There are six (6) basic rules I believe a Building Manager needs to follow to ensure that their investment is protected.

1. Get the right advice. Management Rights is an area for specialists only – don’t engage a solicitor, accountant, banker or a finance broker unless they actively work in management rights on a day to day basis. only a handful of professionals know the business and work in this area on a full-time basis.

Many professionals will tell you that they know what they are doing in this area but the reality is, only a handful of professionals know the business and work in this area on a full-time basis. It is a trap for new players.

From a legal perspective, if you end up on the wrong side of an owners’ corporation and they want you out, they will engage a specialist strata solicitor who will go looking for flaws in your agreements or how your agreements were entered into. It is only when things start to go wrong that your legal structure will come under scrutiny. By then, it is too late to have it rectified.

If you are unsure if your set up is 100% correct, have it reviewed by a specialist solicitor now. If something needs changing, your owners will support you whilst they are happy with you. The costs involved will be insignificant in the overall context of what you could lose.

Remember, if your agreements are not right, you do not have anything to sell!

2. Treat your owners as your partners
Never, never, never take your owners for granted! They are your life-blood.

By looking after your owners you are securing your goodwill.

Most owners don’t want much. The key to any relationship is communication. Don’t just rely on your end of month newsletter. Set up a program to ring your owners on a regular basis. There is nothing like personal contact. This makes your owners feel comfortable enough to pick up the phone and call you if and when they have a concern about something.

If you have a slow rental month, explain why. If money needs to be spent on the unit, sell them the benefits of the expenditure. If your lines of communication are good, they will support you when you may need their help (like extending your term!).

3. Develop your people skills
The success of your business will be closely linked to the success of your people skills. It is a real art! As a service provider, you have to learn when to roll with the punches and when to draw a line in the sand.

When you do draw the line, make sure that you don’t over react or back yourself into a corner that you can’t get out of. You need to be firm but polite. It is not always easy! Some people naturally have these skills - others don’t and have to develop them.

4. Know your duties and record your work
Your caretaking agreement is a contract between you and the Owners Corporation. You are required to perform specified duties in exchange for remuneration.

Clearly, your must know exactly what your duties are. Not only must you carry out those duties, you should record (on a daily basis) what you did and when you did it. If you are later questioned by the committee about your performance, you can always hand in your daily work sheet. This is a very valuable tool in the event that you end up in a dispute with your owner’s corporation over performance.

I also recommend that you have your committee (or strata manager) check through your daily work sheet once set up to ensure that there is no misunderstanding as to the nature or the extent of your duties.

5. Isolate the Agitator(s)
I don’t know why it happens like this, but every building (no matter the size) always seems to have someone who we call a “condo commander”. These people seem to dedicate a good part of their day checking on or making the managers life miserable. It is not unusual for these people to seek election to the committee - where they can really do some damage!

If you cannot successfully negotiate or reason with these people, you need to isolate them from their fellow committee members or owners. You do this by ensuring that the other committee members and owners fully understand that you are doing what you are required to do under your agreement and you are doing it to a proper standard. Make it clear that the agitator is totally unreasonable in their dealings with you. By doing this, you will eventually isolate that person to such a degree that their views will be discounted when that critical vote is taken.

Also remember that at the end of the day, most resolutions only require a 51% majority vote. It is also my experience that when the agitators don’t get their way, they eventually take their bat and ball and move on.

6. Plan to take your holidays
Managers generally work very long hours. They usually live on site and can’t get away from their work. Accordingly, they must plan and take regular holidays. If they don’t, they will become stale, agitated and their business will suffer.

If Managers plan their holidays each year (well in advance) they will bring that necessary balance to their life. Most people don’t realise how badly they need a holiday until they are actually on holidays. It is too easy to find excuses why not to have holidays with many thinking that they will take a long break when they sell their business after 3-4 years. Don’t fall into this trap!

Plan early, secure a good replacement and obtain the committee’s consent (if required by your agreement). Remember however that a breach of the agreement by your replacement will constitute a breach of the agreement by you. The key is to find the right replacement early and book them on a regular yearly basis if possible.

Liability limited by a scheme approved under Professional Standards Legislation
Disclaimer – This article is provided for information purposes only and should not be regarded as legal advice.


Management Rights Articles


    As practicing accountants and CA’s, with over twenty years experience, and heavily involved with this industry, we would like to help guide you through the purchase operation toward eventual sale of these businesses.

Visit Us

Contact Us