Working with a professional property manager from the outset of a development is a win-win situation for all.
Property development is a complicated process. From insurance and legislation to traffic flow, by-laws, building codes and standards, there are a series of issues that require expert advice.
For developers, nothing beats having an experienced strata or property manager working with them from day one – helping to make sure the whole journey is that much smoother.
Having a property manager on board early is important, but there are also key moments during the process when seeking their help will make the process easier. To give you a better idea, let’s break it down.
Start early
The earlier one can consult with an experienced property manager, the better. From day one, having a qualified expert in your corner will make going to market with your development much easier. Tackling the process solo – and potentially getting it wrong – can create monumental problems down the line.
A property manager can offer expertise in insurance, certification, legislation, green space and planning, as well as all the grey areas in between. In a nutshell, they can help ensure the development runs smoothly and that all bases are covered.
With a property manager on the team from the get-go, one can save a lot of money, time and hassle – not just in taking your development to market, but also when it comes to dealing with changes in legislation, reporting to council or town planners, offering ongoing advice and building better communities.
Write by-laws specific to the development
Put simply, by-laws are a set of rules that govern a particular strata scheme. They cover the behaviour of residents and the use of common property, as well as other things such as parking and noise levels, how smoking is regulated, and whether pets are allowed on the property or not.
It’s important to note that by-laws can vary dramatically from scheme to scheme. While each state and territory sets out model by-laws for different schemes, each development can also draft its own additional by-laws. This is a task best delegated to someone that knows the requirements and can draft the first set. The by-laws that apply to a scheme will then need to be then lodged with the Lands Titles Office.
Estimation of strata fees
Calculating strata fees (also known as levies) is a very individual process – no two buildings are exactly the same and an experienced property manager can provide
invaluable insight into what may be required. From building maintenance and insurance, to onsite caretakers and sinking fund costs, there are many variables that impact how much the fees for the building will be.
How does the process work? Every year, the committee will sit down and hash out what the body corporate needs may be. The amount that is totalled up to cover these needs becomes the “administrative fund”. They will also have a “sinking fund” – which is there to cover expected and unexpected long-term expenses.
But how are the levies estimated? They are calculated based on a Lot Entitlement. Sometimes all the lots have equal entitlement, but sometimes they don’t. Lot Entitlements are a percentage of overall costs each Lot pays based on a calculation taking into account things like size, bedrooms, car parks, balconies and other benefits.
Set up service contracts
For all developments, there needs to be service contracts set up with specific vendors. These might include businesses and companies that deal with the lifts, fire equipment, caretaking, building security and repairs.
It goes without saying, it’s important that these service contracts are organised and agreed from early on. Talking to a property manager and getting them involved in these processes will ensure the development runs a lot smoother.
Why? Because these contracts can often be large and complex, and the legislation surrounding them can often change. Having a property manager help set them up will ensure everything is written properly, which will reduce the risks of encountering legal problems down the track.
Building a healthy partnership
Building a solid relationship with a property management firm from the very beginning is crucial to the success of a development.
For a developer, a smooth process and well-sold development enhances their reputation, which means better buying power, increased buyer confidence, easier financing and more opportunities to work with superior contractors and suppliers. For the property manager, if developers and buyers have a better experience, it’s more likely they will stay with them.
The best source of knowledge is experience: lock it in before breaking ground.
