For more than two years, the lights have stayed off inside what was meant to be one of Parramatta’s most striking new residential towers.
The 24-storey Observatory Place, billed as an ‘architectural marvel’ in Sydney’s second CBD, has stood empty due to serious construction defects which saw it deemed unfit for residents.
Now, after years of limbo, work will finally begin this year to fix the flaws that turned the tower into a symbol of Sydney’s building crisis.
The NSW Building Commission confirmed the long-awaited breakthrough, revealing liquidators Ernst & Young and receivers Newpoint Advisory have appointed a builder to carry out rectification works.
Completed in 2022 on the former site of the Lone Star Tavern, Observatory Place was marketed as a premium lifestyle address in a booming precinct expected to house more than half a million people by 2040.
Instead, entire floors have remained dark.
In May 2023, NSW Fair Trading refused to issue an occupation certificate after inspectors uncovered ‘serious defects’.
Among the most concerning issues was defective plumbing in the basement, creating unhealthy and potentially dangerous conditions.
For more than two years, the lights have stayed off inside what was meant to be one of Parramatta’s most striking new residential towers
An artist’s impression of the Observatory Place residential apartment complex in Parramatta
Without an occupation certificate, buyers were not required to settle – an unusual situation that spared them from paying for apartments they could not legally occupy.
At the time, developer Parkmeng promised buyers the problems would be fixed and the project brought into compliance.
It never happened.
By 2024, Parkmeng had collapsed into external administration, leaving the tower unfinished, empty, and mired in uncertainty.
Behind the company were familiar names in Sydney’s development world: Fayad Fayad, Remon Fayad, and their father Sam Fayad, the same family behind Dyldam, a property group that imploded in 2020.
The Dyldam group was once Australia’s second-largest residential property developer.
It has since become synonymous with defective apartment projects, including developments in Rosebery and Baulkham Hills that attracted sanctions from the NSW Building Commissioner.
Sam Fayad also presided over what is believed to be the largest personal bankruptcy in Australian history, with debts exceeding $2.8 billion – including almost $50 million owed to the Australian Taxation Office.
Behind the company were Fayad Fayad, Remon Fayad and their father Sam Fayad – the same family behind the collapsed Dyldam property group. Sam Fayad (pictured right) with his wife Maria (pictured left)
Construction lawyer Bronwyn Weir (pictured) says licensing developers could help prevent buyers being left with unsafe, unfinished buildings
His sons have also declared bankruptcy and are carrying substantial tax debts.
Construction lawyer Bronwyn Weir said Australia’s race to build housing to accommodate unprecedented numbers of migrants, was resulting in rushed jobs with poor workmanship and serious gaps in regulatory oversight.
She said there was a strong case for licensing developers, a reform the ACT Government has already adopted and will roll out next year.
‘Licensing would mean that a developer’s history could be checked before they are given a license,’ she said.
‘It would also mean that they could be excluded from developing again if their projects are defective and they do not fix them when ordered to do so.
‘It is also important that directors are made personally liable where the development company becomes insolvent leaving behind defective buildings.’
Ms Weir said that while buyers at Observatory Place had endured years of disruption, they had ultimately ‘dodged a bullet’ compared with what might have happened if an occupation certificate had been granted and settlements forced through.
‘Pulling up projects during construction and preventing off-the-plan sales from proceeding is an excellent safeguard for consumers,’ she said.
On Christmas Eve 2018, hundreds of residents were evacuated from the 36-storey Opal Tower at Sydney Olympic Park, less than a year after the complex was finished
‘It is much harder and more costly to deal with defects post-construction, especially in strata buildings where there are multiple owners.
‘The best thing that governments can do is increase independent inspections and oversight during construction and ensure there are strong powers to pull building works up hard and fast when defects are detected.’
Such safeguards might have prevented the crisis that erupted at Opal Tower in 2018.
On Christmas Eve that year, hundreds of residents were evacuated from the 36-storey tower at Sydney Olympic Park less than 12 months after it was completed.
Less than six months later, confidence in new apartment buildings was shaken again when cracks appeared in Mascot Towers, a 10-storey block in Sydney’s south-east.
