Marshall White Projects Newsletter Edition 17

Projects Review Edition 17. 2019

Remediation Work; Who Pays?

Victoria’s Cladding Crisis

Apartment Must Haves

Interior Directions in Multi-Residential Design

Advice from ASK planning

What Developers should look for in a Vendor Statement

Contents

Contributors

1 Notes From The Directors

Remediation work; Who Pays?

— Dame Judith Hackitt, Cladding Expert

2 Spotlight 4 Current Projects 6 Remediation Work; Who Pays?

8 Victoria’s Cladding Crisis 10 Apartment 'Must Haves' 12 Interior Directions in MultiResidential Design 14 Advice from ASK Planning 16 What Developers should look for in a Vendor Statement 18 Past Project Profiles

Victoria’s Cladding Crisis – Bryan Phillips, Director, Tideways Apartment 'Must Haves' — David Carabott, Director, CHT Architects Interior Directions in Multi-Residential Design — Adele Bates, Director, Adele Bates Advice from ASK Planning — Mark Stanojevic, Director, ASK Planning Services What Developers should look for in a Vendor Statement — Jeremy Quah, Senior Associate, TLFC

Projects 3 St James Park 3 Balwyn Park 4 Lawson 4 Profile 4 Verse 5 Lindsay Street 5 Botanical 5 Anderson Park Past Project Profiles 16 Hotham & Carlisle 16 9 Shuter 17 Parq 17 Central Park

Cover Photo: Anchor & Cecil 10 – 16 Cecil Place Prahan

Every effort is made to provide accurate and complete information in Marshall White’s (trading as Marshall White Projects) technical and regulatory newsletters. However, Marshall White cannot guarantee that there will be no errors. Marshall White and its contributors to the newsletter make no claims, promises or guarantees about the accuracy, completeness, or adequacy of the contents of the newsletters and expressly disclaims liability for errors and omissions in the contents of this newsletters. Neither does Marshall White and its contributors to the newsletter assume any legal liability for any direct, indirect or any other loss or damage of any kind for the accuracy, completeness, or usefulness of any information, product, or process disclosed herein, and do not represent that use of such information, product, or process would not infringe on privately owned rights.

+ 61 3 9822 9999 1111 High Street, Armadale VIC 3143

Disclaimer: Information provided is believed to be accurate as at the date of printing, no responsibility is taken for any errors or omissions.

It is your responsibility to obtain independent, professional advice.

Notes from the Directors Right now most parties associated within our property development industry (including your own humble Estate Agents) are taking what we perceive to be a plethora of “good news” and are continuing to run it up the flag pole at every opportunity. And why not?

Long have we suffocated brothers (and sisters) under an avalanche of depressing, sky is falling, told you so advice that has been trotted out, ad nauseum, over the past three long years.

Yes, we’d all like to reacquaint ourselves with the muscles on our face we used to engage when smiling, unblock the phone number of our Mercedes dealer and proudly wear around our “Lets Make Developing Great Again” baseball cap. But most of us haven’t done so, well not yet anyway.

When good new travels in threes, namely; the RBA cut lending rates to the lowest level ever, the easing of the banking regulator of mortgage serviceability criteria (see “stress test”) and Labor’s proposed changes to both CGT and negative gearing not getting up then buyers are continuing to vote, only this time with their feet.

The volume of off the plan sales transacted by Marshall White Projects increased by an impressive 27% in relation to the April – June quarter of 2019. We now receive on average 520 leads per week, this time up 32% from the quarter prior and our Resi team have hit success rates for an auction weekend in the 70%’s consistently for the first time in many, many months.

We haven’t spotted anyone yet strolling down High St, thumbs cocked in suspenders whistling “happy days are here again”. We all know there’s a long way to go.

Prices have fallen so development margins have become thinner, sometimes too thin for a major lender, the cost per sale is significantly higher and the days on market have continued to extend.

Those developers and investors that have stored their nuts during this cold winter will still recognise that it’s all very much worth doing. So forget that second job driving for Uber of an evening, rather stick to buying sites well, making good commercial decisions when selling product and when an agent volunteers his or her fee then try hard to respond with “what, can’t I pay more?” because it’s never enough.

We’re always fortunate to have really smart people contribute articles to our newsletters and our 17th edition is no exception.

We again feature Project’s that are selling. They're selling because they’re cut, marketed, priced and spec’d to accord with market – it’s really that simple.

If your project is regrettably not selling then, as they say, you need to “control the controllable” by recognising that its only ever one of two things, product or price that’s stopping your project from moving. Some (developers and project marketers) wont do this because it starts with the premise that you got one, or both of these items wrong from the start.

Changing is hard, costly work, however its far more profitable to address the need for change, than leaving it up to the next developer or project marketer to make choices and who then capitalises on your inability to take action.

Our past projects feature both sides, those who initially got it right and those who had the courage to change course mid stream, but in each instance the ultimate results are the same; you sell all you need to sell, you make a profit, and you have a gratifying sense of accomplishment after receiving a nice bottle of wine from someone who’s always smiling, your bank manager.

As always, good selling.

Mark Dayman Director

Leonard Teplin Director

T: 03 9832 1193 M: 0409 342 462 mark.dayman@marshallwhite.com.au

T: 03 9832 1191 M: 0402 431 657 leonard.teplin@marshallwhite.com.au

1

Spotlight

Liam Adey

Mark Dayman

Tanya Gubic

Sales Executive

Director

Sales Executive

Personable, positive and hardworking, Liam strives toward helping people achieve their off the plan purchasing requirements.

Since the creation of Marshall White Projects in 2013, Mark has lead a dedicated project marketing team that has sold literally thousands of new ‘off the plan’ apartments or townhouses. He has a wealth of knowledge and experience accumulated in nearly 30 years in the industry.

A highly acclaimed agent with extensive sales experience, Tanya distinguishes herself through her ability to shepherd her clients through through a sale with compassion and expertise. Her keen attention to detail, resilience and approachable nature equip her well for a fast paced career.

Maintaining open channels of communication, Liam easily develops a natural rapport with his buyers.

Liam finds the development industry to be incredibly rewarding as it revolves around making connections with people and perfectly suits his positive mindset. Combined with his strict time management, perfectionist nature and a refined attention to detail, Liam is well suited to his role at Marshall White projects.

Active by nature and a big believer in the value of physical fitness and a healthy social life, Liam divides his free time between playing basketball, spending time with his friends and supporting his beloved Hawks.

2

“The opportunity to be involved in every aspect of a sales and marketing campaign means that I can take full ownership of helping our clients achieve the best yield, not just the best price with reduced days on market. In the end it’s all about giving our developer clients a competitive edge in the selling process.”

In his spare time, Mark enjoys spending time down at the coast with his wife Sam and four daughters and supporting his beloved Adelaide Crows.

Tanya forges strong relationships with all of her clients and is proud of her ability to connect with people of an incredibly diverse range of ages and backgrounds. Always prioritising her clients’ needs, she is an active listener and determined to provide a personalised service, recognising and relishing that no two clients are the same.

A fan of Melbourne’s thriving coffee culture, Tanya loves having breakfast at her favourite local café and keeping fit at the gym with her fiancé Harry.

When she isn’t working hard to exceed expectations, she enjoys taking any opportunity she can to travel and relaxing poolside in the summertime.

St James Park 1A Yarra Street Hawthorn

Balwyn Park 7 Cherry Road Balwyn

3

Current Projects Lawson

Profile

39 Lawson Street Hawthorn East

1443 Dandenong Road Malvern East

Verse 18 Wilkinson Road Sunshine

4

Current Projects Lindsay Street

Melfort

10 – 12 Lindsay St Brighton

496 Glenferrie Road Hawthorn

Anderson Park 585 Burke Road Camberwell

5

Remediation Work; Who Pays?

Who should pay for remediation work?

Cladding expert Dame Judith Hackitt weighs in on the debate:

The extent to which builders have used inflammable cladding on buildings in Australia and the UK has shocked us all since its discovery in the wake of a number of serious fires, including the tragedy at Grenfell Tower in London in June 2017.

The people with the highest level of concern are those who are living in these buildings - quite rightly they want the problem fixed, and fast.

But who should pay for the remediation work? It feels wrong for those who live there to be asked to fund a problem caused by someone else.

6

Even if Government pays doesn't that mean those who cut the corners in the first place get let off the hook rather than being held to account?

Of course it does.

But waiting for those who are truly responsible to own up and do the right thing won't work either - some might, but many will at the very least prevaricate and instigate lengthy legal proceedings to argue the case. That leaves residents living in buildings they are deeply concerned about indefinitely. It's a real "Catch 22" - or is it?

The UK Government and now the Government of Victoria have recognised that public safety and restoration of public confidence must come first and have taken the decision to fund removal of cladding and remediation out of the public purse. But the battle to hold those to account must go on - through the courts if necessary to recoup as much as possible of that money.

It can't stop there either. In the last few years we have learned a great deal about the state of our buildings - particularly high rise high occupancy residential properties and what we've learned isn't pretty Complex prescriptive regulations and guidance are not helpful - they lead to confusion, accidental and deliberate misinterpretation of the what is written down;

»» Roles and responsibilities are also confused, and the system allows people to pass on problems to others in the system; »» The competency of large parts of the workforce is lacking which means they don't understand the importance of critical safety features they may be installing in a building and how they need to be installed to be effective; »» Even when enforcement action is taken against those who break the rules, the sanctions are so weak as to make it unlikely that lessons will be learned, and practices changed; »» Record keeping is poor which means that after a building is complete no one really knows whether it was built to design and if it is fit for purpose - why has this industry not engaged with what digital technology can do to change this so easily?

" We need to drive a massive culture change in the whole construction and built environment sectors that holds people accountable... "

The market needs to find a way to recognise the importance of quality which means changing procurement practices away from simply awarding the contract to the guy who bids the lowest cost.

The cost of building a high-rise block is a small part of the life cycle cost of the building - getting it right in the first place will lead to lower costs for the rest of the building's life and happier, safer residents. But above all such a culture change to accompany the much-needed regulatory changes is the only way to ensure that more lives are not lost in tragic fires or other catastrophes in our high-rise buildings.

Removing dangerous cladding is a very important first step on a long journey; let us not fall into the short termism trap of thinking we've fixed the problem when we've fixed the cladding.

— Dame Judith Hackitt

Dame Judith Hackitt is a decorated British engineer who visited Australia in February as a guest of RMIT's School of Property, Construction and Project Management with support from the Victorian Building Association, the Institute of Chemical Engineers and the Future Fuels CRC. She presented to industry, government and community representatives about her Building a Safer Future final report. She is currently the Chair of the Independent Review of Building Regulations and Fire Safety, which was commissioned by the British Government following the Grenfell Tower fire.

I repeat what I've been saying for more than two years now - this is about much more than cladding! We need to drive a massive culture change in the whole construction and built environment sectors that holds people accountable for designing, building, maintaining and managing buildings which are safe for people to live in throughout the full life cycle, People - residents - must come first, they must have a voice to raise their concerns, they need to be listened to and the whole industry needs to be held to account for its responsibilities for their safety.

That will require substantive regulatory change in Australia just as it does here in the UK. A new regulatory system needs to drive the right behaviours, make responsibilities crystal clear, create significant penalties for those who flout the law and incentives for those who do the right thing.

We also need leaders within the construction industry to stand up and be counted. Those who do build with users in mind, those who understand that quality matters and have already implemented good practices should be recognised and become preferred suppliers.

7

Victoria’s Cladding Crisis

Much has been said of the current state of Victoria’s cladding crisis.

THE BACKGROUND In June 2007 a fire, started by a malfunctioning fridge on level 4 spread rapidly up the exterior of the Grenfell Tower in North London, bringing fire and smoke to all residential floors. The veracity of the fire saw flames engulf 20 storeys of the building which burnt for over 60 hours.

The Lacrosse building in the Docklands precinct suffered a serious cladding fire on the 24th November 2014 with the devastating fire started by a single cigarette lit on a private balcony.

The question of who is liable and ultimately responsible for these building practices is still the great unknown and to date we only have the Lacrosse case as precedent. Judge Ted Woodward, handing down his decision on 28 February 2019 in VCAT found the builder had “breached the warranties of suitability of materials” and was therefore primarily liable to pay damages to the owners. However,” Woodward continued, “LU Simon did not fail to exercise reasonable care in the construction of the Lacrosse tower by installing combustible aluminium composite panels.”

In shockingly similar circumstances a fire broke out on a level 22 balcony of the 41-level apartment complex in Spencer Street known as Neo200 in February 2019. The fire quickly spread up to the 29th floor before 80 firefighters managed to bring the fire under control.

LU Simon, as the Builder was ordered to pay owners $5.75 million in damages arising from polyethylene-core cladding on the 21-storey tower, The architect, building surveyor and fire engineer were ordered to reimburse the builder proportionally:

Tragically 72 people died as a result with a further 70 injured and 223 evacuated.

In both circumstances the fire spread as a result of the combustible cladding material which covered parts of the buildings external facade.

8

These events brought to light deep-seated concerns that hundreds if not thousands of buildings throughout Victoria may be wrapped in non-compliant and combustible cladding materials. Construction lawyer Bronwyn Weir, who was not involved in the Lacrosse case told the Australian Financial Review "there are hundreds of buildings like Lacrosse and Neo across the country,"

Architect Building surveyor Fire engineer Resident whose cigarette butt caused the fire

25% 33% 39% 3%*

*Builder will not be reimbursed by the resident

In addition, a further $6.8m in claims are yet to be resolved.

WHERE TO FROM HERE? In August 2017 the Victorian Cladding Taskforce, spearheaded by former Victorian Premier Ted Baillieu and Deputy Premier John Thwaites, announced the start of a pilot visual building inspection program to help determine the extent of aluminium cladding in Victorian buildings.

In October 2018 the Victorian Cladding Taskforce update put out to the market noted that their investigations “found dangerous materials are widely used on buildings throughout Victoria, a finding that is consistent with inquiries carried out interstate and internationally.”

Furthermore, the reports stated: • Visually identifying aluminium composite panels (ACPs) with a polyethylene core and EPS is difficult – even for highly qualified and experienced building practitioners. Destructive testing is often necessary • The maintenance of Essential Safety Measures (ESMs) in multi-storey buildings requires improvement.

• Building owners face increased insurance premiums and reduced property values while combustible cladding remains on a building.

The taskforce confirmed that 15 buildings in Victoria received emergency orders for urgent short-term remediation work to make those buildings safe to occupy. These measures include installing sufficient detection and warning systems, installing sprinklers and removing ignition sources.

Building notices asking owners corporations to “show cause” why combustible cladding should not be removed, were issued for around 150 buildings assessed as part of the pilot and the statewide audit.

Owners Corporations began receiving these emergency orders under section 102 of the Building Act. These orders typically provided the Owners Corporation with a period of just 7 days to engage a suitably qualified person to determine the types and locations of combustible cladding and insulation used as well as to provide test reports from an approved testing authority confirming the type of cladding which has been used on parts of the external façade.

These unrealistic timelines are unable to be met by the vast majority of buildings served with such orders. It can takes weeks just to arrange an appropriately qualified Fire Engineer or Building Consultant to attend the building for an initial assessment an so extensions must be sought from the authority who issued the order in the first place.

Owners were asked to cover the cost for these consultants to attend site, provide reports, obtain test samples and have these samples sent off for destructive testing. Once the results of these tests were obtained, further risk assessments are required to be prepared.

The result of all this – a report stating that combustible cladding was used. But who is to blame? Who covers the cost of the remediation works & the investigatory costs?

The frustration for many owners and Owners Corporations is the lack of hard facts and practical action plans being put in place to resolve the issues facing millions of owners.

On the 16th July 2019, the Premier of Victoria and the Minister for Planning announced the establishment of Cladding Safety Victoria.

Cladding Safety Victoria is tasked with the responsibility of rectifying higher risk buildings identified by the VBA through the Statewide Cladding Audit.

Due to the large number of buildings affected by combustible cladding, Cladding Safety Victoria is already tempering expectations of a quick fix noting that “the process of rectification across Victoria is expected to take at least five years. The timing of when buildings are worked on depends on many factors including risk.”

Premier Daniel Andrews announced a $600 million package to fund the Victorian cladding rectification program. The cost to tax payers will be clawed back in part by introducing a levy on building permits for larger buildings with works worth more than $800,000.

Consumer advocates such as the Victorian Building Action Group believe the true cost of fixing the state's cladding issues will likely reach the “many, many billions of dollars”.

The Owners of these affected buildings need Government to enforce the laws and regulations that exist with penalties applied when people ignore those laws.

WHAT THIS MEANS FOR OWNERS Whilst all this plays out in the political arena those exposed or involved in buildings with combustible claddings face an uncertain future. Insurance premiums and excesses are increasing at alarming rates, surveyors and architects are typically loathe to provide further information for buildings previously completed for fear of self-incrimination, essential safety measures are being meticulously reviewed and managed and all information is now being included in Owners Corporation certificates making sales within these buildings difficult if not impossible.

Owners Corporation Managers need to be communicating with stakeholders, working with their committees to ensure the right consultants are engaged to offer advice as to how best to deal with any non-compliant cladding found to be installed on their buildings.

Once the materials are known it is prudent for Owners Corporations and their consultants to lobby Council and investigate if performance solutions can be undertaken rather than simply removing the cladding altogether.

In the midst of this cladding crisis, it is vital that an affected Owners Corporation is able to lean on experienced professionals to able to help them navigate through the uncertainty. This starts with the Owners Corporation Management company who should be able to introduce the Owners Corporation to the relevant professionals who can forge a path forward in the best interests of the owners.

— Bryan Phillips Director PH: +61 412 678 166

9

Apartment ‘Must Haves’

10

Latest must-haves in new apartment buildings.

There is a current trend of apartment living that stem from owner/occupier. Apartments designed for owner/occupiers in mind, ensure a different design layout and sense of purpose as the buyer will use the space.

These must haves include larger layouts and ample storage opportunities. These spaces are designed to be used as the new age ‘family home’ which means the space, although compact compared to the typical family home needs to incorporate all the modern conveniences a traditional family home has- on a compact scale.

The level of sophistication and customisation is becoming more and more popular with ‘added extras’ becoming standard, such as in built joinery throughout including fireplaces that create a homely feel.

The trend of owner/occupier and larger layout extends to multigenerational purchasers. It is a major growing trend in the industry.

Currently, CHT Architects are seeing multiple generations within families purchasing apartments in the same building. There is a trend within apartment living to have a variety of apartment layouts and sizes to suit a variety of owner/occupier’s needs.

CHT Architects Director David Carabott says, “the pattern emerging of multi-generational purchasing has had an impact on the way we design, the inclusions are crucial to incorporate the needs of purchasers that range in age, way of life and financial flexibility”.

buildings, have an expectation for communal spaces. These multi use spaces like rooftop gardens and decks as well as wine bars are important particularly to create a sense of community.

Other facilities that are becoming more of a prominent feature are wellness centres and hubs dedicated to exercise and gym amenities Natural light and access to open spaces is also a large factor in CHT Architects designs and layouts.

CHT Architects are also seeing a growing demand for home automation. The popularity for home automation is increasing, the price point for products and installation has lowered which allows more purchasers to enjoy the comfort, ease and convenience of home automation which includes voice activated lighting and control of blinds and air conditioning as well as remote access via an app.

Due to the general direction in the market being owner occupier we are seeing a pattern move towards a non-traditional family home in the compact style of apartment living. This type of living is a lifestyle which encourages interconnectivity.

— David Carabott Director, CHT Architects PH: +61 3 9417 1944

Communal facilities are a huge drawcard for potential purchasers particularly in the owner/occupier market. There is a lean toward additional amenities that do not have a huge body corporate impact.

These additional facilities that connect communities and families include; private dining and in house cinemas. Generally, these facilities are able to be booked out via an online portal for residents and their guests to enjoy.Purchasers, including families, living in these apartment

11

Interior Directions in Multi-Residential Des

A well designed interior at its very core, starts with good planning.

Our very primary focus at Adele Bates is to ensure all residential projects we work on are planned efficiently with attention being given to ensure there is adequate space for every function of modern life.

The spaces flow in a rational manner and allow for a variety of moments and events. Living spaces are large enough to stretch out in, separate study nooks are allowed for where space for a formal study is limited and bathrooms allow for generous storage as well as ample bench space for the myriads of products we now use.

The kitchen continues to act as the heart of the home and with the constant evolution of technology and appliances is working harder than ever. A butler’s pantry is a prized companion to any kitchen and is even more valuable where it can house an additional sink and dishwasher.

The importance of adequate storage is also a key design factor.

12

We look for clever ways to integrate storage throughout a space without taking too much away from the living zones. Natural light is an integral element to any well designed space, and the layout and orientation of internal areas is a direct result of how natural light travels through the space.

Once the bones of the design are established, our attention moves on to the experiential aspect of the space. The old adage of timeless design is very much at the forefront of our approach to design. Whilst there is definitely space for fun, colour and a trends based approach to other sectors of the design world, we have found that residential design leans more strongly into the realm of design for longevity.

Natural materials, elegant forms and the emphasis for human scale play an important role in any scheme with a focus on enduring design.

Colours are rich and earthy. Natural timbers and stone can always be relied upon to add a layer of sophistication and warmth to any space.

We are also seeing a continued direction of using materials in more unconventional applications such a timber floorboards on walls and ceilings and metals in joinery.

sign

Space and light and order.

Those are the things that men need just as much as they need bread or a place to sleep.

- Le Corbusier

Natural stone is a great way of introducing colour into the built form.

We focus on selecting stones in deep and often muted hues with a strong character and figuration. In this way, the piece of stone becomes an artwork in its own right, from which the rest of the colour palette can flow and evolve into the soft furnishings and homewares.

The finish is also of great consideration. Whilst glossy finishes exude a level of glamour and luxury, and honed finishes have an understated minimal feel, we are increasingly interested in introducing tactile finishes into the space. Whether it’s hammered metals, leathered stone or textured laminate, all of these elements act to stimulate the sense of touch and encourage a deeper connection with the interior.

neutral but voluminous in form, adding softness to clean and minimal interiors. This juxtaposition of textures and layers is what gives our homes a human touch. This is the difference between a clinical cookie cutter fit-out versus a carefully curated and considered space.

Another great way of building upon the layers and textures, is to carefully consider the way in which lighting can bring a space to life.

We are less and less interested in a uniformly lit interior and a ceiling splattered with downlights. Pendants, loose lamps and wall sconces provide the opportunity to create unique moments and multiple moods, as well as inject a level of personality and distinctive style into a home.

With the myriad of quality apartment and townhouse offerings currently on the market, it remains vital to strike a fine balance between a unique design language and aesthetic, a point of difference, whilst at the same time allowing the built form to be a recessive canvas, ready to absorb the personality of the new occupant.

As trends come and go, one thing remains constant; Quality design and careful execution will always be here to stay.

— Adele Bates Director PH: +61 422 238 424 adele@adelebates.com.au

Soft furnishings such as furniture, window furnishings and rugs are the domain where colour can start to make it’s mark. The loose nature of these items makes them the perfect canvas for some fun and experimentation as they can be changed up and rotated as trends come and go. We are seeing a strong move towards lustrous velvets in deep tones of navy, red and emerald. Window furnishings remain

13

Advice from ASK Planning So, new financial year, a more optimistic market and you are now thinking of developing your land.

You know what you want to achieve. You also consider that you know just how to achieve it. This is a great start.

You would agree that no two sites are ever quite the same, so some caution is necessary. Due diligence has never been more essential.

The planning stuff and things that can arise may be significant or subtle but either way, the ultimate decision of Council or VCAT may turn on critical or threshold issues best thrashed out from the beginning.

So, before you get to the official start line, let’s get back to basics.

As a valued ASK client, let’s consider some of the ‘land mines’ together.

What title particulars do I need?

Obtain a current Certificate of Title through the Section 32 Vendor Statement (section 32) or online at landata.vic.gov.au at a fee. This must include a Register Search Statement, Copy of Plan and Instrument of Transfer. We can then check for registered covenants, easements, legal agreements, carriageway easements (for lane/road abuttals) and the like. We will advise if you need legal advice.

We also recommend you search services such as power, gas, water and telecommunications affecting your land using Dial Before You Dig (DBYD). Lodging an enquiry is simple, free and will assist locating any infrastructure assets. It is also advisable to contact Council’s Drainage and Asset Engineering Departments to discuss assets and easements.

What about the planning controls?

Up front we suggest you obtain a Planning Certificate (a legal document confirming the zoning and applicable planning controls that affect the development of your land). This too can be obtained online at landata.vic.gov.au at a fee or it should form part of the Section 32.

Once the controls/overlays are checked, we then recommend an online search for any proposed or current neighbourhood character studies which form the basis of a proposed Planning Scheme Amendment for a new zone/overlay/schedule standard. These are not always identifiable in a Planning Certificate. Our in-house ASK detective Effie Tangalakis, Senior Associate is a great detective on this front.

Do you recommend a Due Diligence period if I am purchasing land to develop?

Yes. Ideally no less than 4 weeks if you want some meaningful Council officer feedback following a massing/yield study by an architect or designer/draftsperson. Your planning consultant will assist advising the designer with the various investigations and checks as outlined.

If there is any potential for contamination, this may also need further investigation by an accredited environmental consultant.

Any other allied professionals required?

In many cases we require that an arborist review trees on your land and adjoining land early on, including street trees. This applies whether vegetation controls exist or not.

Other allied consultants relied upon may include land surveyors, traffic engineers, heritage architects and architect/designer for massing and yield studies. It will depend on the nature of the project, planning controls in place and other site/contextual factors.

Do I need a survey up front?

You will most certainly need a re-establishment and site feature survey for your planning permit application. Ideally, this is obtained at a very early stage to accurately inform the architect/designer for concepts, yield/massing studies, floor levels, height and the like.

Site inspection will also reveal various adjoining considerations including matter such as solar panels, power poles, street furniture/ assets, street trees, neighbouring trees and fencing.

14

Is the land prone to flooding?

The land may be affected by a flooding overlay in which case it is essential to establish the applicable flood levels and investigate any other requirements of the floodplain management authority. This could be Melbourne Water or even your local Council with a local flooding control. Be sure to check with both.

No flooding overlay shows up in your search? Don’t be so sure…

Melbourne Water may have recently changed its flood mapping.

Obtain a flood level certificate online at landata.vic.gov.au and contact Melbourne water direct.

What if there is site history?

It is always worth checking Council online registers or calling the Planning Department direct to establish any permit history. This may also extend to a VCAT history and influence your project process and outcome.

If there is a planning permit attached to the land and you are considering amending the permit/plans, it is also advisable to consider if an extension of time to commence has been granted or needs granting, as well as considering if planning controls, standards and/or policies have changed since the grant of the planning permit.

To do this to great effect, James Stuart-Menteth Associate at ASK recommends you apply our 4 golden rules: Step 1.

Choose to work with a reputed planning consultant from the start.

Step 2.

Trust their advice, after all it is in your best interests to get the right result.

Step 3.

Implement their advice throughout the process.

Step 4.

Be patient, the system is not built for speed or certainty.

Where to from here?

Who are we?

Having carefully navigated the issues early and spent a little more time up front, you’re sure to improve the certainty and predictability of the process at Council or VCAT.

ASK Planning was established in 2012 and comprises a team of 4 including Stephanie Laurin (Interior Design). Combined we have over 50 years of experience in town planning, with 40 years in Local Government.

As a planning advisory and advocacy service, our role at ASK is to advise without fear or favour; challenge conventional thinking whilst seeking to work collaboratively with stakeholders; share with you our knowledge and experiences; research and explore solutions; reduce uncertainty; pass on the news (mostly good but not always); professionally advocate on your behalf; and project manage given the range of allied consultants forming part of your project team.

We manage a diversity of projects large and small in residential, aged care, child care, medical, hospitality, commercial and mixed use across Victoria as well as 60 – 80 cases at VCAT annually. Increasingly strategic work including rezoning and master planning has formed part of our recent scope of work.

— Mark Stanojevic Director, ASK Planning Services PH: +61 414 799 558 mark@askplanningservices.com 31 Mills Street Albert Park

15

What Developers should look for in a Ven We often are asked to review contracts of sale and vendor statements for developers looking to purchase development sites.

The Vendor Statement in particular is often the starting point for a developer’s due diligence enquiries and it is critical that developers understand what they are looking for and how it may impact their decision to acquire the property, how it will impact their plans for development and what issues need to be negotiated with the vendor Some key issues which we often need to advise developers on are as follows: Title Issues It seems like an obvious question, however, it is surprising how often there can be question marks around whether a vendor in fact has the power to sell. This may be to do with a number of factors such as family law issues, deceased estate issues contractual issues, bankruptcy issues.

Ultimately, a developer needs to consider whether any of these issues will affect the vendors ability to pass on clear title to them if they buy the property.

There may also be easements on the land which allow third parties, rights of access or carriageway which may also affect what parts of the land can be built on and what parts of the land may require permission to build over. Drainage and sewerage easements are a common example where permission is required from the water authority to build over such easements.

Council planning instruments will also always be a key factor for developers to consider. Zoning restrictions may inhibit certain sorts of development from occurring and whilst planning laws are constantly changing and developing a prudent developer needs to assess carefully whether their vision for their development will be reasonably accepted by the council and the local residents without significant objection Lease issues Leases over development property can be a blessing and a curse. They can be a blessing insofar as they can provide income to a developer pending the preparatory stages of development, however they can be a curse if there are difficulties in being able to bring leases to an end without causing undue delay to a development.

Particularly, where there are commercial leases in place, it is important to check:

Use issues

When the leases expire, whether there are any options for renewal;

Similarly, there may be a number of other legal restrictions which affect a title which may not affect the developers ability to acquire the property but may have a significant impact on how a developer can use the property.

»» If the leases are retail leases governed by the Retail Leases Act 2003, whether in cases where the length of a lease is below the minimum 5 years and if so whether waiver certificates have been obtained by the vendor, noting that in the absence of the same the tenant may be entitled to a full five year lease; »» Whether the lease contains any early termination clauses such as demolition clauses and what the terms of the same are (eg. do they provide for compensation to the tenant which may become a liability for the incoming purchaser); »» Is the developer entitled to the going concern exemption? Are all parts of the property let out and or do some need to be actively marketed for letting in order for the going concern exemption to apply?

Restrictive covenants may exist on the title of a property which may restrict the use of the property. In certain areas, there are often covenants which restrict the ability of an owner to subdivide the property or build more than one building on the land. Whilst these covenants may be removed, the process of doing so may be prohibitively expensive.

16

Are their restrictions on the depth of development? Many properties have depth limitations and this may inhibit the construction of things like basements or underground car parks.

ndor Statement

Environmental issues What has been the prior use of the property and are there any environmental issues as a result? Remediating contaminated land can be costly both in time and money. Does there need to be testing carried out to ascertain the risk?

Is the property at risk of pest infestation, flooding or bushfire?

Are there special building requirements as a result?

Is the property subject to future development projects by the government which may affect the zoning or which may make the property subject to compulsory acquisition?

Building Issues Does the condition of the building present any risk to a developer?

Most contracts of sale provide for the risk of any building notices to fall on the purchaser as and from the day of sale.

The above are just some of the considerations and issues we have been asked to advised developers on in the context of reviewing vendor statements. In most cases depending on the answers to the above queries, special conditions will need to be negotiated in order to protect a purchasing developer’s interests.

Should you be a developer needing assistance in relation to the acquisition of a development site, we recommend that you speak to one of our property and construction team.

— Jeremy Quah Senior Associate, TLFC PH: +61 3 8600 9333 jquah@tlfc.com.au

Does the state of the building affect a purchaser’s ability to insure?

Is any aspect of the existing building affected by heritage restrictions and if so how will that affect the development?

Is the property subject to an owners corporation? If so will the developer obtain sufficient control of the owners corporation to enable it to carry out its plans?

17

Past Project Profile

Hotham & Carlisle 99 Hotham Street St Kilda

9 Shuter 9 Shuter Street Moonee Ponds

18

Type

No.

% of Total

Average Size per m2

Average Price per m2

Average Price

1 Bed, 1 Bath (Apartment)

3

10

61.7

$8,194

$505,000

2 Bed, 1 Bath (Townhouse)

1

3

81.0

$10,185

$825,000

2 Bed, 2 Bath (Townhouse)

25

86

92.6

$9,298

$862,580

Type

No.

% of Total

Average Size per m2

Average Price per m2

Average Price

1 Bed, 1 Bath

22

36

49.6

$8,200

$406,955

2 Bed, 1 Bath

4

7

61.0

$9,033

$551,000

2 Bed, 2 Bath

26

43

73.3

$8,530

$625,538

3 Bed, 2 Bath

8

13

118.1

$11,095

$1,307,500

4 Bed, 3 Bath

1

2

144.0

$11,806

$1,700,000

Past Project Profile

Parq 134-138 Mckinnon Road Mckinnon

Central Park 2a Nyora Street Malvern East

Type

No.

% of Total

Average Size per m2

Average Price per m2

Average Price

2 Bed, 2 Bath

21

95

81.8

$8,114

$663,405

3 Bed, 2 Bath

1

5

101.9

$8,391

$855,000

Type

No.

% of Total

Average Size per m2

Average Price per m2

Average Price

2 Bed, 2 Bath

5

26

103.8

$12,138

$1,258,600

3 Bed, 2 Bath

14

74

164.6

$13,936

$2,307,000

19

Celebrating over 120 Successful Sell Outs

+ 61 3 9822 9999 1111 High Street, Armadale VIC 3143