research undertaken by the RMIT’s School of Property, Construction and Project Management, conducted by Dr Trivess Moore and Dr David Oswald.

If you or anyone you know needs help:

*”There is information emerging about the scale of the potential financial costs of combustible cladding,” Dr Moore told 7.30.

*”But what we haven’t yet heard is the social impact.

*”It’s not just the financial effect we need to address — we need to bring the voices of the people impacted and their lived experience into this discussion.

*”We have had reports from some of the interviewees that they are concerned that some neighbours they know may be suicidal because of this issue.”

*Dr Moore said residents also spoke of their concern about the range of other defects in apartments, including a lack of waterproofing and water ingress.

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‘Things need to change’

A man wearing a blue shirt points to a big crack in a retaining wall.

PHOTO: Craig Fitch is facing major repairs to the development his apartment is in. (ABC News: James Oaten)

Residents of a Frankston South building affected by combustible cladding said the issue, as well as a laundry list of other defects in their complex, had caused them major emotional and financial stress.

“I think this has probably been the worst 10 months of my life, putting up with this,” owner Kerry Ould told 7.30.

“You buy the biggest thing of your life and you have got zip consumer protection. Nothing.

“You have to fight.”

A legacy of defects

The apartment building crisis isn’t just a Sydney problem. How bad could it be in your state?

Another owner, Craig Fitch, decided to speak out about the flaws despite being aware that identifying his building could affect its resale value.

“Things need to change,” he said.

“Sometimes you need to think a little less about yourself and try and get an overall result for the whole of Victoria really.”

Mr Fitch and the other owners at the Frankston South complex will be among the first to benefit from a Victorian Government scheme which pays for the removal of combustible cladding on the building.

But they still face millions of dollars in repairs on other building defects and are now suing the builder to recover costs arising from the disastrous development.

“I’ve worked with lots and lots of good tradesmen and good builders and they shouldn’t be tarred with the same brush but they need to weed them out,” Mr Fitch said.

“The regulator just needs to get better and get rid of the rubbish out of the industry.”

Governments’ cladding responses mixed

Orange flames spread up a multi-storey apartment complex.

PHOTO: Cladding of a multi-storey Melbourne apartment complex on fire in February 2019. (Twitter: Bekah Jayne)

The Victorian government has put $600 million towards a project to identify and replace dangerous cladding and has vowed to pursue dodgy builders who installed it.

*Other states are less advanced, with concerns raised around the delay in action on the issue in NSW.

NSW Greens MP David Shoebridge has been particularly vocal.

“In New South Wales, there’s not one cent that’s come forward from the state government to help property owners,” he told 7.30.

*”There’s no public register, we don’t even have a set of guidelines to identify what property owners need to do to make their properties safe.

*”This is a problem created by bad government, by deregulation and privatisation. And that’s why I believe government has to be part of the solution.”

*Mr Shoebridge said the NSW government was refusing to make a register of affected buildings public.

“I find it astounding,” he said.

“We’re two and a half years post that tragedy in Grenfell and we still don’t have a public register in New South Wales, we still don’t have a comprehensive system to identify buildings at risk of flammable cladding.”

The NSW government has previously advised councils to cite a terror risk to keep flammable cladding locations secret from the public. Many owners also fear the potential hit to the value of their investment, if its cladding status is made public.

Residents in 37 apartment complexes across Sydney have been advised remediation work to remove some or all of the combustible cladding on their buildings will need to take place.

NSW Better Regulation Minister Kevin Anderson said the government was approaching this issue “practically and diligently”.

“We have prioritised high-rise residential buildings for assessment with local councils, who are making every effort to see assessments done as soon as possible,” he told 7.30 in a statement.

“Every day we clear more buildings and learn more about the buildings requiring remediation work.

“I want to make it clear, residents are not in any immediate danger as a result of living in one of these buildings. Extra fire safety measures have been put in place to protect residents until buildings can be cleared or remediated.”

‘There’s thousands of cases out there’

Roscon general manager Sahil Bhasin stands in front of an apartment building with his hands in his pockets.

PHOTO: Roscon general manager Sahil Bhasin said replacing cladding was a huge expense to builders. (ABC News)

*7.30 has heard from dozens of Australians who have been hit with huge bills from major building defects, who say they had little to no consumer protection in buying their biggest asset.

“We are seeing more and more defects. And that’s due to the products that are being used,” said Sahil Bhasin, general manager of Roscon, a business that conducts defect reports.

“There’s thousands of cases out there, however they just aren’t publicised in the media, that’s the problem, because they don’t result in people being displaced.

“However, when you look at commercial buildings, when you look at factories and you look at domestic dwellings that aren’t complete, there are thousands of cases out there.”

SOURCE: https://www.abc.net.au/news/2019-10-23/financial-stress-and-emotional-toll-cladding-defective-apartment/11616894#

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NSW builders would owe Duty of Care, be easier to sue for faulty work under proposed Laws

Will these new rules have holes in them big enough to drive a truck through?

YEP …

RETROSPECTIVE means … looking back on or dealing with past events or situations.

SO therefore current owners … those who have purchased properties prior to these changes will not be covered by the new laws … thus deve-lopers have dodged a bullet …

BECAUSE … Quote …

‘ The changes will not be retrospective, so any owners of properties that experience issues in the future will not be covered by the new laws.

WILL all the Regulations … with DEREGULATION having taken place especially since 1993 in the Building Industry … be restored?

NSW builders would owe duty of care, be easier to sue for faulty work under proposed laws

By Antonette Collins

23 OCTOBER 2019

cracked wall and plaster next to door

PHOTO: The cracks in Opal Tower were partly because of incorrect installation of concrete panels. (Supplied: Weibo)

RELATED STORY: Apartment owners say Mascot Towers is on unstable ground due to ‘loss of soil’

RELATED STORY: ‘Absolute stupidity’: Opal Tower’s multi-million-dollar repair bill revealed

Home owners would be in a better position to take legal action against dodgy builders under new laws being introduced by the NSW Government.

Key points:

  • The building commissioner said the changes could be a “game-changer” and would help shore up the construction industry
  • The laws would mean builders must register their plans and a duty of care would be owed to owners
  • Penalties would be in excess of $100,000 for dodgy work

The proposed reforms come after the building disasters of Sydney’s Opal Tower and Mascot Towers, where major cracking pushed all owners out.

The tougher regulations would mean builders and designers are required to register plans for key elements like water-proofing to ensure they are carried out in compliance with building standards.

The new laws also state that a duty of care is owed by a person who carries out construction work, making it easier for home owners to sue their builder if things go wrong.

Building commissioner David Chandler said this will be the first in a series of legislative changes to help shore up the industry.

“We’ve got to stop making up construction in the field. So the first thing that we’re going to get here, is we’re going to get documentation that is completely, properly declared as being fit for construction,” he said.

“That’s a leap — that is huge. All of the designers out there acknowledge the fact that that’s a game-changer straight away.”

Renewed trust in ‘great Australian dream’

Minister for Better Regulation Kevin Anderson said the legislation would restore confidence among residential buyers.

Those that do the wrong thing, those who cut corners, hopefully they will be gone,” he said.

“This is the start of the process that industry has been calling for. We want to fix the problems right at the start.”

He said there would be significant penalties set out in the regulations, in excess of $100,000 for corporations and individuals.

“What we’re doing today is, we’re drawing a line in the sand to fix those problems right at the start so mums and dads who buy into residential apartments in Sydney, in NSW, will have confidence that their dream — the great Australian dream — is as the plans that have been declared in that building.”

The changes will not be retrospective, so any owners of properties that experience issues in the future will not be covered by the new laws.

SOURCE: https://www.abc.net.au/news/2019-10-23/dodgy-builders-to-face-hefty-penalties-under-new-nsw-laws/11631874

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MASCOT TOWERS On Unstable Ground due to ‘Loss of Soil’: Owners Say!

IT would appear that the longer ALAND, the Builder of neighbouring Peak Towers blocks access for the MASCOT TOWERS Engineers … the more attention they draw from the audience of SydneySiders concerned about defective developments … and unfair debt imposed upon the Mascot Towers residents …

ALAND’s reputation as a builder it would seem is sullied … how can they believe they can ride this out? How can they possibly recover?

Mascot Towers on unstable ground due to ‘loss of soil’, owners say

By Paige Cockburn and Nicole Chettle

23 OCTOBER 2019

An apartment block

PHOTO: Mascot Towers, in Sydney’s inner-south, has been empty since June. (AAP: Bianca De Marchi)

RELATED STORY: ‘Absolutely devastating’: Mascot Towers cracks getting bigger, report finds

RELATED STORY: Mascot Towers repair bill hits $20m as engineers close in on cause of cracking

The owners of Sydney’s troubled Mascot Towers claim new tests have revealed a “loss of soil” under the cracking apartment complex’s north east corner.

Key points:

  • The Mascot Towers Owners Corporation said new tests revealed the soil supporting the building has lost “bearing capacity”
  • *They claim engineers have been refused access to neighbouring apartment block Peak Towers where there were previous groundwater leaks
  • On Tuesday night the owners decided to pursue a commercial loan instead of raising money in special levies, which some could not afford

The 132-unit block was evacuated in June, and its Owners Corporation on Tuesday accused the developer of a neighbouring apartment complex, Peak Towers, of denying access to engineers as they try to determine the cause of the structural problems.

“Urgency has arisen following tests revealing a reduction in bearing capacity of soils at the north eastern corner of the building near the boundary of the Peak Towers development,” an Owners Corporation statement read.

Aland — the company that built Peak Towers — said it had not been shown the report the Owners Corporation was referring to.

The Owners Corporation urged Aland to do “the right thing” and allow them access to the building.

“If Aland is confident that Peak Towers is not of any cause for concern for Mascot Towers, then they should have no difficulty in allowing our engineers access to the site,” the statement read.

In a statement, Aland’s managing director Andrew Hrsto said his company had no control over access to Peak Towers.

A man stands in front of a brick wall holding a piece of brick.

PHOTO: Mario Pizzolato said cracks appeared in the wall of his business when Peak Towers was built in 2018. (ABC News: Emily Laurence)

A separate report released earlier this year found waterproofing systems used to excavate the basement of Peak Towers likely caused the “destabilisation” of land supporting Mascot Towers.

In a statement, Aland also said it had not been provided with the report that links the waterproofing systems to the compromised land and had only seen it “referred to in media reports”.

Patrick McGuire, the spokesperson for Mascot Towers’ Owners Corporation, said lack of access causes lengthy delays for displaced residents.

The Corporation also claimed Bayside Council records indicated Aland was pumping water out of the Peak Towers basement and discharging it into stormwater drains without approval.

The leaks in the waterproofing had now been filled with a cement-like grout compound, the Corporation said.

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Owners opt for loan due to financial stress

About 100 Mascot Towers owners attended an annual general meeting on Tuesday night and voted to rescind the $7 million special levy set up in August due to financial hardship.

Mr McGuire said a number of owners were unable to meet their financial obligations now or in the future.

Instead, the owners agreed on a commercial loan over 15 years which the ABC understands is for $10 million.

Cracks in the building industry

Cracks in the building industry

The cracks first appeared in the buildings. Now they have begun to spread across the finances of the construction industry, writes Ian Verrender.

Earlier this year the NSW Government launched an inquiry into building standards after a series of faults emerged in buildings across Sydney.

At Sydney’s Opal Tower, all residents were evacuated last December after cracks were seen across several levels of the 36-storey Olympic Park building.

Some owners have since launched a class action law suit against the State Government.

The Mascot Towers Owners Corporation said all engineering findings were being reported to newly appointed NSW Building Commissioner David Chandler — a role created by the State Government two months ago in response to concerns about construction standards in Sydney.

Aland has refused the ABC’s request for comment.

A man stands in front of a brick wall holding a piece of brick.

SOURCE: https://www.abc.net.au/news/2019-10-22/mascot-towers-on-unstable-ground-owners-say/11626120

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FAULT LINES: HOME OWNERS left high and dry while their building crumbles around them

Home owners left high and dry while their building crumbles around them

7.30 Report

Home owners left high and dry while their building crumbles around them

Posted Tue 22 Oct 2019

Expires: Wednesday 18 September 4757

Construction is a complex industry with many layers of responsibility, so where does the blame lie when things go wrong? Builders, if they’re still around, are the first port of call. But private certifiers or building surveyors say they’re often the ones unfairly accused of missing defects. Many in the industry say the rules just aren’t tough enough to enforce accountability or stop those cutting corners.

GEOFF HANMER, ARCHITECT: It’s almost incomprehensible but government has had an agenda to reduce regulation at a point where buildings have become more complex and probably require a higher standard of regulation.

Statement from Emad Farag

Statement from Kamran Zand Basiri

Statement from Denis Martin

VIEW: FAULT LINES

https://www.abc.net.au/7.30/home-owners-left-high-and-dry-while-their-building/11629154

AND … VIEW ‘APARTMENT OWNERS PAYING FOR DEFECTIVE BUILDINGS’

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Majority of off-the-plan apartments worth less than purchase price, data show

IMAGINE if you were one of these owners …


you now have further problems

.with your finances, the bank may have second thoughts about your mortgage

.along with the falling value of your property your equity is not looking good either

.if you are looking at selling you know it’s going to be harder to get even near what you need to break even

.to sell now means further proof of your meeting quality assurances the market is now demanding following recent well-publicised failings in this space

AND where are the strata fees going, where are the insurance premiums going, up of course!


Ever increasing realisation that once the developer and builder have left the site having met their minimum obligations they are off the hook, and the owners and the body corporate are left with the issues and liabilities.

Gladys is not going to help, after all her lot are about development they are simply not sincerely concerned about anything that stands in the way.

IT will be interesting to see how long her lot will keep pretending they are genuine about fixing the backlog of major building defects … all they seem to be interested in doing is keeping secret the list of those buildings still cladded in dangerous materials! OMG!

VIEW 7.30 TONIGHT!

Majority of off-the-plan apartments worth less than purchase price, data shows

7.30 By Tracy Bowden and Kirsten Robb

21 OCTOBER 2019

Apartments being built.

PHOTO: Off-the-plan apartments have seen a drop in value in Sydney, Melbourne and Brisbane. (ABC News: Jessica Hinchliffe)

Shaky confidence in the capital city apartment market is hitting off-the-plan buyers hard, with a significant rise in the number of newly constructed units now worth less at completion than the price they were originally purchased for.

Key points:

  • According to CoreLogic data for August, more than half of newly constructed off-the-plan apartments in Sydney and Melbourne were worth less than the owners bought them for
  • Nearly a third of off-the-plan apartments in Sydney were worth at least 10 per cent less
  • CoreLogic’s Tim Lawless said there had been an oversupply of apartments in the high-rise sector

7.30 can reveal that 60 per cent of off-the-plan apartments in Sydney, and 52.9 per cent in Melbourne, werevalued lower than their contract price at the time of settlement.

The latest figures from property data provider CoreLogic for the month of August shows that nearly a third of off-the-plan buyers in Sydney were moving into new apartments worth at least 10 per cent less than the price they purchased them for.

Just two years ago, less than 16 per cent of newly constructed NSW units were valued below contract price after they were completed.

In Queensland, 43.1 per cent of units were worth less at settlement than what they were purchased for, and in Western Australia it was 22.5 per cent of apartments.Follow this story to get email or text alerts from ABC News when there is a future article following this storyline.Follow this story

‘A very fundamental shift in value’

The Opal Tower with a sign to the left

PHOTO: Opal Tower was evacuated last year when cracks were found in the building. (ABC News: Nick Sas)

CoreLogic’s head of research, Tim Lawless, said when many of these newly completed apartments were originally sold off the plan back in 2016 and 2017, the market was very different.

“We were seeing values rising at about 15 to 20 per cent per annum in Sydney and Melbourne,” Mr Lawless said.

“Now cast your mind forward to 2019 and we’ve seen prices come down in Sydney by 15 per cent. In Melbourne, they’re down by about 11 per cent.

“A lot of those off-the-plan buyers have seen a very fundamental shift in the value of the project that they purchased a couple of years ago.”

Mr Lawless said there had been a significant oversupply in the high-rise sector, with supply substantially outpacing demand.

But he said concerns around construction quality, remediation costs and flammable cladding had had a compounding effect.

“That [is] probably also weighing on the minds of people in the marketplace and potentially affecting the resale value of those properties as well,” he said.

A string of negative headlines has plagued the apartment market in the past two years, beginning with London’s Grenfell Towers fire in June 2017 and the discovery of the widespread use of combustible cladding on apartment buildings.

In Australia, confidence in the market was further destabilised after the evacuations of Sydney’s Opal Tower on Christmas Eve 2018 and Mascot Towers in June of this year.

Mascot Towers owners still in limbo

An apartment block

PHOTO: Cracks at Mascot Towers have gotten worse, residents have been advised. (AAP: Bianca De Marchi)

Owners at the 10-storey Mascot Towers in Sydney have fared far worse than most.

Not only have residents such as retiree Maree Peters watched their building garner major media coverage for its structural defects, they have still not been able to return to their homes.

“We have an asset worth one and a half million dollars that right now is worth nothing,” Ms Peters said.

“It’s your home, it’s everything you worked for, that you think is safe, that you think is protected.”

Having recently learnt that the cracks in their building are widening, owners will meet Tuesday to vote on a program to fund their building repairs.

They will decide between a commercial strata loan or a multi-million-dollar levy to pay for urgent repairs.

Stage one of the levy would cost around $7.7 million.

“At the moment we have a building that if we don’t do anything it’s worth nothing, and unless we put money in to try and get some value back we are left with an asset that is worthless,” Mascot Towers owner Brian Tucker said.

Watch this story tonight on 7.30.

SOURCE: https://www.abc.net.au/news/2019-10-21/majority-of-off-the-plan-apartments-worth-less-than-bought-for/11613256

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