Five years, millions of dollars: The battle to fix a defective Sydney building

Five years, millions of dollars: The battle to fix a defective Sydney building Andrew and Lisa Cook moved into their new apartment in Baulkham Hills on December 12, 2020, expecting a modern lifestyle with a sprawling balcony offering views of the city skyline and proximity to shops. Just 23 days later, their dream turned into a nightmare when the company developing their building, Hills Shoppingtown Pty Ltd, collapsed. Ten months after that, the New South Wales building regulator identified serious defects in the development, including one deemed a “hazard to human life.” The Cooks were shocked and unsure who would be responsible for repairs. “We were a bit scared because they didn’t know what was going to happen at the time,” Lisa said. Known as the Modena, the four-tower project was developed by Hills Shoppingtown Pty Ltd, a subsidiary of Dyldam Group, once one of NSW’s largest apartment builders before collapsing with debts exceeding half a billion dollars. The development included 230 apartments and plans for a retail precinct, aiming to blend luxury with comfort. However, inspections revealed the site was far from the envisioned vision. Non-compliant waterproofing, an awning in danger of collapse, balconies lacking proper water overflows, and a rusted, leaning glass elevator were among the issues uncovered during visits by receivers and regulators. Over five years, the Cooks and a small group of other residents have lived in a construction zone as millions of dollars were spent addressing defects. The scale of the work has been so extensive that the couple has resided in another unit since January while repairs continue on their own apartment. “There’s been a lot of noise for quite a few years, so that’s sort of a bad thing, but I keep thinking they’re doing it, they’re fixing it, it’s not costing us any money,” Andrew said. The Baulkham Hills building, previously called the Modena, remains under active repair. The stairs to the lower level are still fenced off, indicating ongoing work. Residents describe themselves as “one of the fortunate buildings in Sydney,” though buying a home with defects is not unusual in NSW. The Building Commission NSW recently ordered major developer Bathla Group, which entered voluntary administration last month, to address serious defects in two of its projects. This has left buyers uncertain whether they will ever move into their homes. The $70 million fix When McGrathNicol was appointed receiver of the Modena development in 2021, partner Jason Ireland said they were told the project was 95 percent complete. However, what was expected to be a straightforward task evolved into a massive undertaking requiring years and $70 million to correct defects, raising the total completion cost of the development to $185 million. Ireland described the project as akin to an onion, noting that peeling back layers revealed more problems. Over 60 defects were identified across the four buildings. Fixing overflow holes in balconies initially seemed simple. But as tiles were removed, a new issue emerged: no one could determine what waterproofing material had been used. Ireland confirmed it was a non-compliant product. “We eventually got to the conclusion that the only way to actually get the sign-off in the end was to rip up the balconies, replace all of the waterproofing, and replace all of the tiling, which is a lot because there’s over 200 apartments,” he said. Throughout this period, the four buildings have remained partially occupied. A process resembling Tetris has required residents to be relocated frequently as work progresses.