Development Industry Ill-Prepared For ‘Building Quality’ Crisis_hugo halliday pr and marketing | | |

Recent issues surrounding the design and construction of Sydney’s Opal Tower have highlighted the urgent need for the development and building industry to have stakeholder and crisis communication management plans and training in place.

In my experience the industry is ill-prepared to deal with a major crisis or issues related to building quality – particularly when numerous stakeholders are affected, and the media and politicians get involved.

There is a widespread perception that new apartment towers may not be built properly given the volume and pace of construction over the past few years, with fears about cost-cutting and use of inferior materials.

The Age newspaper (December 18, 2016) reported ‘Victoria is facing a crisis of faulty, dangerous and leaking buildings that experts warn is comparable in scale to the historical scourge of asbestos’. It added that ‘shoddy materials and poor workmanship mean many homes and apartments in Victoria are likely to be outlived by their owners’.

According to The Age, structural failures had already emerged in residential buildings just a few years old, while ‘leaky building syndrome’ had caused severe mould infestations making many homes uninhabitable.

In Sydney, ABC News (2017) reported that no-one knew for sure how many apartments were defective or leaky, but some figures indicated ‘most new buildings had some kind of problem’.

In an interview with Bill Randolph, the director of the City Futures Research Centre at the University of New South Wales, he revealed that ‘nobody keeps records of this stuff. Quite a lot of the defects don’t get anywhere, they don’t get to the court, or owners just pay up and get on with it because they can’t be bothered to cover the cost of taking a builder to court’.

However, the ABC revealed that ‘a survey of strata owners conducted by the Research Centre in 2010 found that a startling 85 per cent of respondents in buildings built since 2000 said their buildings were defective’.

Better documented are building quality issues causing major problems overseas in Canada with its leaky condo crisis costing an estimated $4Billion in remediation measures while in New Zealand the estimate is even higher at about $22Billion.

Senior Lawyer at Lovegrove & Cotton, Kim Lovegrove wrote in a company article in September 2017 that the signs for future problems were already present in Sydney, Melbourne and Canberra, and needed to be proactively and holistically addressed. He said: ‘A failure to do this will generate a very adverse community dividend both in terms of the impact upon the public purse and the happiness barometer’.

There is also some evidence that structural engineers sometimes get it wrong. A celebrated case was the Citicorp Center Tower in New York in the mid-90s when high-rise engineer William LeMessurier became aware of a major design flaw and set about rectifying it to avert a possible disaster – more than 10 years after the tower had been built.

Whatever the cause of building quality issues for Sydney’s Opal Tower, it is clear the development industry will increasingly be under the spotlight and must be ready with management strategies in place to fairly and effectively communicate with affected parties, and the broader group of stakeholders.

Everyone wants immediate answers and the longer there is a vacuum in the provision of information, the more difficult it will be to ‘cut-through’ the clutter of claims and opinions. More time can be spent dealing with wrong information than pro-actively addressing the actual crisis.

Developers and builders could suffer permanent reputational damage if they don’t have processes already in place such as trained spokespersons, holding statements and contingency plans for stakeholder communication and actions.

It is impossible to put all this together at short-notice. If you’re not ready, you’re putting your entire company or business at substantial risk. Employing a PR agency may help, but few consultants will have the necessary understanding about such a complex industry and its public, political, government and other stakeholders to quickly produce an effective strategy.

I have been a media and communications director in ‘crisis-rich’ organisations including for the Army both here and overseas, the NSW Department of Corrective Services and I worked as consultant with major corporate clients to integrate crisis and issues management plans and training into their operations. Amazingly, the development and building industry lags behind these government and corporate entities in this essential management area despite the clear risks.

The Opal Tower is just one example of what can happen if something goes wrong, but the building and development industry is likely to face many more such issues given the volume and recent sustained high growth period in high-rise building construction.

A small investment in getting prepared for crisis communication will provide a big return, and possibly even save your enterprise, should it be required.


Bill Pickering Hugo Halliday Bill Pickering is a crisis communication expert. His work includes leading the response to Townsville’s 1996 Black Hawk tragedy and the death of 18 personnel. He provided the crisis response to a major prison riot at Goulburn Goal in 2002 that seriously injured Corrections officers. In 2004/5/6, he managed issues communication for the smash repair industry leading to legislation change. In 2008 – 2012 he consulted to a national insurance corporation to establish crisis response and government relations management processes. In 2018, he guided a national aged care client with industrial negotiations. From 2016 to current, he has co-ordinated media stakeholder communication for developer, Showground Corporation.