Alarm after Block’s developer taken to court for alleged shoddy work

Published 11 April 2016

By Nakari Thorpe

Source: SBS News

The Block redevelopment will include 62 affordable homes for Aboriginal people Source: AAP

Deicorp, the developer contracted to re-develop the Block in Redfern, is being sued in the NSW Supreme Court over alleged million dollar defects in another residential property it has built in Inner Sydney.

Community leaders in Redfern are concerned.

“It certainly raises a red flag. To put vulnerable Aboriginal people in the hands of a company who is being challenged in court is a bit worrying,” says Brownyn Penrith, Redfern resident and Chairperson of the Mudgin-gal Aboriginal Women’s Centre.

Deicorp has been taken to court for alleged defected work in one of its prime apartment complexes in Sydney’s inner west. Residents are accusing the developer of water damage, mould and dampness, and holes in ceilings.

The company has disputed the claims, claiming the defects are because the residents have not kept up maintenance works for the building.

Activist and Wiradjuri elder Jenny Munro, who set up a tent embassy on the Block to fight for Aboriginal housing, says this should be ringing alarm bells.

“If they’re gonna build apartments [like these] for white people, imagine what they’re gonna build for blackfullas, this reinforces the concern of the community. It just shows how wide the divide is, the fact that developers have a say in [the redevelopment of the Block]” Ms Munro says.

It’s not the first time the developer has been at odds with members of the local community. In 2014 Deicorp created a furore when they released an advertisement saying “the aboriginals have moved out”, spruiking the exit as a selling point for luxurious apartments in Redfern, leaving Indigenous leaders ‘gobsmacked’ and ‘outraged’. Deicorp said it was an error on behalf of a hired Chinese marketing firm.

‘Outrage’ over Redfern apartment advertisements

And now Deicorp is contracted to develop a multi-million dollar redevelopment at the Block in Redfern, just two kilometres from the city. The project will consist of 62 affordable homes for Aboriginal people.

In a statement provided to SBS News, Deicorp say the allegations do not affect the proposed redevelopment of the Block.

“…Deicorp has had a long-term relationship with the Aboriginal Housing Company. The AHC is the landowner and developer of the Pemulwuy project, while Deicorp is only appointed as the builder, nothing more,” it stated.

Ms Penrith, who is hoping to get on the waiting list for one of the 62 homes, is also concerned Aboriginal residents would not have the same opportunity to take the multi-million dollar developer to court if faced with the same problems.

“We don’t have choices, we’re just happy to have a home. A lot of these places do not accommodate to Aboriginal people or compliment our lifestyles. I’m very concerned a bit of wear and tear could be blamed on Aboriginal people and then we’re kicked out,” Ms Penrith says.

Activist and Wiradjuri Elder Jenny Munro set up a tent embassy in Redfern to fight for afforable housing for Aboriginal people in the Block’s redevelopment Source: Getty Images

However, the Aboriginal Housing Company (AHC) who is the landowner of the Block, say they are not worried about the allegations.

“We’re not concerned at all. We’re aware of the their work and legal proceedings [of Deicorp] but it is not for us to comment on,” says AHC General Manager Lani Tuitavake.

“We’re not a government organisation, we have our own best practices. We’re confident in Deicorp,” she told SBS News.”We’ve had a great relationship since 2009.”

Residents sue Deicorp for alleged failings

Today, Deicorp is currently being sued in the NSW Supreme Court over alleged million dollar defects in one its most highly-sought after buildings.

Frustrated apartment owners in the developers’ Star Printery apartment complex in Erskineville, in Sydney’s inner west, say the building’s issues are unacceptable.

“It’s just disgusting how that can be done” says Andrew Morley, one of residents of the three-storey building.

“We [residents] are disgusted that this is allowed to happen. We all live an honest kind of a life and you have builders that are just out to make the next money and move on to the next complex and buy the next land” he told SBS News.

1,424 likes
andrew_j_morley

I am sick of the system failing the honest people. Check them out: DeiCorp.com.au – This multimillion dollar organisation that operates under dozens of ACN’s hasn’t stopped building since we took them to court years ago. They only recently put the company we were filing against into administration, however they have never followed through with it. Instead they offered us 100K, which is not even 10% of the cost to get the building back up into safe living conditions- OH and a gag order to shut the owners up from talking negatively about them- HAH!
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#DeiCorpConstructions should be ashamed. We have residents that have been advised by doctors to live elsewhere because of the mould ingress as a result of wrongly installed bathtubs. We have dogs ripping their paws because of raised nails in the decking. We even had the power short out because of water intrusion into a power point. And then the constant discomfort and health issues we are faced with- living in mould infested walls, rotting floor boards and damp carpets. And here’s a sexy image for you, I have to shower with my door open as like many other owners, because there isn’t even an exhaust fan fitted into our bathrooms as they never created an extrusion vent for the steam.
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I love how in this article #Deicorp Constructions Pty Ltd say that the rotting of over 50% of our deck is due to lack of maintenance, where Jessica Ribbon says “they blocked the bloody drain”. However there is no access points or anyway to get to the drains under the decking. So the only way is to rip up the deck. MAKES TOTAL SENSE?!! The joists and boards are rotting everywhere, how about meeting the #AustralianStandards and use the right materials? It is an absolute disgrace with what #DeiCorp is trying to get away with.
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The frightening thing is that we are not alone, DeiCorp has other apartment facilities that also have defects and water issues. They have aged care facilities, shopping centres and community centres all around Sydney- so it’s a real worry. HOWEVER they have just been awarded by AHC (#AboriginalHousingCompany) to build the $70million #PemulwuyProject in #Redfern. .
If anyone can help, let me know??

And efforts to receive compensation for the alleged defects is being hindered by the company changing both its shareholdings and its name.

According to the Sydney Morning Herald, Deicorp allegedly registered a change in its members’ shareholdings with the Australian Securities and Investment Commission (ASIC) four months after the defects action was lodged in court. Then in July, it changed its name to its ACN number. 

A spokesperson from Deicorp told the Sydney Morning Herald that the name change to their ACN number is  “stock standard accountancy procedure”. Although companies are entitled to make such changes at any time, residents feel it is too much of a coincidence.

In an Instagram post Mr Morley, a former Home and Away actor, accuses the developer of operating ‘under dozens of ACNs’ and tells of the ‘constant discomfort and health issues’ faced by residents from ‘mould infested walls, rotting floor boards and damp carpets.’

Residents are accusing the developer of work that has left walls and floors with water damage and dampness, holes in roofs, and mould and rot throughout. On Deicorp’s website, the eight-year-old, 46 unit apartment complex is described as ‘fabulously chic’ transformation from a once abandoned warehouse.

“I thought it was all great until I started to smell a bit of dampness and realised that during heavy periods of rain there was water running down from the top of my roof down the wall under my carpet. After those big downpours, weeks later would be mould ingress, mould would just grow across the wall, on everything,” Mr Morley says.

Images from the inspection report reveal mould, water ingress and holes in ceilings Source: Supplied

An inspection report from 2012 reveals bathtubs were not installed correctly causing water ingress and instead an alternative method was used, and intreated hardwood to build the decking has caused it rot and mould. 

A building inspector reported, “over 50% of the baths internally were holding water”, and “silicone is not approved as a waterproofing material or membrane in its own right. It is my experience that any silicone membrane applied in this matter will ultimately fail over time.”

It said of the decking: “I was able to place my hand around the hardwood timber and wring the

timber out as if it was in fact a sponge.”

The report goes on to list a further 146 nominated defects where the builder has potentially breached the Building Code of Australia.

Despite the claims, the developer says the matter has been resolved.

In their statement to SBS News, Deicorp say the developer and “the owners corporation have resolved their respective disputes on mutually acceptable terms and reached an in-principle agreement.”

Another resident of the Star Printery complex was ordered by her doctor to move out because of the risk to her health. The cancer sufferer, who lived in the apartments for the past 12 months, was advised by her oncologist to move out as concerns over mould spores could potentially prove deadly as she recovers from surgery.

The resident has since moved out.

In another blow, apartment owners have also been forced to fork out additional levies, with some owners already paying at least $6000 for additional levies when payments are usually $350 per quarter.

Bitter feud at the Block

Deicorp was awarded the contract to re-develop the iconic Block in 2010 and the project has since caused community upheaval.

The AHC awarded the contract to Deicorp to undertake a $70 million redevelopment on 10,000 square metres of valuable vacant land in Redfern, the long-associated heart of Indigenous Australia.

Artist impression of the Pemulwuy Project, the redevelopment will comprise of 62 apartments and over 9,000sqm of commercial retail community and cultural space Source: AAP

According to AHC’s website, the Pemulwuy project is to include affordable housing for 62 families, a gymnasium, commercial and retail space, a gallery, student accommodation for 154, and a childcare space for 60 children.

But the project has divided the community. Concerns about the commercial half of the project taking precedence over housing has caused friction.  

Many Indigenous leaders have accused the AHC, an independent not-for-profit charity, of losing its vision of housing its core client, Aboriginal people, and succumbing to the lure of commercial enterprise. 

“It’s satisfying the corporate needs of white Australia, not satisfying the needs of the Aboriginal community and now we’re being forced out of the community,” says Ms Munro.

Related reading

Explainer: Redfern Aboriginal Tent Embassy and Aboriginal Housing Company dispute

The AHC was set up as a direct response to the widespread discrimination Aboriginal people and families experienced in the private rental market. The block of land was handed back to the Indigenous community by former Labor Leader Gough Whitlam in 1972.

It was also the first community housing provider in Australia, incorporated in 1973, and is listed as a company limited by guarantee.

Ms Munro set up an Aboriginal Tent Embassy on the Block, in 2014, to protest the development until affordable housing was prioritised for Aboriginal people.

Last year, members from the Tent Embassy and a large group of supporters flooded into the building of Deicorp’s offices in Redfern chanting, “Deicorp, Deicorp, we won’t stop – get your hands off the Block!”

A 30 minute sit-in ensued, however Deicorp officials refused to meet with the group and their leader, Ms Munro.

But then in August of last year, after 15 months of defiance, the tent embassy successfully claimed victory after the Federal Government promised to secure funding and prioritise affordable housing for Aboriginal people.

Indigenous Affairs Minister Nigel Scullion guaranteed finance for low-income housing that will see $5million in Federal funding put towards the 62 new affordable homes.

“… Everybody wants on Aboriginal land, affordable housing for Aboriginal people, that’s what they decided to do with the block, and I think that they have a much higher level of confidence that that’s going to happen,” Mr Scullion told NITV News.

Ms Munro told NITV News the year of struggle had paid off.

Jenny with other Elders at the Block Source: AAP

“The work that was done to secure the $5 million for housing for this place was not done by the Aboriginal Housing Company it was done by the Aboriginal Tent Embassy and the people who supported us here for the 15 months.

“So I want to say, firstly, thank you to all those supporters they’ve done a magnificent job under very very trying conditions,” she said.

A history of controversy

This latest debacle of the Star Printery is just the latest in a string of incidents the developer has been caught up in.

• In 2014, Deicorp caused controversy when an advertisement for the company’s Dei Cota complex claimed the Aboriginal people had moved out, spruiking it as a selling point. “DeiCota has good rental return and convenient location. The Aboriginals have already moved out, now Redfern is the last virgin suburb close to city, it will have great potential for the capital growth in the near future,” stated on Chinese marketing firm Great Fortune Investments website.
  
  
  
• DeiCorp is set to benefit from the multi-million dollar Sydney Metro line at Waterloo. An urban renewal project that has met severe opposition. Community members say it is a push to move the poor people out and private housing in
  
  

• The Sydney Morning Herald reported of a woman narrowly missed being struck by falling scaffolding in her workplace. The woman was in the bathroom of the cafe in Redfern when a beam crashed through the door from 10 storeys high from a construction site being built by Deicorp.
  
  
  
• The developer won their application to build Deicorp signage, four permanent illuminated signs on the roof of a mixed-used building, in Redfern. It follows appeals by the City of Sydney Council, who did not consent to the display, and three residents, two of whom provided oral evidence in court citing intrusiveness and proximity to their houses. In the end, Deicorp were granted their application to build the signage.
  
  
  
• In a latest twist, Deicorp has reportedly been linked to leaked documents from law firm Mossack Fonseca based in Caribbean tax haven Panama, dubbed the ‘Panama Papers’. The company told FairFax Media they had never heard of their BVI company Fitall Development Ltd, which was set up in 2008. Deicorp denies any involvement.
  
  
  NSW links to tax haven companies through ‘Panama papers’ law firm Mossack Fonseca by Kate McClymont and Patrick Begley, April 5, 2016
  

DeiCorp’s current developments include an aged care facility in Randwick, and residential apartments in Canterbury, Meadowbank and Kellyville.