Leaky apartment block - round two: Taxpayers could be hit with half of $18m bill

Scaffolding covering Summerfield Villas apartments in Grey Lynn. Photo / Martin Sykes

Owners of a huge apartment complex in Auckland are about to endure their second round of building repairs, costing an estimated $18 million - and taxpayers and ratepayers could be up for half that bill.

Alex Burrell of Burrell Demolition said he had tendered to rip the cladding from building in Grey Lynn, which was last repaired by now-defunct builder Mainzeal and developer David Gaze last decade.

The Summerfield Villas complex in Grey Lynn. Photo / supplied

The owners of the 93-unit Summerfield Villas on the corner of Richmond Rd and Sackville St want the Government/Auckland Council Financial Assistance Package which could result in them getting about $9 million, although each apartment owner will still have to pay about $100,000 to fund an $18 million repair.

The owners have endured more than a decade of weather-tightness problems and are understood to be angry and upset about the situation.

Mr Burrell said he only found out about the building's failure when the tender documents were issued and he is angry that such a significant complex, developed on the ex-Sleepyhead Bed factory site, had failed so spectacularly.

"When it's big and awkward, it annoys me," he said, questioning its design and construction techniques.

Roger Levie of the Homeowners & Buyers Association confirmed tenders for the work were in progress.

Reuben Jackson, body corporate chairman, said repair plans were in hand. "Summerfield Villas will be reclad some time in the near future. We have received tenders for the work and we are currently in negotiation with those tenders, and owners will very soon select a tender to progress with the work. Given this is a commercially sensitive time in the negotiation process, we don't feel it is prudent to discuss the issue in the media, but we would be happy to as soon as a tender has been accepted," Mr Jackson said.

Mr Gaze said this week he had no ongoing involvement. "I have been working overseas from 2002 to 2011 so I am not aware of this tender to refurbish the apartments that were built back in 1999/2000," he said, referring to the expense he and Mainzeal had incurred previously.

"We obtained at least three Code Compliance Certificates to fix up concerns back in the early 2000's. This is now circa 15 years ago," Mr Gaze said. A party involved in the repair work said water had been coming into the apartments from faulty parapets, complicated dormer-style windows and due to the three-level complex's roof design.

The complex is to be reroofed, reclad and its kiln-dried timber framing treated in-situ to stop the fungus, mould and rot. A new linear-style fibre cement cladding by James Hardie is to replace the existing monolithic cladding where joins and junctions allowed water to penetrate the untreated timber framing.

The body corporate has considered litigation, but ditched that in favour of the package which allows leaky building victims to apply for up to 50 per cent of repair costs if they agree not to sue council and others.

The terms of the payout cannot be settled until tenders are official.

The body corporate has just been to the High Court at Auckland to get legal approval for its scheme of arrangement to undertake the repairs.

In 2004, The Herald reported satisfaction with the first repairs. D. Kelly wrote in November 2002 of "the honourable and, yes, compassionate actions of our Summerfield Villas developer, David Gaze, and Mainzeal Construction who are remedying our problem at their expense ... setting a shining example to other developers, builders and construction companies."

Biggest leaker bills

• Nautilus apartments, Orewa: owners won $25.07m
• Spencer On Byron, Takapuna: owners won $20.5m
• Summerfield Villas, Grey Lynn: will cost about $18m to fix.