Samantha Reece, Director of AAA recently attended the Safe Buildings and Defects seminar in Sydney and Brisbane as a guest speaker, where she heard from Prof. Stephen Foster, who was intimately involved in the Opal Towers investigation.
We all remember those haunting images of residents being evacuated from Opal Towers Christmas Eve 2018. But what you may not have known, is that the Developer of this project, not only housed the residents, but also paid for the repairs and has now given a 20 year warranty on the works.
And that is key to the current perception with building defects. A defect may be a crisis initially – but in most cases, it can be repaired. This has even been the case of the well-recognised Mascot Towers.
In the Opal Tower’s case there were a number of architectural features in the building, which were 6 storeys high each and it was these elements that led to the structural issues.
The final investigation report highlighted that the reinforcement in one of the concrete panels was inverted and, secondly, there was a conduit pipe running through a critical element that was not needed. And finally, the 180 mm thick hob beam lacked reinforcement to prevent its splitting, and in conjunction, this was a recipe for failure.
But once the cause was identified, the repair was relatively straight forward with the team stripping back the affected area and then applying reinforced walls each side to provide the strengthening needed, and the residents have since returned home.
But there is no doubt the next step is to reassure the market that in fact, Opal Towers is not doomed.
Recent research by AAA with 1050 apartment owners nationally stated that 62% would recommend apartment living if they had not experienced a defect and yet only 39% would, if they had. And to us this represents the real crisis.
So, what can buyers do to protect themselves with an apartment purchase?
Firstly, make sure the builder is offering a 12 month defect period as a minimum, engage a buyer’s agent to conduct a pre-settlement inspection and then make sure you do your homework on the builder and developer. In particular, you want to know how long they have specifically been in the apartment development business and if possible, inspect some of their completed projects to understand the standards of the finished build. A Developer that utilises the Australian Standard’s Builders Contract or holds a retainer, is also preferred, as this requires the builder to hold in trust 2% of the build value, which is then only released once all the defects have been addressed.
But once you have bought, the due diligence does not stop - with ongoing maintenance key. But typically, this is where lot owners and Council of Owners are fuzzy on their duties. From experiences in the East, it is quite clear that apartment owners are not only responsible for undertaking the necessary maintenance but also conducting building inspections and ensuring that any matters that arise – despite being distressing – are dealt with in a business like manner.
And because the Australian Apartment Advocacy’s philosophy is that prevention is better than cure, we are looking to take steps to both educate buyers and address the loopholes in the system and this in turn will undoubtedly restore confidence in the market place and in turn, that is essential to the future of housing choice.
