Short-stay operator backs down

City of Melbourne action against short-term accommodation in Docklands residential towers has been bolstered by the withdrawal of the major operators from a Building Appeals Board case.

Short-stay operator Yezz Pty Ltd, which operates Grand Harbour Accommodation, was representing 22 owners in the case.

Last year the council issued building orders against 30 owners using apartments for short-stay accommodation, challenging them to either cease trading or comply with onerous building regulations applicable to hotels.

At the time, some owners stopped using their apartments as serviced apartments while 26 appealed the orders in the Building Appeals Board.  

The Building Appeals Board (BAB) reconvened on October 9 in an attempt to establish whether or not Yezz was withdrawing from the case.

Yezz wasn’t represented at the directions hearing, and BAB chairman Leslie Schwarz issued directions to establish if Yezz was still appealing council’s decision to issue the building orders.

Watergate Owner’s Corporation (OC) lawyer Tom Bacon said it was understood that Yezz had withdrawn its representation of the owners in early October and that those owners had had their appeals dismissed by the BAB.

However, the BAB said a determination to dismiss the appeals of the owners had not been issued yet.

Yezz declined to speak with Docklands News.  Its lawyer Toby Cogley also declined to comment.

Only four owners remain in the case, represented by Docklands Executive Apartments.

The appeal before the BAB reconvenes on November 5.

Yezz’s appeal was being heard alongside the case of short-stay operators Paul Salter and Belinda Balcombe, who own Docklands Executive Apartments.

Each party had different legal representation but both were arguing against the City of Melbourne’s claim that the operators were breaching the Building Code of Australia.

The council is using the Watergate example as a test case in an attempt to outlaw the practice of using residential apartments for stays of less than 30 days.

City of Melbourne alleges that short-stay rentals should be classified as “class 3” which is usually reserved for hotels and rooming houses. Watergate is a residential building and classified as “class 2”.

It is widely held that the costs involved in converting apartments to comply with class 3 would be prohibitive.

It appears that Grand Harbour Accommodation will soon cease operations at Watergate as its online booking system is not taking bookings after November 7.

The Watergate case is being watched with interest by short-stay operators around Australia.