This Q&A about mixed use developments and maintenance bills when there are multiple Strata Management Companies involved in NSW has been supplied by Yuhao Gu, Omega Legal.
Question: We are a mixed use development with residential and commercial in our building. Commercial does not wish to contribute their share to necessary exterior maintenance of the building. Are they legally obliged?
Does a commercial owner pay for maintenance works in a mixed used development?
We are an apartment building with 15 owners. The building has 3 levels. The top two levels are residential and are managed by one strata management company. The ground floor is commercial shops and residential and commercial car spaces. The commercial area is managed by a different strata management company.
Owners of the residential area have agreed to $450K of essential remedial and repainting of the building. The building is 16 years old and in its original state.
The commercial shops are all owned by one person. The quoted cost for their share of these essential works is only $5K but the owner will not contribute.
Is the commercial owner legally obliged to pay her share of the essential works?
Answer: There should be one strata management statement that ties the two strata plans together.
It will be surprising if the commercial owner does not have to pay. Normally for a mixed used development, the residential strata scheme and the commercial scheme are part of two different strata plans. However, there should be one strata management statement that ties the two strata plans together.
In your situation, ask your strata manager for a copy of the strata management statement. The strata management statement should set out how the costs for the maintenance and repair of your building are split between the residential and the commercial owners.
This post appears in Strata News #262
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