BUILDING REGULATIONS
Property Council has brought together four key industry and peak bodies to elevate concerns about the inconsistent approach of State and Territory governments to enforcement and compliance of building regulations and audits of buildings with combustible cladding and rectification works.
The Property Council, Master Builders Australia, Insurance Council of Australia, Ai Group and Australian Construction Industry Forum wrote to Federal Minister for Industry and Chair of the Building Ministers Forum (BMF), The Hon Karen Andrews MP, to urge the Federal Government to play a leadership role, convening State and Territory governments to:
- Develop and implement a consistent and best practice Australia-wide response for risk assessment and a rectification strategy for existing buildings with combustible cladding with an agreed timetable that reflects the urgency of the issue.
- Establish a joint government-industry taskforce to oversee urgent and consistent implementation of all Shergold-Weir report recommendations across all jurisdictions.
Following the Building Ministers Forum which was held on Thursday 18 July, the Building Ministers along with the key industry bodies have agreed to deliver a consistent approach to enforcement and compliance of building regulations that the industry has called for since the Shergold Weir report was released with 24 recommendations for reform.
The Property Council will work closely with Commonwealth, State and Territory governments to consider the detail of the BMF’s commitment to an implementation team within the ABCB to drive reforms on enforcement and compliance. Property Council will also work closely with its National Risk Roundtable and National Building Regulation Roundtable to inform next steps for advocacy in working with governments and industry.
On a state level, the NSW Property Council team have been busy working with members and the wider industry to gain feedback and make recommendations as part of its submission to the NSW Government’s Building Stronger Foundations – Discussion Paper which was released last month.
This discussion paper takes the first steps in implementing the NSW Government Response to the national report Building Confidence: effectiveness of compliance and enforcement systems for the building and construction industry across Australia, prepared by Professor Peter Shergold AC and Ms Bronwyn Weir. It includes a status update on the 24 recommendations in the report as well as expanding on the four additional reforms that were announced in the NSW Government Response.
The NSW Government has said that they will be appointing the NSW Building Commissioner soon.
Read the discussion paper here. The Property Council’s submission is here.
CONSULTATION ON RETIREMENT LIVING BUYBACKS
The NSW Government has released a Retirement villages – exit entitlements and recurrent charges cap discussion paper for public consultation. This paper examines the Government’s election commitment to amend the Retirement Villages Act 1999 (the Act) to place a 42-day limit on the length of time villages can charge for general services after someone leaves.
The NSW Government also announced a policy to allow for the payment of exit entitlement, requiring payment by the operator within:
- 6 months of a person leaving a retirement village in metropolitan areas, and
- 12 months of a person leaving a village in regional NSW. The feedback to the discussion paper will be used to help shape the reforms and ensure that they reflect the needs of residents and village operators. The Property Council will continue to strongly advocate on this issue on behalf of the retirement living industry to the new Minister for Innovation and Better Regulation, The Hon Kevin Anderson MP, and the wider NSW Government.
- The Property Council has concerns about the impact of this policy on future investment in purpose-built seniors housing as well as the potential for a mandatory buyback policy to decrease the value of individual properties within retirement villages. A submission is being drafted in response to the paper and will be submitted with consultation with members.
Office Market Report
The latest Property Council Office Market Report has shown the lowest vacancy rate for Sydney CBD since January 2008, with the rate dropping from 4.1 per cent to 3.7 per cent in the six months to July 2019.
This vacancy rate demonstrates the continued growth and strength of the commercial office market in Sydney, with a large amount of office space coming online over the next couple of years. Around 63,000 square metres by the end of 2019 and over 131,000 square metres in 2020, is expected to enter the market.
Jane Fitzgerald, Property Council NSW Executive Director has said “there is no doubt that further political certainty following the NSW and Federal elections, and a strong NSW Budget 2019-20 have all had a positive impact on the property industry and show a solid outlook for growth.”
“However, the office market in the CBD needs a release valve – low vacancy and rising rents will increasingly impact our competitiveness as a global city with Melbourne benefitting and adding more supply over the next four years.
“We need a finalised planning regime for the CBD – one that encourages further supply and investment through defined and transparent development controls throughout our CBD to provide certainty to industry.”
Key market indicators, Sydney CBD (aggregate)
|
Grade |
Vacancy, Jul 19 (%) |
Vacancy, Jan 19 (%) |
Net absorption, 6 months to Jul 19 (sqm) |
Net absorption, 12 months to Jul 19 (sqm) |
|
Premium |
2.7 |
3.8 |
13,004 |
28,360 |
|
A |
3.2 |
3.6 |
4,114 |
5,086 |
|
B |
4.1 |
4.5 |
-9,142 |
-17,312 |
|
C |
6.2 |
4.8 |
-9,447 |
-13,721 |
|
D |
5.9 |
5.8 |
-2,152 |
-5,588 |
|
Total |
3.7 |
4.1 |
-3,623 |
-3,175 |
Macquarie Park and North Shore
The Office Market Report has shown that Macquarie Park office vacancy has remained steady, with vacancy for North Shore markets increasing mainly due to additional supply entering the market since January 2019.
Vacancy remains at 4.9 per cent in Macquarie Park, with almost 50,000sqm of office space set to come online in 2020 and vacancy in the North Shore increased to 7.2 per cent mainly due to around 44,000sqm of supply that was added to the market over the last six months.
In the North Shore, following an increase of office supply in 2019, there is a significant amount of office space of around 165,000sqm which will enter the market in 2020 and 2021. Demand remains positive in the area with 11,507sqm of net absorption recorded.
Jane Fitzgerald, Property Council NSW Executive Director has said, “With the completion of the North West Metro, there is a strong outlook for the North Shore, the increased demand has stimulated growth and created further opportunities for the industry, with a steady supply of office space in the pipeline for 2020 and 2021.”
“In Macquarie Park, demand is tempered and there is a lower amount of supply coming online over the next couple of years and with a decrease in demand overall, it will be interesting to see localised results over the next 18 months.
“Increasingly, we are seeing tenants look to locations with accessible transport and infrastructure already in place. Given tight competing markets, the need for infrastructure investment and good planning for the North Shore and Macquarie Park area will be vital to ongoing success.”
Read more about the Office Market Report here.
Key market indicators, Macquarie Park (aggregate)
|
Grade |
Vacancy, Jul 19 (%) |
Vacancy, Jan 19 (%) |
Net absorption, 6 months to Jul 19 (sqm) |
Net absorption, 12 months to Jul 19 (sqm) |
|
A |
3.8 |
3.6 |
-1,041 |
-1,713 |
|
B |
8.2 |
8.6 |
873 |
-1,979 |
|
C |
11.6 |
11.6 |
0 |
-230 |
|
Total |
4.9 |
4.9 |
-168 |
-3,922 |
Key market indicators, North Shore (aggregate)
|
Grade |
Vacancy, Jul 19 (%) |
Vacancy, Jan 19 (%) |
Net absorption, 6 months to Jul 19 (sqm) |
Net absorption, 12 months to Jul 19 (sqm) |
|
A |
6.3 |
3.1 |
-28,206 |
-12,813 |
|
B |
6.6 |
8.6 |
4,409 |
3,325 |
|
C |
8.8 |
8.0 |
-806 |
-5,117 |
|
D |
11.2 |
9.6 |
-398 |
-1,240 |
|
Total |
7.2 |
6.5 |
11,507 |
19,163 |