Chandler lauds iCIRT, names defects blackspots

NSW Building Commissioner David Chandler has named nine areas in NSW where there has been a history of defective apartment block developments, and he strongly advises potential apartment purchasers, there and elsewhere, to seek out developers with iCIRT ratings, while avoiding “pop-up boutique” operators with no track records.

Mr Chandler, now into the last few weeks of his tenure as Commisioner, has been out and about promoting the benefits of the state’s iCIRT developer star-ratings system and pointing up some unexpected benefits.

Visiting the Urban developments’ Waterfront project in Gosford, he explained that while the original developer had gone into receivership, the fact that the scheme had an iCIRT star rating and an 10-year insurance warranty made it made it very easy for a new player to come in and take over.

“If anyone doubted the trustworthy developer landscape in NSW was on a positive long term trajectory then they would be miss-reading the tea leaves,” Mr Chandler writes in his Linkedin post this week.

“The markers now point to many players jumping off the past race to the bottom and wanting their brands back,” he added. “Anecdotal data suggests that, as of the 1st of July 2024, 477 developers and builders had engaged Equifax to provide them an iCIRT rating, with 271 having achieved a gold star rating.

“Advice from a number of large players who were slow to get on board is that they have commenced and or will soon have a positive rating. And there are now 55 issued LDI 10-year warranty insurance policies with 193 projects currently being quoted. For those who have yet to start the trustworthy journey the implications are becoming confronting.”

Mr Chandler says the benefits are farther reaching than merely reassuring consumers that their financial investments are well-placed. For instance lenders are taking iCIRT ratings into account, potential development partners (including government agencies) are asking for these credentials.  Even sales people are less keen to risk saying potential commissions leak to sales people who are prioritising iCIRT rated developers, he writes.

“A growing number of design professionals, contractors and certifiers are preferring to only work with iCIRT rated developers,” Mr Chandler writes. “Why wouldn’t they. In the past risky developers screwed them and compromised their prospects of doing a proper job. Many are still bearing heavy litigation and professional indemnity expenses for compromised work.”

And there is a benefit for long-term apartment owners, he write. “These apartment choices should increase in value at a better rate than those that have poor credentials. And, they can be expected to avoid the loss in value of apartments with legacy defects that may come from less trustworthy developers.”

Mr Chandler has named a number of previous defect “hot spots” where potential purchasers should seek out iCIRT rated alternatives.

“Sydney’s Eastern Suburbs, the Northern Beaches, The Shire, and the Inner West have frequently called out risky developers,” he says. “In the regions Illawarra, South Coast,  Central Coast, Mid North Coast, and Tweed are worth watching.”

He also advised caution when dealing with “pop-up” boutique developers. “Consumers are now in the box seat,” he said.

You can read the Building Commissioner’s Linkedin post in full here, and see an edited version of his video below.