This post about split management in strata plans has been provided by Michael Ferrier, Eyeon Property Inspections.
Question: We live in a small strata scheme of 6 lots. Can 3 lots be self managed and the remaining 3 lots appoint a strata manager?
We live in 6 unit townhouse divided into 2 buildings. Each building has 3 units attached.
3 units are unhappy with our Strata Manager and want to get a new contract with a new company, but the other 3 units do not want to change.
I read that small building like ours are usually Self Managed Schemes. Can 3 units be Self Managed and can we get a new contract with another Strata Manager to manage the other 3 units?
OR can 3 units be managed by the current strata manager and the other 3 units be managed by another Strata Company?
Answer: This would add unnecessary complexity and would also add costs to the management of the complex.
Based on the information you’ve provided it seems most likely that, although there are two buildings, all six units are part of one Strata Plan. In that case, it would not be feasible to split the management of the plan. Each unit is part of the plan and one set of records for the plan.
It would be important to keep the records together as the complex shares one owners corporation. The best solution is to come to an agreement among the owners about the best way to manage the strata plan. Whether that is with the current strata manager, a new strata manager or to convert to self-management.
If each building was to be set up as a separate strata plan it might be possible to split the management, but there would be some work involved in splitting the records and setting up new financials etc. One area that could make this option complicated would be common areas shared by the two buildings (such as gardens, driveways or a pool). If the management of the two buildings was split, you would still need to jointly manage the community property. This can be done by establishing a community association to manage the shared facilities. In my view, this would add unnecessary complexity and would also add costs to the management of the complex as the community association would also have to be managed and be funded to maintain the community property.
We are not legal advisers so we do not have any experience in setting up these structures. Our comments are based on our experience gained from seeing the circumstances in many strata plans. If we can be of any further assistance please don’t hesitate to contact us directly.
This post appears in Strata News #405.
If you have a question about split management in strata plans or something to add to the article, please leave a comment below.
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