Uniting Financial Services (UFS) recently completed a full replacement of the combustible cladding on a commercial office building it owns in Brisbane. UFS understands from construction industry sources that this is the first commercial building in Brisbane, and possibly the first in Australia, to have done so.
“For us this was first and foremost an ethical issue,” said
Warren Bird, UFS’ Executive Director.
“When we found out that the office tower we owned was clad in the Aluminium Composite Panel (ACP) that had made the Grenfell Towers fire in London so devastating we moved quickly to find out what could be done and take appropriate action to make the building safe. I’m really proud of my colleagues and the Board of UFS who had no hesitation to decide that we needed to do the right thing.”
UFS did not realise at the time that they were one of the few commercial building owners in Australia that had made that decision. Others have taken steps to reduce the risk to their buildings and achieve fire safety compliance through more partial remediation. Although a cheaper option than full replacement of the panels, UFS decided to incur the additional expense.
Is this an example of ethical investment decisions being costly and reducing investment returns?
“Not at all,” Mr Bird said. “For one thing, other buildings that have ACP are now finding insurance a problem, which is impairing their investment performance. I’ve heard of sales to new investors falling over because the prospective purchaser can’t get insurance. More importantly, though, we combined the ACP replacement with other refurbishment works to our building, which have enhanced its value significantly. For instance, the two large cooling towers for the air conditioning system needed replacing, so our construction partners (ATG Projects) combined the work to do that with the work to strip the exterior of the building down and replace the cladding. We now have a fully compliant building, that’s been refurbished and repositioned in the Brisbane market and is attracting increased tenant interest. It’s a great example of ethics and economics working together for a very pleasing outcome. I must add that we couldn’t have done this without Brisbane City Council being very helpful in providing permits to enable the work to be done.”
Works have also been done to improve the energy efficiency of the building. According to Bird, “this is another example of ethics and economics working in the same direction. The building’s carbon footprint is reduced, which also makes it cheaper to operate. This is a key element of our property strategy. It’s win-win.”
The building is at 119 Charlotte Street, Brisbane. As well as the new building façade, other work done has been to create a new, modern foyer and designated office lobby; new end-of-trip facilities and bike storage; an upgraded retail outlet offering on the ground floor; refurbishment of all available floors; and other building services upgrades.
Realmont Property Partners manages the building, with Cadence Australia repsonsible for project management and ATG Projects for construction work.
Uniting Financial Services is the trading name of the Treasury and Investment Services arm of the Uniting Church’s NSW & ACT Synod.