NSW Landmark Strata Renewal Decision

Part 10 of the Strata Development Act 2015 (‘the Act’) allows owners of Strata Schemes in NSW to instigate a sale or redevelopment of their strata renewal plan, providing 75% or more of the owners, and the NSW Land and Environment Court ensure that the plan is just and equitable. Although, the provision has been in existence for almost 3 years, on 8 August 2019, the first ever application under part 10 of the Act was brought before the Court. The case of Application by the Owners – Strata Plan No 61299 [2019] NSWLEC 111 involved a scheme comprising 159 lots, where all lot owners were investors (except for one apartment and car space) and were leased to a serviced apartment business. The applicant sought an order from the Court to give effect to the strata renewal plan, and the collective sale of the scheme. In giving effect to the plan, the Court was satisfied that for the purpose of the Act, the distribution of proceeds of sale to each lot, was just and equitable in the circumstances. The Court also ordered the owners to sell their lots in accordance with a deed of agreement between the developer and strata renewal committee. The decision of this case is a great outcome for not only the owner group, but also strata owners in NSW, as it provides direction as to the Act’s effect, and acts a guide for Owners Corporations interested in strata renewal.

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