Understanding Combustible Cladding Defects and Risks for Residential Strata Property
Date published: 8 January 2024, updated 9 December 2024
As cities across Australia continue to grow, the use of materials like aluminium composite panels (ACPs) in construction of apartment buildings has been widespread. APM is a term used to describe a flat panel that consists of a core (often polyethylene) bonded between two aluminium metal sheets that are commonly used as the cladding in many medium to high-rise buildings.
ACPs has been in use in Australia since the 1970’s, popular for its versatility, lightweight and low-cost price. However, it was not until the Lacrosse building fire in Melbourne in 2014 and the Grenfell Tower fire in London in 2017 that the widespread use of the combustible cladding (particularly those deemed to have highly flammable cores) came under intense and justifiable scrutiny.
These incidents prompted increased awareness of the risks associated with combustible cladding, leading to investigations, reviews of building regulations, and efforts to address the issue across the country. Given the larges scale use and size of the buildings, this was never going to be an immediate fix, however, regulatory changes across Australia have been made to minimise the potential of new buildings having non-compliant materials and furthermore, any buildings that already have it be assessed to determine if any future action is required.
While the issue of combustible cladding is present across Australia, Victoria particularly faced media attention after the high-profile incidents of the Lacrosse building fire as well as Neo200.
The Victorian Government’s $600 million cladding rectification program ensures Victorians are safer by reducing the risk associated with combustible cladding on residential apartment buildings.
In 2019 the Victorian Government established Cladding Safety Victoria (CSV) to collaborate with owners and owners’ corporations to help them rectify non-compliant or non-conforming external wall cladding products on buildings. CSV provide support, guidance, and connections to appropriately registered and qualified practitioners. This included conducting audits of buildings and providing financial assistance for rectification works.
The risks and defects associated with cladding
One of the most significant risks associated with combustible cladding is the rapid spread of fire across the building's exterior. This can lead to life-threatening situations and extensive property damage. Even the smallest of fire outbreak in one apartment can escalate quickly if the building has combustible cladding.
Buildings with combustible cladding may face challenges in meeting regulatory compliance standards, but it is crucial that property owners ensure that all safety and compliance standards are met. If this is not done in due course, the property owners will most likely face significant legal and financial repercussions.
It is vital that property owners work with strata managers, brokers and insurers, together with Statutory Bodies, Cladding taskforces or other suitably qualified experts, to assess what needs to be done to tackle any critical issues associated with combustible cladding.
Understanding the defects associated with combustible cladding is crucial for proactive risk management. Some common defects CHU has encountered with cladding include:
Lack of Fire Resistance/Use of products deemed unsafe: Non compliant combustible cladding materials that are deemed unsafe for use due to the lack the necessary fire-resistant properties, making buildings susceptible to rapid fire spread.
Poor Installation Practices: Improper installation can compromise the effectiveness of cladding materials, leading to gaps and vulnerabilities that increase the risk of fire propagation, as well as other building defects due to the installation method deployed (such as water penetration)
A collaborative approach to remediation
Mitigating the risks associated with combustible cladding, and complying with regulatory standards will take a multifaceted approach that involves collaboration among strata property owners, regulatory bodies, and industry professionals including strata insurance brokers, strata managers and strata insurance providers.
Risk Assessments:
An important first step was to identify the buildings which have combustible cladding. This included on-site inspections and fire testing of materials. Each state government had put in place a deadline for buildings to self-report the presence of combustible cladding. Once identified, risks were categorised based on the severity of the combustible cladding issue. Factors such as the type of cladding, its location, and the building's use can contribute to the assessment. Buildings with higher risks should be prioritised for remediation efforts. This ensures that resources are allocated efficiently, addressing the most critical issues first.
Cladding Replacement:
Given the large-scale costs associated with cladding replacement, financial planning and potential financial assistance programs were established by some state governments to assist strata property owners in addressing this costly, but urgent remediation.
Ensuring that all remediation efforts comply with existing building codes and regulations is imperative. This may involve close collaboration with local building authorities to stay informed about any updates or changes in regulations.
Maintaining thorough documentation of the remediation process is essential for regulatory compliance. This documentation may be required for inspections, audits, or other regulatory purposes. Compliance with regulations goes hand-in-hand with ensuring the safety of occupants.
The webinar hosted by CHU and Cladding Safety Victoria underscores the importance of collaboration in addressing combustible cladding issues. By bringing together industry experts, regulatory bodies, and stakeholders, a collective effort can be made to raise awareness, share insights, and develop effective solutions.
Properties with known combustible cladding issues may experience a decline in market value, affecting both homeowners and investors. But the more pressing issue is the safety of all the residents within these buildings, and this is driving the urgency of having cladding identified and assessed by suitably qualified experts to determine what course of action is necessary.
Government regulatory bodies such as Cladding Safety Victoria, are working collaboratively with insurers, strata managers and strata property owners to create a safer and more resilient built environment.
Legal Responsibilities of strata owners
Strata owners have a legal obligation to ensure compliance and safety regarding combustible cladding. Here are some of the key responsibilities of owners corporations:
1. Get a building assessment
Having your building assessed will uncover the type of cladding material used and if it meets appropriate building standards. It will also identify any potential risks and guide you on what action is required, which could include no further action, a fire engineering solution or replacement of cladding.
2. Fire safety measures
It’s crucial to have adequate fire safety measures in place. Strata owners should ensure that the property is well-equipped with smoke alarms, fire extinguishers, and evacuation routes. All fire evacuation routes and protocols should be displayed visibly in all accessible areas of the strata property. Regular fire checks and drills should also be implemented to ensure that residents are familiar with emergency procedures.
3. Keep copies of inspection and certification documents
You need to retain copies of inspection and certification documents for compliance checks. Access to these documents ensures compliance and prepares you for any necessary audits or inspections or to provide to third parties (i.e. insurers) when requested.
Remediation Costs
Due to the significant costs involved in cladding replacement, some state governments have introduced financial planning and assistance programs to help strata property owners manage this critical yet expensive remediation process.
Please contact the appropriate statutory body in your state or territory to determine what assistance may be available to your owners corporation, which may include funding for buildings deemed high risk or access to low interest loan facilities.
Compliance with Building Codes and Regulations: a collaborative effort
Ensuring all remediation efforts comply with current building codes and regulations is essential. This may involve ongoing collaboration with local building authorities to remain informed about any updates or changes.
Thorough documentation of the remediation process is also crucial for regulatory compliance. These records may be needed for inspections, audits, or other regulatory purposes, and they play a key role in ensuring occupant safety.
The webinar hosted by CHU and Cladding Safety Victoria highlights the importance of collaboration in addressing combustible cladding challenges. By uniting industry experts, regulatory bodies, and stakeholders, we can collectively raise awareness, share insights, and develop effective and safe solutions.
The impact of cladding defects on property value and resident safety
Properties with known combustible cladding issues may experience a decline in market value, affecting both homeowners and investors.
However, the primary concern remains the safety of residents, driving the urgent need for qualified assessments of cladding to determine what course of action is needed. Compliance with regulations directly supports the safety of occupants. This includes addressing fire hazards associated with combustible cladding and structural issues that can significantly endanger residents and the property itself.
Government regulatory bodies, such as Cladding Safety Victoria, are actively working with insurers, strata managers, and property owners to foster a safer and more resilient built environment. This collaboration and commitment to cladding safety help ensure that residential strata properties remain conducive to a safe living environment and a valuable investment for its residents and owners.
Additional reference material:
https://www.vic.gov.au/cladding-safety
https://www.planning.nsw.gov.au/policy-and-legislation/buildings/combustible-cladding
