Jan’s building has concrete cancer and harbour views. Developers try to persuade her to sell

One of the potential purchasers is agent-developer Ted Manny who bought two units in Merinda and approached three other buildings at McMahons Point to make offers on apartments and later sent a follow-up letter to Merinda.

“My report recommends that the building be deemed uninhabitable in its current state,” it read. “The deficiencies and non-compliances are many and, as an owner, I have a responsibility to circulate this report when in its final form and to file this report with the strata managers, North Sydney Council, NSW Fire and Safety and the building insurer.”

Manny admits sending the email with the comparison to the Titanic, but said it shouldn’t have been taken seriously. “I try to be humorous, but not everyone gets my humour,” he said. “That was a Dad joke.”

He also confirms that he filed the report with some of the authorities.

“When you become aware of serious issues in a building, you have a responsibility to do something about it,” he said. “Those issues could ultimately lead to loss of life in the event of a fire and because of the fire issues they won’t be insured.

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“But while I got a fire report done, I never furnished it to council. I just wanted to see what my exposure was in the building. The two owners whose units I was buying submitted those reports, not me.”

At one of those buildings Manny approached, the 1960s, 17-level, 81-unit Harbourside Apartments at McMahons Point, Owners Corporation chairman and barrister Brendan Hull said that Manny had been trying to convince people for two years to sell, but he couldn’t.

When the council later investigated the building and required a list of repairs, the building charged owners sizeable special levies to bring forward its schedule of planned works to get it back up to scratch.

“Now it will cost us millions of dollars to do the work. We were going to do it over a number of years, but then North Sydney Council said we had to do it within two,” Hull said.

“Then all the owners received emails from Mr Manny saying things like we were simply doing things like putting a coat of paint on the building which would be like partying on the decks of the Titanic, and we’d go down with the sinking ship.”

Manny said the vast majority of owners in the buildings were keen for him to buy, but there were a few “recalcitrant” owners holding out in the hope of receiving more than their units were worth.

“The majority of owners want to sell to allow these buildings, in prime locations, to be reutilised,” he said. “If I put my hand up to buy, they’d jump at it and name their first-born after me. But it only takes one or two owners to scupper the plans. It can be hellish trying to do this.

“I negotiate with everyone. I’m not someone who wants to see people thrown out of buildings. But people try to hold out and ask for 10 times what the other owners get, and I won’t do side deals or allow a few people to take the majority for a ride. And if you tell them their building is going to fall down, it’s literally going to collapse, they shoot the messenger.”

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Agent James Snodgrass of Forsyth Real Estate has been working with Manny on McMahons Point “to hopefully unlock a pretty incredible little spot down there”, Snodgrass said. “But like all development, some people want it and some don’t and it can be quite an emotional time.

“But it’s the only way forward to see buildings like these consolidated and renewed. A lot of them have fire rating issues and concrete cancer and will need a lot of money to bring them up to speed, but some people still want to stay, as their home is their castle. Ted is a responsible citizen and wants to look after people’s best interests but it has been getting heated, no doubt about it.”

Strata lawyer Amanda Farmer says she is seeing a lot of activity from developers who see their involvement as the last chance for many buildings, which tends to scare owners. They’ll often commission reports on the state of the building to expose its problems.

“It’s never straightforward. I know of strata owners who are being pressured by developers to sign sales contracts, against the threat of a lesser sale price should only just over 75 per cent approval be achieved and the formal process therefore need to be followed which is expensive and takes years,” Farmer said.

“Developers are often willing to pay more for a quick sale and aren’t afraid to tell owners what they stand to lose if they don’t get on board.”

Executive officer Karen Stiles of the apartment-owners’ peak body, the OCN, said, “If I lived in an older building with harbour views I’d be worried.”