Climate change is happening whether we like it or not, with Australia warming by around 1.44 degrees on average since national records began in 1910.
Rising temperatures will have a big impact on strata buildings, which will require owners to make expensive alterations to their buildings.
More on that later. First, though, let’s look at the climate situation in a bit more detail. A temperature rise of 1.44 degrees might not sound like a lot, but even that small lift has led to extreme conditions, such as the time when the Sydney suburb of Penrith was the hottest place on Earth. So it’s increasingly likely we’re facing a future where 40-degree-plus summers will be a lot more common.
And while the NSW government might be banning dark roofs on new homes in a bid to tackle those blistering summer temperatures, that’s not much help when you own a strata property that was built years ago. Because while your apartment building might need climate-proofing to help you cope with Australia’s warming climate, where’s the money supposed to come from?
Climate-proofing doesn’t come cheap
Many strata communities already find it challenging to raise funds for general repairs and maintenance. So when you add expensive sustainability upgrades, such as rainwater collection, intelligent windows, lighting and fire upgrades or improved solar and battery technology, into the mix, it’s likely to be even more of a struggle.
Then there are rising insurance premiums to consider. Why are premiums rising? Again, because of climate change, with hundreds of thousands of properties across the country at an increased risk of climate-related hazards, such as bushfires and storms, in the next 30 years.
The insurance bill from the 2019/2020 bushfires alone was $1.9 billion – sending premiums in some areas skyrocketing by more than 400%. And both the Reserve Bank of Australia and APRA, the insurance regulator, have flagged that climate change might put insurance coverage out of reach for many Australians.
Coastal buildings, in particular, are being damaged by extreme weather such as the June 2016 'superstorm' that battered eastern Australia. Residents in Sydney’s Collaroy Beach, one of the worst-hit areas from the 2016 storm, have still not managed to get a sea wall built to protect their homes.
The reason? Getting 10 homeowners to agree to each pay between $250,000 and $400,000 for the construction is a very difficult task – as anyone who has sat in a body corporate meeting will know.
Onwards and upwards
Fortunately, there’s a solution to the climate-proofing problem that doesn’t involve strata owners dipping into their pockets: airspace development.
This is when you take the unused roof space in a strata complex and use it to build additional apartments. Strata owners can either group together to take on the project themselves or sell the airspace to investors, generating up to $2 million in additional funds for the kitty.
This money can then be used to help climate-proof the building or be put towards other repairs and maintenance. Alternatively, the money could also be paid out to owners as profit to spend as they like.
Want to green your strata complex but lack funds? I can help you capitalise on your airspace. Call Warren Livesey on 0415 254 420 or email warren@buyairspace.com.au to get started.