For decades the brutalist apartment block at 20 Illawong Avenue, Tamarama, was known as the ugly duckling of the east.
Occupying one of the most sought-after pieces of land in Sydney, the 7 story, 1960’s apartment block had seen better days.
For starters, the building had concrete cancer and there were two council fire orders. There was only one lift to service 78 units and parking for only 50 cars (none of which were under cover), and despite every apartment having 180-degree ocean views, there were no balconies.
Today the building has been completely transformed with the one-time ugly duckling now looking more like a contemporary 5-star hotel overlooking one of Sydney’s most iconic beaches.
Due to efforts of the forward-thinking executive committee led by persistent chairman Christine Smetsers, the owners have not only fixed the defects but improved the property enormously by putting balconies on the ocean side for all 78 units; replacing the existing lift and adding a second lift; building an underground carpark for all units; and adding terraces on the western side of the property.
These works have increased the floor space of each unit by 25% and the owners believe the rectification, new balconies and car parks has meant the capital value of each property has sky-rocketed.
In the process, the concrete cancer; fire orders; and other building defects are now rectified.
The work also included building 2 new penthouses, sales of which will contribute a substantial amount to fund the enhancement.
And this was all achieved with minimal upfront costs being incurred by the owners.
So how did they do it?
Strata finance is gaining momentum in Sydney’s east as owners corporations look to fix defects and undertake aesthetic improvements to aging buildings.
A strata loan is an unsecured loan to the owner corporation.
The funds can be used for strata improvement projects like refurbishment, renovations, defects, green projects and repairs. This allows owners to complete capital works on their buildings, often without the need to raise special levies.
When completing a project using a strata loan, owners enjoy the lifestyle benefits and investment returns of completing the project sooner. Owners don’t have to wait around for a sinking fund to accumulate but can get work done at today’s costs and avoid the problem getting worse.
“The fantastic outcomes being achieved by Skye Tamarama highlight how funding solutions assist strata owners affected by building defects and general deterioration,” says Paul Morton, CEO of leading strata lender Lannock Strata Finance.
“Strata borrowing means that owners can achieve that fantastic dream for the property – balconies, car parking, roof-top garden, a penthouse on top – it’s all possible,” Mr Morton said.
Christine Smetsers, chairman of the strata committee said; “Another benefit is that health and safety issues are resolved as quickly as possible”. Value is restored to each individual property. An initial period of interest only gives owners time to evaluate their personal financial position. Owners should talk to their accountant about additional benefits of a strata loan.
Lannock CEO Paul Morton said the case of Skye Tamarama “showcases the benefits of strata finance over special levies”.
Michael Pallier of Sotheby’s who is handling the sale of the two penthouses said; “Work is nearing completion at Skye Tamarama which represents Australia’s largest strata asset renewal project. The penthouses will be very well received by the market”.