Private property developer Mark Stockwell said the group's Riverpoint apartments at West End had water in the basement. The floodwaters did not reach the residential floors. "The water has now all been pumped out and there was some damage to the electricals, which is now being fixed."
Wednesday, January 19, 2011
Flood Building Update From Readers
Saturday, December 18, 2010
Pets in 212 Margaret
As reported in a prior post, there was a decision relating to pets in 212 Margaret apartment building in Brisbane. Here is the Decision.
It is interesting to read the submissions of some apartment owners who tried to prevent pets in other people's apartments. Maybe we should have a rule that says no children and TVs in their apartments. I have lived in expensive apartments in other cities where most people have pets. Some people in Brisbane are quite backwards! It is also strange that people have argued that there should be no pets because the building is being used (illegally) as a hotel!
"Jo Anast, owner of Lot 81, says she would like the possibility of having pets in the scheme and is in favour of the application.
Shane Doepel and Shaun Stevens, owners of Lot 31, say that the building is not suitable for housing pets in any circumstances, being a high-density CBD residential development. Most of the units are let as part of a very busy hotel. The scheme only has “modest common areas.” Owners who are buying into the scheme do so knowing that there is a “no pets” policy which in their case influenced their decision to buy.
Frank and Marilyn Moes, owners of Lot 61 (unit 1501) say that they purchased because of the “no pets” policy. They do not believe that living in the city is an appropriate environment for animals such as dogs and cats. There are no immediate close areas where a dog can be exercised, and dogs and cats should not be in all day but have a yard to play in and access to fresh air. Mr Moes also has an allergy to animal hair.
Rachel Findlay, owner of Lot 23 (unit 805) supports the application, believing it unreasonable to ban all pets. She has lived in CBD buildings which allow pets, and the animals have not been disruptive. In “Aurora” at 420 Queen Street, it is one of the reasons why the units are highly sought after. The body corporate should allow pets within reason such as pets below a certain weight/size.
Maria Barnett and Paul Schaller, owners of Lot 121 (unit 2701), say that before purchase they checked that pets were not allowed. He has severe allergies to dog and cat hair and would not be able to use the lifts or foyer if there was animal hair in the carpets. They say that in their experience with tenants, fish tanks can cause damage to carpets, clog drains and leave stains. The building is used as a hotel so a blanket ban on pets in not unreasonable. No matter how well- behaved pets are, they would cause extra work for the management and result in blocked-in balconies which would change the exterior of the building.
Verne Baistow, owner of Lot 95 (unit 2203) says that he supports a “no pets policy.” The units are too small to provide adequate room for an animal, and the units are used for hotel accommodation. “No animals are allowed in hotels” so there should not be any animals in the scheme building either. He is also concerned about health issues and noise.
Colin Yeoman and Louisa Farthing, owners of Lot 33 (room 1005) say that the registered by-law should remain as it is, since the building is inappropriate for the housing of pets.
Christine Torbey, owner of Unit 1801, says that the building is an inappropriate residence for pets, especially dogs and cats. Animals are unpredictable and it is not possible for an owner to control entirely an animal’s behaviour. She says that this is a “standard rule in city apartment blocks generally.”
Gregory Firth, owner of Unit 603 says that the scheme should not entertain pets at all."
Thursday, November 18, 2010
Felix Auction
Sunday, November 7, 2010
Apartments or Hotels
"... Mr Punch alleged in his statement of claim that the original disclosure statement received from Niecon subsidiary South Sky Investments revealed that he was buying 'a lot in a residential building'.
If he were buying today, that disclosure statement would have to declare it was an 'apartment in a hotel', he said in the claim. ..."
From GoldCoast.com.au
This is a warning to developers who build apartment buildings (such as Aurora) and then sell the management rights to Oaks to operate a residential building as a hotel.
Monday, May 3, 2010
Oaks Fined for Car Park Leasing
Brisbane City Council has fined The Oaks Group for unlawfully leasing residential carparks to commuters after an investigation which City News understands lasted several months.
According to its website, The Oaks Group arranges short-term bookings for eight unit blocks in the CBD. Car parking spaces meant for long-term residents have instead been leased to inner-city workers for up to $5000 a year. Councillor David Hinchliffe (Central) welcomed the penalty and said he believed the practice was widespread and was “potentially just the tip of the iceberg”.
He said he believed senior managers in both the private and public sectors had paid for carparks made available in contravention of the Council’s planning approvals. “If you’re operating a commercial carpark, then you need to be zoned and approved for a commercial carpark,” he said. “One carparking space can generate easily around $5000 a year in revenue for the company, 200 car spaces are worth $1 million in revenue.
“My understanding is that apartments are being rented out without carparks so that the company can lease out the carparks separately to commuters, encouraging more people to drive to work and park and adding to congestion.”
Brisbane City Council failed to answer several questions about the practice before City News’ deadline. When contacted for comment, an Oaks spokeswoman replied: “We are not at liberty to respond to that matter.”
Saturday, March 6, 2010
Lack of Privacy
Thursday, September 3, 2009
Questions
- What will happen to the inner city Brisbane apartment market if foreign students stop coming to Brisbane?
- When interest rates rise, will Brisbane apartment prices fall?
- Will Meriton build a building in Brisbane that is lesser quality than Devine? Is that possible?
- When will Felix have its river views blocked by development?
- Will rental returns to owners in Oaks buildings decrease this year?
- Will apartment prices in Brisbane continue to fall into 2010?
- When first home owners stop buying, will sellers who have not sold become desperate?
- Are the only investors buying at present the vultures and bottom-feeders?
Monday, August 31, 2009
Oaks 08/09 Results
Oaks Hotels & Resorts Ltd net profit was down 33.3% to $9.8 million in the year to June 30, 2009, on revenue up 11.5% to $120.9 million.
- 38 properties under management
- 4,788 serviced rooms under management (12% increase over last FY)
- occupancy rate down 2.11% to 84.38 for CBD properties
- average room rate $151 for CBD properties
- new central reservations team -- I wonder what owners are being charged for this?
Saturday, August 1, 2009
Oaks "Hotels"
Example Reviews:
Aurora
212 Margaret
Festival Towers
Casino Towers
Charlotte Towers
Felix
Lexicon
River City
Similar issues for M on Mary.
Monday, June 8, 2009
Comment from a Reader re Oaks and Aurora
A reader kindly sent me this note, in response to a prior posting:
I am concerned about trends in the industry, whereby the Oaks are flouting the law by operating a hotel in a Classification 2 building. The Oaks has more money than any Owner’s Corporation, and they know as long as Brisbane City Council and the State Government of Queensland turn a blind eye to them, they can out spend any Body Corporate in our legal system.
I went to a recent auction run by LJ Hooker in Aurora, and the agent was late because he could not get up and down the lift (the Oaks closes two of their five lifts down between 10:00 am and 2:00 pm). When we finally got into the building, there were hotel guests unpacking and repacking their bags in the lobby. The lifts were crowded with students, overnight stays ....
It is no surprise to me that the auction of a $1.1 Million plus unit did not attract any bids. The vendor made a bid of $725,000, and about 12 people stood around, hands in pockets. After the auctioneer consulted with the owner and got instruction, the vendor’s bid was lifted to $770,000 and again no bids. I don’t know if this property ever sold. It was passed in on the day.
The presence of any hotel group, in my opinion devalues the units and lowers the general feel and look of a residential building and diminishes the lifestyle of resident owners. Other factors to consider are:
Don’t Owners get Higher Rents for Hotel Guests/Short Term?
Your committee and the Manager might try to tell investors that they will earn more money. Yes, their rents might be a bit higher, but that is only part of the story. With higher rents, come higher risks, such as risk of vacancy, more tenant churn, more wear and tear on common property and much higher Management Fees.
The Oaks tend to return to investors about 48% to 50% of the total rent collected, when the high management fees, charge-on costs and miscellaneous costs are all taken into account. I believe this to be in line with any other hotel group’s figures. Perhaps someone from the Oaks could confirm these figures.
Rental Pools – How do they work?As an investor in a ‘hotel’, your unit is most likely going to go in a ‘rental pool’. It is impossible to tell how often your unit is let out, as the agreement entitles you only to a portion of the total pooled funds. That means that if your unit is a superior one, and is let fully, you will be subsidizing other units which may be inferior and not let out fully.
There are lots of hidden costs to any investor from their hotel manager. One horror story involves an owner who double checked his statements, and each month they would be buying ashtray, glasses, microwave, mattress protector, etc. The Managers did not need to give any proof that the item was damaged or broken, they simply went ahead and bought these items, added a hefty commission and merrily went about spending the owners’ money, despite instruction from the owner that she would replace any items in the unit herself. Another horror story involves a man who went straight to the manager’s desk and asked if there were any vacancies. Yes, the manager said, just go to that phone over there and ring this number. The unassuming man went over and used the phone, the manager answered and earned 30% commission (out of the owner’s pocket) for the exercise. There are more stories where these come from. This is just scratching the surface.
Fire Regulations?As indicated already, regulations appear to mean nothing to the Oaks. They run a hotel in Aurora, which is a Classification 2 Building, with inferior fire safety protection for the occupants.
How do Hotel Groups and bad Managers devalue units?
There are many drawbacks to a hotel group taking control of a residential building. Investors need to be aware that although it may seem that rents increase, their net income will drop. Aurora has shown us that units will be significantly devalued by the presence of the Oaks, or any other hotel group. Colin Archer was recently quoted at the Unit Owner’s Conference as saying that “if owners want to buy into a hotel, they should buy a hotel. If they don’t wish to live in a hotel, don’t buy in a residential building managed by any hotel group”, because he well knows the massive and negative impact a hotel operation has on the permanent, resident owners. One owner stood up and asked Colin Archer what owners in Aurora could do to protect themselves, because the Management Rights were sold to a Hotel Group to the detriment of owners. He started squirming in his seat. He is a director of the Oaks, and he was sitting on the panel with Michael Teys who sold him the Management Rights. They seemed to think it was quite a funny joke. After some good natured squirming, Colin Archer said that owners need to ensure a bylaw is in place with a three month limit on leases. To his credit (I think he wants to retain his right to practice law), Michael Teys stood up and corrected Colin Archer. He told the crowd that such a bylaw would offer absolutely no protection to owners.
Take also into account that backpackers, suitcases and crowds in the lobby negatively impact on any residential home. In Aurora, I believe that two of the five lifts are closed off to residents because of the cleaners activity between 10:00 am and 2:00 pm. Cleaners block not only the lifts, but the corridors of all of those unfortunate souls who live on the ‘hotel’ level. There is more wear and tear on common property, and the end result is that all owners pay a price – investors pay the financial price and resident owners pay the price of a diminished lifestyle.
Is there any upside to a Hotel?No, not that I can see. Hotel Management Rights are there for the sole benefit of the managers, and to the detriment of both investor owners and resident owners. If someone can convince me that the Oaks have increased the value of the units in Aurora, or enhanced the lifestyle of all occupants, I will happily listen. Until I hear a good case for owners, I won’t be changing my mind anytime soon.
Sunday, June 7, 2009
Oaks Sells Out - To Brother!
At the recent Oaks AGM, there were reports that angry Aurora owners questioned the CEO of Oaks, and that he could not provide sensible answers.
See ASX Release and follow-up.
Friday, February 20, 2009
Oaks Ok
"Mr Pointon said occupancy rates in Oaks's regional properties during January were 80-90 per cent and while its Sydney properties recorded 90 per cent, Melbourne 75 per cent, Adelaide 85 per cent, Brisbane 70 per cent and Auckland 77 per cent."
Source: The AustralianWednesday, January 7, 2009
River City Apartments Fire
Queensland fire fighters say overhead sprinklers saved an inner-Brisbane apartment block from serious damage. More than 30 residents were evacuated from the River City apartment block around midday, after a fire started in a couch on a balcony of the 15th floor of the building.
Fire fighter Dave Sutch says overhead sprinklers helped contain the fire, but also caused some damage. "We have severe water damage on the 15th floor and it's leaking through to the 14th floor," he said. Residents were not allowed back into their apartments for more than two hours while fire crews secured the building.
ABC NewsThis building is being run by Oaks as a hotel, but I suspect that it does not have hotel standard fire safety standards.
Sunday, November 9, 2008
Building Classifications
http://www.dip.qld.gov.au/resources/newsletter/newsflash-327-guideline.pdf
Wednesday, October 15, 2008
River City and Oaks - Again!
I saw this on a bulletin board:
"Remember the controversy of kicking all those tenants out of Charlotte Towers??? Well... guess what... its happening again, but with River City.
The Oaks has send letters to all of their tenants telling them that they must leave because their apartments will be turned into short term accom... BUT... and thats a big but because the Oaks as NOT INFORMED any of the owners that they are kicking out tenants so that they can convince owners that they could get more money from short term accommodation."
See this post.
I would be careful and do a complete due diligence before buying in an apartment in a building managed by Oaks.Tuesday, July 15, 2008
Wednesday, June 18, 2008
Construction Near Oaks Apartments in Brisbane
If you are buying or renting or doing a short stay in an Oaks apartment, make sure there is no construction nearby. This morning, walking down Albert Street, I past 3 construction sites, all next to apartments. It was before 8am, and there were jackhammers that I could hear more than a block away from Charlotte Towers.
Oaks Charlotte Towers
Oaks 212 Margaret Street
Oaks River City
Friday, June 13, 2008
Oaks and Aurora
This is what the Supreme Court of Queensland wrote in a judgment concerning management rights for Aurora. It appears that the original developer did not want the building managed by Oaks as that would hurt sales. Aurora is now managed by Oaks.
"Oaks is in the business of providing accommodation for travellers, holiday makers and semi-itinerant urban workers. The news that the plaintiff, the proposed letting agent for the Aurora complex, would become an Oaks subsidiary caused considerable anxiety in the minds of the defendants’ directors. Rightly or wrongly they associated Oaks with a distinctly plain, perhaps plebeian, approach to the provision of accommodation. To maximise profit from its development the first defendant asked high prices for Aurora’s residential lots and promoted the development as one suitable for those who enjoy wealth and its display. They thought that Oaks’ reputation and its method of operation would be inimical to achieving that result.
The first defendant had two concerns. The first was Oaks’ involvement as the letting agent. The second was the operation of ‘short term accommodation, serviced apartments or hotel style accommodation typically used as holiday and nightly business or corporate accommodation ...’ from the tower. Mr Morris anticipated that about one third of the buyers of residential lots would live in the units but the balance, about 320 owners, would let their apartments to tenants. Mr Morris believed that letting a large number of units on a short term basis would be inimical to the first defendant’s proposed marketing strategy. As he said:
Both Mr Potts and Mr Morris were disposed to deny that Oaks’ involvement in the letting of units in Aurora was a particular concern. They maintained that it was the prospect of frequent numerous changes of tenants in the building which would reduce its appeal to buyers, regardless of the identity of the letting agent. If it matters I express my satisfaction that Messrs Potts and Morris were particularly alarmed at the thought that Oaks would be the letting agent. Indications of this fear appear in the correspondence, and I thought their denials unconvincing.‘... the operation of a short term accommodation business from the Aurora Tower, particularly of the kind which appears from the Oaks prospectus would be conducted by Oaks, would be completely inconsistent with the way the development had been promoted, advertised and marketed and inconsistent with the type of development that buyers were told it would be.’
...
The plaintiff’s solicitors’ file note records the discussion:
It should perhaps be noted briefly that the possibility of the plaintiff operating a hotel from Aurora Tower was so slight as to be disregarded by any sensible person. The building is not suitable for use as a hotel. It does not have sufficient lifts, storage space, staff quarters or vehicular access to function as a hotel. This was accepted by all parties. The first defendant cannot sensibly have thought that the plaintiff, or Oaks, would conduct a hotel from the tower.‘Having sold the units to owners on the basis of it being a high quality residential complex ... owners would have some claim against the developer and possibly some way of getting out of the contracts if it became branded as an Oaks hotel/resort. It was acknowledged that the sale of contract contemplated that ... owners could let out units for short term lettings but it was never promoted as a short term letting complex, hotel or resort.’
...
It is possible to let a substantial number of the units as serviced apartments but to do so would require some physical alteration to the building. There would need to be a large storage room for bed linen and towels and probably facilities for the cleaning staff. These alterations could only occur with the approval of the body corporate. The consequence is that the letting agent could only let a large number of apartments as serviced ones with the approval of the body corporate which would have to effect the alterations on its common property. The first defendant could hardly complain about lots let as serviced apartments if the parties to the letting agreement agreed on that course and, if necessary, varied the letting agreement to effect it."
http://www.austlii.edu.au/au/cases/qld/QSC/2007/264.html
But Aurora is now a hotel: Brisbane Times
Wednesday, April 23, 2008
Margaret Street Developments
Wednesday, March 19, 2008
Would you live in Charlotte Towers?
I visited Charlotte Towers recently. It was built and sold by Devine as an apartment building, and sold as "residential apartments". However, it is now an Oaks Hotel. There are still some people living here on a full time basis. But it is not nice. Four things that I saw on my visit:
- room service plates and trays left in the hall
- cleaners with trolleys blocking halls and elevators
- a hotel guest who was very frustrated, who had a bad check in experience, and could not find her way to her "room" - she took her frustrations out on me
- the driveway to the car park blocked with people trying to check in -- there were four cars trying to get in and two cars trying to get out -- but it was blocked by a car of guests checking in.
An agent said that it was better now, as the facilities got less use -- before Oaks, there were many students in the building, often illegally overcrowding apartments. Oaks, he said, is now focusing on short stays for executives. The agent said that Oaks had over 90% occupancy during the week.
Online, I could reserve a one bedroom apartment for $150 a night.