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Mascot Towers Owners Hit $76,000 per Unit

Owners of apartments in the evacuated Mascot Towers building in Sydney are planning to sleep on the street to protest a damages bill of at least $76,000 per unit to fix defects, as questions continue on who will ultimately have to pay. The owners face a $10 million bill – half the initial building cost of $22 million – to fix cracks in the building's primary support structure, according to the notice for an owners meeting to be held on August 22. "As the NSW premier has said, self-regulation has failed, leaving a legacy of defects and distress," Owners Corporation Network executive officer Karen Stiles said. "The immediate task is to put in place a rescue package for strata schemes struggling right now."
The Australian Financial Review
Su-Lin Tan

Building certifiers leave a trail of chaos

A small group of private certifiers have signed off on 130 buildings with compliance problems, including allowing residents to move into one property that did not have toilets or taps fitted. The six offenders have been hit with 111 disciplinary actions since 2005, accounting for about a quarter of all such penalties. The Owners' Corporation Network, the peak body for apartment owners, said the repeat offending was further evidence of "deep systemic problems" in the industry. "It is symptomatic of a government that has forgotten how to regulate," chairman Phil Gall said. "The Building Professionals Board was overseen by the planning minister until 2016, when it became the responsibility of the minister for better regulation. "Three years later we still have serious problems," Mr Gall said. "How did the ministers involved not know this reform wasn't working?"
The Sydney Morning Herald
Carrie Fellner and Nigel Gladstone

The hidden costs of Brisbane's apartment correction

In total, Brisbane has foregone 2497 of the 4014 apartments approved in towers since 2009, said Don Smith, BCI's economics team leader. "From an 'impending oversupply' perspective out of a total of 4000 apartments that are being proposed, nearly 2500 have yet to meet appropriate technical and commercial criteria," Smith said.  "There is an element of self-regulation." The figures paint a reassuring macroeconomic picture of a market correcting, but they also hide the costs of that correction, borne mainly by consumers. One of those is Michael Lyle, who works for an energy retailer. Lyle paid an $87,000 deposit in December 2015 for a two-bedroom apartment in Icon, a two-tower development in the inner Brisbane suburb of Milton that marked developer GH Properties' first foray into the Australian high-rise market. The start was delayed. Hutchinson Builders cleared the site in 2017 and started work. In November, work stopped. Hutchinson's contract was terminated and it subsequently removed its crane and equipment. The site with partially built structure at 20 Walsh Street is now closed off with hoarding.
The Australian Financial Review
Michael Bleby

David Chandler OAM Appointed NSW Building Commissioner

Home owners will be better protected following the appointment of building and construction expert David Chandler OAM as NSW Building Commissioner. Premier Gladys Berejiklian said the appointment of Mr Chandler was part of the NSW Government’s commitment to implementing the biggest overhaul to building laws in the State’s history. “David has more than 40 years’ industry experience, which will be invaluable as we move to restore confidence in the building and construction industry,” Ms Berejiklian said. “We know there are national challenges affecting the industry, but this new appointment will play a key role in protecting NSW homeowners and driving critical reforms.” The Building Commissioner will be responsible for the investigation and disciplinary action for misconduct in the building industry while overseeing the end to end licensing and auditing across the building industry.  The Commissioner will also drive legislative reforms of the building industry, including consultation with industry. Mr Chandler will start in the position on 14 August 2019.

Call for NSW building commissioner to enact acute 30-day plan

New NSW building commissioner David Chandler should strike an acute 30-day plan to help beleaguered homeowners who have been evacuated from their defective homes, ahead of larger plans to overhaul the industry, industry groups say. NSW appointed Mr Chandler, a building and construction expert and University of Western Sydney adjunct professor, as the state's first building commissioner on Thursday in an effort to rehabilitate the state's ailing building industry after several apartment buildings had to be evacuated. A spokesman for the Owners Corporation Network added: "The immediate task is to put in place a rescue package for strata schemes struggling right now."
The Australian Financial Review
Su-Lin Tan

Opal Tower residents to sue NSW government

Owners of units in Sydney’s troubled Opal Tower are suing the NSW government for compensation, the Premier has this morning confirmed. Premier Gladys Berejiklian said she doesn’t “blame anybody” for taking legal action after a building flaw resulting in a large crack saw residents of the tower evacuated on Christmas Eve last year. "This is an unfortunate set of circumstances. We inherited the system we have today and we're aiming to fix it by the end of the year through legislation,” she said. According to research by Deakin University, 97 per cent of new high-rise apartment buildings in NSW have some form of defect. It’s something the executive officer of the Owners Corporation Network, Karen Stiles has described as a “quiet haemorrhaging”.
Yahoo Finance
Lucy Dean

Victoria hits wall on phoenix builders, needs Commonwealth help

Premier Daniel Andrews has watered down statements that Victoria was about to crack down on builders who closed their doors to avoid cladding-related claims, saying state legislative changes would take time and that changes in anti-phoenixing laws were up to the federal government. "We’re looking to strengthen legislative requirements to crack down on this so we can better recoup expenses and lessen the burden on taxpayers. We’ll be in a position to provide more information later this year," the spokeswoman said. "We acknowledge that legislation governing phoenix activity is primarily a federal government responsibility and we call on them to work with us to fix this problem." "So many of these apartment buildings have been built by phoenix companies and almost as the last nail is driven, the company folds up and there’s no one to go after. We think that’s something that should be on the national agenda as well," Mr Andrews said at the announcement.  
The Australian Financial Review
Michael Bleby

NSW Government Reforms Not Sufficient: Industry

The NSW government's reform plans for the state's failing building and construction industry are not enough to fix it, industry groups warn. Consultations on the state's planned reforms – which involve the adoption of the recommendations from the Shergold-Weir report ahead of new legislation – have closed, drawing strong responses from the public. The Owners Corporation Network (OCN) submission to the government says the current reforms merely help the government buy time to plan a new one (future).
The Australian Financial Review
Su-Lin Tan

Brisbane luxury apartment defects force owner out of home still unliveable two years later

A Brisbane unit owner is facing bankruptcy after a serious defect in her new $1.7 million luxury apartment caused thousands of dollars worth of damage, forcing her family to move out. Dr Carter said she first raised issues with the developer and her body corporate, and also complained to Queensland's Building and Construction Commission (QBCC).  The QBCC ordered construction company Maxcon to fix the leak and later closed the case file after some works were carried out. After complaining to the Office of Fair Trading that her unit was not fit for purpose, Dr Carter was told the matter was classified as a "warranty" issue, suggesting she could take civil action in court. She said she had been left thousands of dollars out of pocket after renting another property.   "We're in limbo," she said. "We're caught in a stalemate between parties — I feel like collateral damage in a financial equation and it's just not good enough — it's my home."
ABC News
Josh Bavas

Fire engineer urges Australia to follow UK’s lead

A senior fire engineer has urged the Australian government to follow the UK’s lead when it comes to rectifying the flammable classing crisis. Ferm Engineering CEO Stephen Burton spoke out about the issue this week, after returning from a fact-finding mission to the UK where he met team members who worked on the Independent Review of Building Regulations and Fire Safety – a report commissioned by the British government after the fatal Grenfell Tower fire. The UK is now implementing review chair Dame Judith Hackitt’s interim report, published in December 2017, as well as her final report, published in May 2018. “The Federal Government should learn lessons from the Hackitt reports and urgently establish an overarching strategy with tight time frames, rather than leaving building industry reform to state and territory governments that are all taking different pathways,” said Burton. The British government has committed £600 million to help building owners and is moving ahead quickly with assessing, testing and remediating government and privately-owned buildings – according to the plan, the remediation program will be completed by June 2020.
Insurance Business Australia
Nicola Middlemiss

Residents at risk: Council sought demolition orders on Alexandria block

Residents of an Alexandria apartment block are at a "public risk" after a private certifier illegally allowed them to move into a building that the City of Sydney was so concerned about it sought demolition orders. In a fresh chapter to Sydney’s unfolding building standards crisis, the Herald can reveal that the developer failed to to carry out "extensive construction work" to make the building compliant as ordered by the Land and Environment Court in 2017. As a result, the council is now left considering legal action against the owners corporation, in a bid to resolve what the court has branded a "completely unsatisfactory state of affairs". The saga over the "Joshua" building, at 33-49 Euston Road, Alexandria, has emerged as concerns continue to intensify over building standards across Sydney. A neighbouring resident involved in lobbying council over the development, Stefan Jarnason, described the issue as "morally black and white".  "It would be outrageous if the developer is able to get away with not rectifying it," Mr Jarnason said. "It shouldn’t be the owners corporation, the people who’ve bought off the plan in good faith." Carrie Fellner is an investigative reporter for The Sydney Morning Herald.  
The Sydney Morning Herald
Carrie Fellner

Faulty Wires Could Spark the Next Cladding Crisis

Four thousand kilometres of faulty Infinity cables in homes across Australia could become the next "cladding crisis" in the next two years if they are not remediated, industry groups warned as they push for a national building products certification system. Concerns about the cables add to the wider pool of building defects widely expected to hit Australia's high-rise apartment sector. In 2015, a group of 13 industry groups, including Master Builders Queensland, raised concerns about the cable and the need for a national product register that accurately certified safe products to Karen Andrews, then the parliamentary secretary to the Minister for Industry and Science, and now the federal industry minister. The group said Ms Andrews, while open to the concerns, had not yet done anything to support a system of third-party product certification schemes.  
The Australian Financial Review
Su-Lin Tan

Canberra developer licencing scheme being considered after ACT Labor call for change

An Australia-first licencing scheme that would crack down on developers avoiding debts and defect bills by requiring increased transparency is being considered by the ACT Government. A resolution passed by the ACT Labor conference over the weekend called for the introduction of a developer licencing scheme, which would ascribe a number of conditions to developers working in Canberra. It would require developers to demonstrate they have the financial and operating capacity to fully complete proposed projects, including being able to address any defects that arise after construction is complete. They would be required to disclose how developments are funded, making it more difficult for companies to go into liquidation in order to avoid debts, only to re-emerge as a new company — a practice commonly known as phoenixing and set up trust accounts to ensure contractors and subcontractors are still paid if a developer goes into liquidation. The motion was brought by the CFMEU, whose ACT branch secretary, Jason O'Mara, said developers had thus far avoided the scrutiny placed on other parts of the industry.
ABC News
Jordan Hayne and Jake Evans

What to do about defective buildings

Jimmy Thomson from flat-chat.com.au and Stephen Goddard, OCN spokesperson talk about what to do if you live in a building that requires remediation.
ABC Radio Sydney
James Valentine

Ministers fiddle while buildings crack and burn

The construction industry crisis didn't happen overnight. Authorities have been on notice for years to fix the problems that now have the industry itself calling for better regulation. The Building Ministers’ Forum (BMF) met last week yet again to discuss implementing the February 2018 Shergold-Weir Report they commissioned in mid-2017. The BMF is responsible for overseeing the Australian Building Codes Board (ABCB) and building regulation across Australia. The BMF announced yesterday it’s going to “strengthen” the ABCB, which will be “expanded to include greater representation and engagement from industry”. This is the same regulator and the same industry that have been responsible for producing the dud buildings that have been making news across the country: Lacrosse, Opal, Neo200, Mascot Towers, the Gadigal Avenue apartments and countless others that have leaked, cracked and failed, but in less newsworthy ways. The situation is so bad, and trust in the industry so damaged, that we were treated last week to the unique spectacle of Meriton boss Harry Triguboff, among others, asking the government to do a better job of regulating builders. What we need now is concerted and urgent action to stop defective buildings being built and a plan to help residential apartment owners rectify their buildings. The highest priority is to replace combustible cladding on tall residential buildings. The Victorian government should be congratulated for going forward with a scheme to achieve this. Meanwhile, the BMF and the ABCB are still fiddling while Rome burns. They need to get on with it.
UNSW Newsroom
Geoff Hanmer

What Members Say

"The whole strata community owes a huge debt of gratitude to you and the OCN executive. Much appreciated."

Robert, Darlinghurst

"I am very pleased with my membership of OCN, the discussions through sharing emails is very valuable in increasing my knowledge of strata living, the laws and EC responsibilities. I think I am better armed to tread the minefield of the managing agent responsibilities and the necessary action of the EC to monitor the contradictory interests of the agent."

Jim, Wollstonecraft

"I so appreciate being part of the OCN email forum. It provides a great opportunity for sharing ideas and learning"

Ingrid, Neutral Bay

"I must say that I have enjoyed and found consolation in the discussions that have been part of the email chain (forum). I did attend one general meeting and found that it was informative and the people "running the show" were knowledgeable and dedicated to the tasks that had taken on. In short, well done. You and the committee have and continue to support the Strata Community in a very professional manner."

Greg, Parramatta

"Nothing is easy in Strata World and we have been in building defects “mode” for some years – hopefully almost at an end but that process has been most demanding and difficult but again – greatly helped by the experience and wise counsel of other members of OCN."

Pat, St Leonards

"Keep up the good work, as many (if not most) strata schemes need your help, advice and representation at all levels of government."

Jann and John, St Ives

"I belong to OCN because of its professionalism.  I have found the meetings I have been to extremely well presented, to the point, and of course very topical and informative. Speakers on the whole certainly know their topic.  My role of Secretary last year was certainly assisted with the coverage regarding TPG & other subjects. Member newsletters are also of benefit as the topics are specific to strata matters."

Graham, East Balmain

I have enjoyed attending the quarterly OCN meetings and the exchange of emails between other Executive Committee Members and think OCN is playing an increasingly important role as a voice for strata dwellers and representing us at Government level. I wish the organisation continuing success in the future."

Pauline, Kings Cross

"The [forum] response to my question was amazing and really useful.  The OCN community is wonderful so thanks."

Jenny, Killara

"I would like to thank you all for the important effort that you are all putting in to look after apartment owners and tenants. It is so valuable and you are heroes. I would not have been able to deal with my duties as a strata chairman without your advice and assistance." 

Angela, Mascot

"The OCN is invaluable – many thanks."

Bill, Surry Hills

"OCN is proving invaluable"

Sue, Neutral Bay

"Thanks to all at OCN for your continuing efforts to keep us up to date with current strata information and advice...it has been very helpful to us"

Kate, Coogee

"When my wife & I first encountered a problematic Executive Committee I heard that OCN was a great help (from a Strata manager whom I knew) so we both joined and have gratefully used the on-line information sources. We continued to happily rely on OCN’s assistance when we progressed to Committee status & later as Chair & Secretary of our Committee. I still use OCN in my current role as Treasurer."

Peter, Chiswick

"Thanks to OCN for being such a rich resource of trustworthy information about strata matters."

Peter, Chiswick

"I wanted to extend my personal thanks for the very informative & interesting event today. The OCN team did an outstanding job in the organisation of this event & I enjoyed it thoroughly. The quality of speakers, the flow of conversation & interaction from the attendees - first class …& of course, the amazing Jimmy T - always a delight."

Sue, Epping

"OCN does a great job in providing a really valuable service to Strata owners."

Lois, Wollongong

"I am sure my appreciation of your good works is echoed by many in the Stratasphere. Keep up the good work."

John, Elizabeth Bay

"Once again, being able to discuss such things through this forum, helps clear the mind, puts things into perspective and helps one to understand their rights and to form a strategy if needs be. As a simple EC member trying to do what is in the best interests of lot owners, I truly value OCN and am grateful."

Pamela, Point Lookout

"The OCN is probably one of the best, most informed and most informative groups I have been involved with."

Alan, Maryville