The Mega **Management Company** thread

capistrano

A lot of us now own appartments in Ireland and we pay annual service charges. However, as these increase every year it is hard to know whether or not we are getting value for money because there is no transparent list of the charges for the various appartment complexes.

I think it would be a good idea for people to say what they are paying in their complex and then we can build up a list so that people can see if they are getting good value or not.

I'll start off with my own case.

Complex: Tolka Vale, Finglas Road, D11
Appartment: 2 bed
Annual Service Charge: €1490 plus insurance of approx €670; total €2160

Borzoi

Man you're getting raped.

Complex: Fernleigh, Carpenterstown
Appartment: 2 bed extended (1035sqft)
Annual Service Charge: €1000(app) plus fire ins. of approx €270 (app); total €1270
Management Agents: Wyse

General: My place is small enought that there are no lifts and big enough not to need electronics gates (ie there's plenty of parking) both these items have huge maintenance costs associated with them. There is no on site caretaker, but the agents have a 24hour number.

The agents service could be regarded as mediocre

capistrano

Good idea to mention managing agents:

Tolka Vale uses KPM.

It has lifts and electronic gates.

Victor

You should get the management committee / company to present accounts every year. after all it is your money.

One of the things to avoid in such apartments is a painted exterior and large amounts of common areas (lobbies, stairs, common rooms, etc.)

Also, are your refuse / recycing charges included or separate?

Cuauhtemoc

Some more details...

Complex: Hazelgrove, Tallaght.
Appartment: 2 bed
Annual Service Charge: €1500(app) 85% increase from last year.
Management Agents: RF Property Management.

A breakdown on individual charges may be useful to compare value for money.
I Don't have any comparisons to tell whether these are good or not tho.

Insurance : €11,000 (Mix of 63 1 & 2 bed apartments in 3 blocks)
Lift Maintenance : €4,500 (3 lifts)
Electricity : €5,500
Internal Cleaning : €8,600
Garden Maintenance : €4,000
Reserve : €25,000, No idea what that's for.
Repairs & Maintenance: €11,000, Gates - 3,000 & Maintenance Visits 5,000.

Bin charges aren't included but the cleaners do put the bins out.

Personally i feel that the charges for most developments are too high, anyone agree?

Incidentally the charge for a 1 bed apt is €982.

_______
C.

_____________________
What could have happened...did happen!

Victor

Originally posted by Cuauhtemoc
Reserve : €25,000, No idea what that's for.

Eventually after 10-25 years from construction, you will need to start replacing major items - automated gates, lifts, windows and doors in common areas, lights, external paving, etc. This is what the reserve is for.

Just make sure the reserve is properly invested and adequately protected from someone doing a runner with it.

The insurance seems way too low - the buildings must be worth well in excess of eur5m which would imply insurance in the order of eur100k

capistrano

Originally posted by Cuauhtemoc
Complex: Hazelgrove, Tallaght.
Insurance : €11,000 (Mix of 63 1 & 2 bed apartments in 3 blocks)

This insurance seems way too low. Ours is approx. €50k for complex of about 90 apartments. Unfortunately, if I were you I'd expect it to go up. Most other headings seem reasonable, but we don't put quite so much in the reserve.

Cuauhtemoc

I think the valuation was around 12 million for the complex so i suppose the insurance does seem quite cheap.
Ah well more increases to look forward to.

Victor

Originally posted by Cuauhtemoc
I think the valuation was around 12 million for the complex so i suppose the insurance does seem quite cheap. Ah well more increases to look forward to.

The €12m valuation would appear to be a market valuation for the buildings and site. If there is a fire the site is still there, so you don't need to insure the site against fire. And it doesn't cost €200,000 to build ordinary appartments.

Say 21 one bedroom apartments @ 50m2 = 1,050m2
Say 42 two bedroom apartments @ 60m2 = 2,520m2
Total = 3,750m2 @ say €1,750* = €6,247,500 + €2m to cover external areas, lifts, fittings etc. = ~€8,247,500. This of course being a complete guess.

It would **appear** to be woefully cheap insurance. I would ask the management as to what exactly is covered by it. I presume you don't insure your own apartment separately, this would be highly unusual. Contents insurance of course would be separate.

The insurnace needs to cover more than just fire - it also needs to cover flood, storm, puclic liability and a number of other headings.

* http://www.scs.ie/publication/hri.asp gives a good guide for houses, which while not perfect for this apartment example, is a good guideline.

DaithiSurfer

1 Bed Apt applewood village Swords
€700 pa all-in managed by KPM

You get a breakdown of costs every year and an estimate of costs for the following year. I think you guys are being robbed. Remember, collectively you own the apt management company, so bring the accounts to an accountant every year.

pthagonal

just bought a 3 bed apt in applewood.

maintenance is 1200 per year all in..

and that includes rubbish..


others seem very pricy..


pthag

cardigan

2 bed apartment in the Tramyard, Inchicore, Dulbin 8.
Service charge: €1177
Management company: KPM

KPM are hopeless, ignorant and talk their way out of everything. The complex has lifts and electronic gate, my fee does not include rubbish (€160 per year to the council) and I pay €100 in that fee for 'car park maintenace' because I paid £5000 punts for a car park space.

DaithiSurfer

Originally posted by cardigan
2 bed apartment in the Tramyard, Inchicore, Dulbin 8.
Service charge: €1177
Management company: KPM

KPM are hopeless, ignorant and talk their way out of everything. The complex has lifts and electronic gate, my fee does not include rubbish (€160 per year to the council) and I pay €100 in that fee for 'car park maintenace' because I paid £5000 punts for a car park space.

What do they need to do to maintain a parking space for gods sake.

With KPM you really have to scare them of the fact that you and your fellow owners WILL fire them if you catch them messing. This really puts manners on them.

Anyway, its all well and good complaining here but you really need to get your group together and then as a unit challenge the management company. Make them cop on.

One thing i pay for in applewood that doesnt happen is window cleaning. I complained about this only to be told that yes they do clean the windows. They dont. My name is written in the dirt on the outside of the window for the last 2 years. They havent been cleaned at all.

cardigan

I guess you have to pay for the lights in the carpark and the car park gate - it wouldn't be fair for people who didn't have a space to pay for it....but then why do those people complain when they are clamped for using the car park - anyway, after 3 yrs of fighting with KPM I have given up, most of us have. We are not in a position to fire KPM as the developer has not handed over full ownership yet we have been told. The develpement has been finsihed a long time now but it takes 10 years to handover, that's what they said. KPM couldn't give a rats if we fired them anyway, sure they will have another Danninger develpment the very next day - I am of the opinion that Danninger (Zoe) and KPM are in cahoots.

Also the window cleaning (€3000 per year on the accounts) has never taken place, never ever - I too have my name in dirt on the outside of my window and only the rain has faded it.

Victor

Originally posted by DaithiSurfer
What do they need to do to maintain a parking space for gods sake.

Lighting, cleaning, annual and periodic maintainence.

flav0rflav

It's all well and good to suggest that the residents act in making the management agents more accountable, but, if the developers still have directorial control of the management company, then there's f'all y'all can do.

The management company is made up of the residents, but at the start there aren't any residents, so the developers install themselves as the directors, usually with more voting rights than the normal members. They are supposed to resign at a suitable moment, which is usually left up to them.

The management agents are appointed by the directors of the management company. The directors sign the checks. The management agents are on to a winner as long as they keep the developers sweet.

I'll post some figures for my apartment block later.

Gillo

I don't own an appartment, but looking at the figures you are paying and the fact that you seem pretty pi**ed off. You could take a case to the small claims court. If the appartment went as a group the value woudl be too high, but if each "house hold" brought an individual case for the money they had spent on the service it woudl be small enough to qualify.

In an block with 50 appartments thats a lot of hassle for the management company to start taking notice.

cardigan

To bring this topic up again under a different umbrella...has anyone any experience of not being able to fire the management company because the developers are still the main shareholders and directors in the management company (made up of residents) and what did you do?

We are a complex of 246 apartments all extrememely unhappy with the service KPM have provided and the way in which Danninger Developments have left the complex after completing building over 12 mts ago. There is nothing we can do I have been told - we can't get a snag list or money out of Danninger, nor will they sign the development over to us as completed so we can't get rid of KPM and at least be given the chance to start from scratch. We are running around in circles for over 3 years watching our property decrease in value because the complex is in a terrible state.

I would appreciate any advice you could give me, please post of PM me.

Victor

Form your own residents company, hire a solicitor and a surveyor (or other property professional). There are probably a bunch of different routes to go including breach of contract and / or specific performance.

Are the properties covered by Homebond?

cardigan

Hi Victor

Yes all the properties are covered by Homebond, they are max. 3 years old. We are looking into your suggestion, thing is, it's actually quite difficult as there are over 240 apartments in the complex so it's difficult to track down all the owners and get them to agree - also, people are not hugely willing to pay for a solictor etc. as they have already paid 1200 in fees this year. Thanks for your help, I will post if we meet with any success.

Ardent

The Malthouse
Marrowbone Lane, D8

Management company is RF Property Management

1072 euro p/a management fee, includes insurance
125 euro p/a car parking space maintenance fee

Brand new development, not all owners/tenants moved in yet. Development constructed by Danninger, for what it's worth.

Victor

Originally posted by cardigan
We are looking into your suggestion, thing is, it's actually quite difficult as there are over 240 apartments in the complex so it's difficult to track down all the owners and get them to agree - also, people are not hugely willing to pay for a solictor etc.

You don't need everyone, just some, all you need is enough to pay a solicitor to write a few nasty letters (<€250).

One way to contact every body is to simply drop a leaflet into their letter box and address it to the "owner" (some will no doubt be let out).

ken90

There moght be a case under the Companies Act under "Oppressed Shareholders", where a development has not been handed over.
About the dirty windows, I would ask for details of the contract and the Contract Cleaners concerned.

If people are not willing to pay the small share of the charge to pay a solicitor they have only themselves to blame.

Remember that "Services" now are SERIOUSLY" expensive. Experienced tradesmen are now the new stockbrokers!
If you want a well maintained block, it will cost serious money.
Insurance costs have skyrocketed, Management Companies are in business to make a Profit! So are you!

Also remember that there is no serious competition in this field, and you may have difficulty hiring somebody to replace them.

Somebody mentioned that the value of the site would not need to be covered for Insurance purposes - True- but;

Dont forget the major cost of clearing the site of a burned out Apt. complex.


The Laurels, Rathfarnham.

900 Euro P/A

Bin charges extra.

Privately managed.

Mr Man Time

Originally posted by Ardent
The Malthouse
Marrowbone Lane, D8


125 euro p/a car parking space maintenance fee

What maintenance does a parking spot need? jeez

Ardent

Originally posted by Mr Man Time
What maintenance does a parking spot need? jeez

I know, crazy isn't it? I haven't paid it yet, f*** 'em.

Victor

Originally posted by ken90
Somebody mentioned that the value of the site would not need to be covered for Insurance purposes - True- but; Dont forget the major cost of clearing the site of a burned out Apt. complex.

Demolition / site clearance is a separate insurance heading.

Originally posted by Mr Man Time
What maintenance does a parking spot need? jeez

Lighting, security, auto-gates, extra storey on the lift, insurance ....

irlirishkev

Ardent

How many apartments are in your block?

I've just bought in Temple Place Apartments, D1. 12 apartments. Brand new. Also built by Danninger, and maintained by RF.

1300e Service Charge. As yet, no car park fee mentioned...

Kevin.

Ardent

irlirishkev: About 95/96 apts. The difference in number of apts between you and me must be the reason for the different management fees, but still...!

Victor

http://www.thepost.ie/web/DocumentView/did-410450676-pageUrl--2FThe-Newspaper-2FSundays-Paper-2FNews-Features.asp

Fees hikes take toll on apartment living
25/07/04 00:00
By Susan Mitchell

As increasing numbers of people opt for apartment living, many look set to face escalating costs for the upkeep of their developments.

Management agencies are reaping the rewards and have reported significant profit increases as a result of large maintenance service charges.

The charges, which cover the daily wear-and-tear in an apartment block, have escalated dramatically in recent years.

Agencies manage the vast majority of residential developments built in recent years and those working in the agencies concede that fees have risen sharply.

In 2002, The Sunday Business Post reported that some apartment owners had seen their maintenance fees rise by as much as 300 per cent in a year. Not surprisingly, property management companies have more moderate estimates of rises.

Ben Gough, managing director of Wyse Property Management, estimated that the fees levied on owners had risen by about 50 per cent since 2000, but said this was ``market-driven''.

``Fees have increased, but that is largely due to the increases incurred in the day-to-day running of these developments,'' Gough said.

``A few years ago there was no charge for waste disposal.

"Security has become a bigger issue and insurance costs have also increased. Costs are escalating all the time.''

Management agency profits are also climbing. Abridged financial statements from Wyse Property Management showed that the company recorded a profit of €730,517 for the year ended August 2002.

That figure represented a significant increase on the €460,423 profit recorded in the previous year. The company had €1.2 million in the bank, up from €848,419 the previous year.

The most recently filed set of accounts from O'Dwyer Property Management reveal that the company recorded a healthy profit of €348,096 in the year to June 2003, up from €203,878 the previous year.

O'Dwyer Property Management had €569,600 cash at bank and in hand, up from €421,338 the previous year.

Abridged accounts for Keenan Property Management, which is based in west Dublin, showed that the firm trebled its profits to €100,285 for the year ended December 2002. The company is involved in ``block management'', but it also operates as a letting agency.

As service charges are set each year, it is impossible for potential buyers to determine how high future costs will be.

A typical leasehold agreement binds apartment owners to pay the service charge that the management company ``in its sole discretion deems to be fair and reasonable payment in respect of the year then commencing''.

In general, the more plush your apartment, the higher your service charge.

Costs soar when a development is equipped with an underground car park, numerous lifts, CCTV, a gym and landscape gardening.

It is for this reason that residents in the exclusive Hollybrook development on Brighton Road in Foxrock, south Dublin, pay between €5,000 and €6,000 a year - the highest recorded management fee of a residential development in our sample survey.

Similarly, service charges are also higher for larger apartments due to higher insurance costs.

At present, many apartment owners complain about a lack of transparency when it comes to determining how their fee is spent. A trend has also emerged whereby tenants are obliged to pay two years' service charge in advance.

Aideen Hayden, chairwoman of the national housing organisation Threshold, said the sector suffered from a lack of regulation and that tenants had few, if any, rights.

No agency is tasked with the responsibility for regulating property management companies, except the Irish Property and Facilities Managers Association, which is self-regulatory.

With planning permission for new apartments more than trebling between 1996 and 2002, apartment complexes now represent a substantial portion of the property market. This trend looks set to continue, as do escalating management fees.

The_Conductor

Just like to point out a few things:

Not all Apartment Complex Management Companies are run on a "for profit basis"- indeed, the rules governing the operation of many state that they may not make a profit.

I serve as the Managing Director on an Apartment Managing Company in Lucan. Its an unpaid position, and I, along with all the other owners, pay my full share of the fees. In the last 4 years the fees have increased by about 115%, the vast majority of the increase being a massive hike in insurance premiums. Apartment complexes are not insured at their market value- rather their replacement value, and many contracts negotiated with insurance companies over the last few years, while index linked, did not take into account the massive increases in building costs- meaning a lot of properties are either uninsured, or when a periodic assessment come up, are suddenly hit with massive unforseen increases in premiums.

In addition, there exists in many cases a "sink fund"- not a slush fund, but a manner in which retained management fees may be saved to pay periodic bills as they occur (e.g. painting the complex every 4-5 years, replacing woodwork periodically etc- not every day stuff).

Certainly, apartment management charges are expensive- its a fact of life though, and if you choose to live in an apartment with shared refuse, security, landscaped grounds, parking, building rates, etc etc etc- you pay them as opposed to paying for certain services individually. Refuse collection, part of your management charge, is deductable against tax at the marginal rate- to a maximum of Euro 195 per annum (for owner occupiers), or for those renting out properties in complexes- the entire management charge is tax deductable.

I have an issue with landlords who make their tenants pay the management charge- it is unfair and discriminatory- particularly as while the landlord can write it off against tax (unless he or she is normally resident in the property), the poor unfortunate must take the charge on the head without any discourse to a tax deduction of any sort.

I work fulltime- the last thing I need to do, is go home in the evening and start ringing companies about a problem with - bin collection, illegal parking, antisocial neighbours, malfunctioning electrics etc. For many people working on management companies- all we get is grief. We pay the exact same as everyone else, and do the work willingly for no recompense in our own free time (or even take time off work to organise contractors etc). All we get in exchange is abuse and illwill from naysayers, who couldn't be arsed to do their bit for their communities.

Its very like being in a reviled position of tax collector or something- only its an entirely voluntary position- that many people volunteer to do, because if they don't then no-one will.

Shane

capistrano

So, Shane, I take it you don't employ any management agents; your management company handles the day-to-day management. This is a lot of work and if you are doing it then I think the management company should pay you something for your efforts. We pay KPM nearly €20k per year - as you are saving this them maybe your management company should pay those who do all the work €10k between them.