A student accommodation building in Brisbane has been denied occupancy permits by local government due to concerns over the installation of potentially combustible non-compliant cladding on its exterior.

The Queensland Department of Housing and Public Works refused to provide occupancy permits for a residence in the Iglu student accommodation building on Mary Street in Brisbane, while the Brisbane City Council indicated that it was investigating issues in relation to building product issues.

Iglu is majority owned by Macquarie Capital and Singaporean sovereign wealth GFC, who acquired the development in 2014 with the hope of reaping robust earnings from the strong demand for accommodation amongst overseas students.

The Queensland government’s decision to deny occupancy permits to residents has scuppered these plans, and has reportedly compelled Iglu to find alternative accommodations for tenants who have already entered agreements.

Iglu has nonetheless issued an statement via its official website claiming that concerns over fire safety issues were “alarmist and absolutely misleading,” and that the company was “satisfied and absolutely confident that Iglu Mary Street is of high quality and safety standard.”

Concerns have risen over the use of sub-par building products within the Australian construction industry following the fire which broke out at Melbourne’s Lacrosse Apartments toward the end of 2014.

An official investigation into the fire concluded that the use of non-compliant exterior cladding abetted the spread of the blaze across multiple floors of the building.

The use of combustible exterior cladding is also believed to be responsible for a fire which spread across a high-rise hotel in Dubai on New Year’s Eve, with reports that the use of similar materials is rife throughout the region.

Jarrod Edwards, the Victorian Building Authority’s director, technical and regulation, recently said the use of non-compliant building products was a serious problem for inner-city Melbourne.

A recent VBA audit of 170 buildings in the CBD and surrounding suburbs of Melbourne uncovered what Edwards’ called an “unacceptably high rate” of the usage of non-compliant materials.