WHAT HAPPENS WHEN A DEVELOPER OF REPUTE FALLS ON THE WRONG SIDE OF QUALITY?
WELL, IT GETS A LITTLE MESSY
*This article first appeared in the Real Spaces section of The Malay Mail newspaper on 07/10/2016
BY Prisca Teh
Premium brands are expected to spell quality and reliability. Inadvertently though, even big brands brush with blunders. Sometimes, these glitches prove their mettle.
As a case in point, Toyota and Samsung, despite their encounters with faulty brakes and batteries respectively, remain trusted brands because apologies were promptly issued, products were swiftly recalled and buyers were duly compensated.
Such a test of trust is what IOI Properties Group Bhd faces now. Having recently received awards such as “Top Ranked Developer of the Year” and “Top Ten Developer”, its reputation is now being questioned by a group of discontented buyers.
Complaints are rife on a public Facebook page, created by buyers of double-storey terraces at IOI’s Alpinia project. The project, developed under IOI’s subsidiary, Nice Frontier Sdn Bhd, is located within the developer’s successful Bandar Putra Kulai township in Iskandar Malaysia, Johor.
Sized from 2,418sq ft, units there were sold at attractive prices starting from RM499,410.
Among the major complaints is insufficient headroom under the staircase. Instead of the 2m minimum height set by Uniform Building By-laws (UBBL) – actual heights fluctuate between 1.83m and 1.7m in various units, it was claimed.
“How can we move the furniture? Through [the] balcony?” one buyer asked.
Secondly, as the roof has been designed into two divided compartments, buyers point out the absence of a trapdoor to access the other enclosed roof space, as stipulated in UBBL.
Other cited grievances include poorly installed structure bars, mispositioned reinforcement steel bars, unaligned walls and doors, insufficient fencing height, hollow gate pillars which make auto-gate installations impossible, shared rainwater downpipes which increase the possibility of internal flooding, low-grade material for box-up of explore bars, brittle walls, multiple cracks on doors, low water pressure, incomplete insulation for electrical wirings and inadequate waterproofing, causing water to seep through ceilings.
Leong, a purchaser, also highlighted the developer’s failure to append a copy of the approved building plan to the sale and purchase agreement (SPA). After much hassle, he finally obtained the plan almost two months after the handover. The developer justified its action by saying its standard practice was to attach only extracts of house images from the approved plan.
In response to Real Spaces’ enquiry, the National House Buyers Association’s (HBA) secretary general Chang Kim Loong emphasised that disclosure of a full set of detailed approved documents was made mandatory effective Aug 1, 2014.
“In fact, this has always been a legal requirement. As far as landed properties are concerned, the approved layout plan and the approved building plan are to be included in the SPA. These plans are normally exhibited in the developer’s sales office and showroom. Smart buyers will ask for it,” Chang advised.
Noticing the different reference numbers between the approved plan and the one stated in the SPA, Leong questioned IOI which replied that the change was a result of reducing four of its units to accommodate two guardhouses.
However, Leong noticed some discrepancies between the plan and the actual built-up; mainly a different gate design, different finishing material for the house tops, missing shower screens, non-adherence to the 50mm drop from kitchen to yard and a 10mm reduced size water pipe.
HBA’s Chang stressed nobody can change approved plans without buyers’ prior consent. As the architect has denied any inconsistencies, Leong lodged a complaint to the Board of Architects Malaysia (LAM). Thereafter, LAM has issued a letter to the architect, giving it up to Oct 21 to respond to the complaints.
“IOI is a reputed developer but, unfortunately, it seems like there has been a lapse in quality control in this instance and that is disappointing from such a big corporation,” lamented Leong.
Delivered in June, many buyers complained their houses were not fit to be occupied because the defects were too numerous. Some have even accused IOI of hastily pushing through the handover to avoid paying more liquidated ascertained damages (LAD) due to late delivery of vacant possession, which some units have received.
Others point out the incompleteness of the handover, whereby water pressure tests were carried out thereafter and TNB meters were installed only about two months after handover.
“The progress of rectifications was so slow that on Aug 18, some owners staged a protest in front of the IOI office. The general manager promised the media to settle the problems within 30 days,” Leong revealed.
Although IOI has said not all of its 281 units are affected, a total of 528 defect complaint forms have been received as at Sept 23, based on the latest rectification list. Rectifications have been ongoing from June 11. As at last week, only 200 of the complaints have been rectified.
An action group of about 10 buyers have met with representatives from the developer, including IOI Group’s senior general manager Simon Heng as well as the architect and contractor. A total of four meetings were held from Aug 8 to Sept 2.
In replying to Real Spaces, Heng explained: “The investigation into Alpinia shows that the cause of the substandard workmanship is primarily the contractor that was appointed to carry out the building works. Although the contractor was appointed after going through the normal stringent tendering process in IOI, the contractor later suffered site problems especially in its management and supervisory staff. Although the contractor is a well-known and established contractor in Iskandar Malaysia, having years of experience and now having many jobs at hand, it appears that in this case, the problem in the management and supervisory site staff has affected our project badly.”
Heng added: “IOI has already established four teams of more than 80 workers to rectify the defects and speed up the repairs so that buyers can move in as soon as possible. All the normal defects will be completed within the time allowed in the SPA. As for the major defects, we have a separate group of workers to handle them, and the repairs will be completed in tandem with the other repairs.
“Such substandard work is not to be expected in an IOI development. In this case it was an unfortunate result of the appointed contractor’s internal problem. Having said that, IOI is responsible for the products and we will endeavour to repair the defects to the buyers’ satisfaction.”
However, Leong said buyers remain dissatisfied because the speed of the rectification work is too slow and they are already paying instalments on their mortgage.
Others complain that the rectification work, carried out by the same contractor, is also substandard, and in some cases, has caused further damage.
“[There is] no proper monitoring of workers who consist mostly of foreigners that have problems communicating with house owners,” another buyer bemoaned.
Adding to the disquiet, some empty units have been allocated as the workers’ temporary lodgings. Buyers also dare not attempt any renovations in case the defects are blamed on them.
“Following this case, we have made changes to our processes to ensure that only good and competent contractors are appointed to do the job,” said IOI’s Heng.
“We have identified weaknesses in our own supervisory system and corrected them, and we’re restructuring our quality assurance system. We are already checking on our other projects to make sure that such a case doesn’t happen again.”
Although IOI has offered to waive maintenance fees till Dec 31, it has not responded to appeals for additional compensation.
Ng, a member of the action group, has made this appeal to the developer: “We bought Alpinia mainly due to the reputation of IOI. Tan Sri Lee put in his utmost effort to build up the company for 30 years. That reputation should be upheld. Whatever the mistakes or defects are, rectification should be done properly. Execution and supervision by skillful people are critical. Don’t rely on [current contractor] alone. Most important is the responsibility.”