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Body corporate insurance

Discussion in 'Commercial Property' started by Stoffo, 6th Oct, 2016.

  1. Stoffo

    Stoffo Well-Known Member

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    I own a commercial/retail premises (It is leased, good tenant)
    It is on the ground floor of an apartment building, in the building there are 17 residential and 2 commercial units.
    The building is approx 8yo, was only strata divided earlier this year, i bought my unit in July and no mention was made about this issue :mad:

    I have received notification of a body corporate general meeting later this month to discuss a levy for repair works of over $30k (to be divided as per strata %) due to water/mould damage to one of the apartments caused by water/dampness from a window/sill/sealant problem.

    Shouldn't damaged caused in such a matter be an insurance claim ?
    Why wouldn't the strata managers pursue insurance.
     
  2. sydprop

    sydprop Active Member

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    Maybe you should join the executive committee and find out?
     
  3. Jerry O

    Jerry O Well-Known Member Premium Member

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    Also check if this could be covered by the developer's insurance? Worth a shot given its a fairly new property.
     
  4. Scott No Mates

    Scott No Mates Well-Known Member

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    @Stoffo

    $30k/19 units = $disaster/doom and gloom, the end is nigh.

    Who is going to contribute to the cost of repairs or replacement of kitchen exhaust ductwork from the other shop/office, I bet the other 17 unit owners will have a whinge too.

    Why are you paying lift maintenance if you're on ground floor and don't have a parking space? Why are the other owners paying aircond plant maintenance when only the offices/foyers are on house plant?

    The commercial premises should/could have been placed in a separate stratum otherwise all owners have accepted that they all will be sharing the running costs of the entire building.

    I have previously seen units over commercial/retail which have separate strata schemes ie residential had its own carpark, lifts, mechanical exhaust, building entry etc. The retail/commercial suites were on separate services (gas, power, water, trade waste...), own a/c plant, retail/goods lift, loading docks, garbage rooms, storage etc.

    Essentially, if they aren't in different stratum with different strata plans you will be sharing all common costs.

    So, go back to square one and confirm that the commercial suites are in fact in a different SP or all properties share one strata plan.
     
  5. Colin Rice

    Colin Rice Mortgage Broker Australia Wide Business Member

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    This is why you always ask for a copy of the last 2 years AGM minutes and financials pre purchase as they will tell a story that you will want to be in on before committing.

    Insurance company would likely say that its wear and tear that caused the leak there fore not covered.
     
  6. Stoffo

    Stoffo Well-Known Member

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    Thanks Colin, but at time of being offered for sale the strata was still being set up. As for wear and tear, reading the repair quotes its a toss up between building movement/cracking and poor design.
    @Scott No Mates I agree thats a great idea to split off the commercial side, but as its part of the same building i can see 17 objectors:rolleyes:
    Jerry O, i doubt there would be any developers insurance as its past 7 years :(

    Just thought I'd throw it out there so I will have more questions at the meeting later in the month.

    Thanks one and all :)
     
  7. Scott No Mates

    Scott No Mates Well-Known Member

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    @Stoffo

    It may need an unanimous decision and some reworking of common areas, creation of easements for services, separation of services etc to get two separate stratum and will cost $$ to achieve. So in this instance you may just have to suck it up & so will the others when your grease trap needs emptying or the drains are eroded by caustic pickle juices.
     
  8. Stoffo

    Stoffo Well-Known Member

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    Thanks all.
    Feed back time, went to the meeting Thurs, found out the selling agent was lying to me (imagine that hey o_O )
    The strata was set up and running in May 2016, I purchased in July 2016.
    The mould issue was reported in May also :mad:
    I have since returned on Friday and cut a few holes in the offending wall trying to source the origin of the water source.
    Without being able to hang off the side of the 4th floor, ive narrowed the problem down to either building movement (cracks in the paint work above) or the awning above (how it was affixed to the building).
    It doesn't help that this apartment appears to be the only one with no weep holes to the exterior :confused:.
    Anyway, looks like we will all be contributing to have the problem rectified.
    Cheers