Strata Insurance – Quick Guide

This guide has been prepared by Bright & Duggan to assist owners and occupiers, it is not advice, and should you have specific queries, these may be issued to your broker or insurer for their response.

‘SSMA’ – Strata Schemes Management Act 2015 and its successors

Owners corporation is responsible for insuring the ‘building’ under a damage policy (S160 SSMA), which is the structure and includes owners fixtures within the lot (e.g. kitchens, bathrooms, flooring, etc). S161 of the SSMA deals with the further specific requirements for strata policies.
The owners corporation should routinely have the building valued for insurance purposes to ensure that the building sum insured is appropriate.
The owners corporation is typically responsible for any deductible/excess payment, however there is situations where a claim arises to only lot property (e.g. kitchen cabinetry) at the fault of the occupant (e.g. conducting renovations) and the owners corporation may look to recover the excess from the responsible party (per OFT advice). The by-laws for a scheme may also give rise to responsible parties paying excess in the event of certain claims (e.g., flexible hoses).
Where a broker is involved for the owners corporation they will generally lodge and manage the claim with the insurer and also advocate for the owners corporation,
All owners are benefitted under an insurance policy and have a right to lodge claims directly with the insurer, however claims will generally be managed by the strata manager, with the broker.
Owners should expect claims to be handled promptly, however in the event of large or complex claims, there is often time involved for quoting and assessment as these become large projects. There is cover within the building policy for loss of rent/alternate accommodation if a property is uninhabitable.
Insurance claims should be avoided wherever possible – claims will generally increase the cost of a policy and types of a particular claim (e.g., water damage) may increase deductible amounts under the policy. Insurers may also go off risk if policies exceed loss ratios. Just because a potential claim is notified does not require the owners corporation to proceed with a claim – it may choose to withdraw a claim (as it does not want to lodge a claim or repairs don’t meet excess).
Insurers do not cover defective works (e.g., balcony waterproof membrane), it will however generally respond to resultant damage arising from defective works.
We find it increasingly difficult to place cover for buildings with defects or extensive claim history and/or complexities (multi member BMC with high sum insured).

Event

Event Occurs (refer Product Disclosure Statement of particular policy – from the CHU residential policy, defined as:

means any partial or total accidental physical loss of, or destruction of property from any sudden and accidental cause not otherwise excluded by this Policy.

Common claims:

Water damage
Accidental
Impact damage
Malicious damage
Fire damage
Storm damage

Claims may be denied if they are not appropriately notified.

Notification

As soon as becoming reasonably aware of a claim, the owner/occupant/building manager/strata manager should inform the insurer (directly or via the broker).

The owners corporation should mitigate further loss (e.g. arranging dryers in the event that water has flooded flooring/slab).

Claim Assessment

Depending on the nature and scale of an insurance claim, the insurer may require:

Involvement of an internal or independent insurance assessor.
Multiple quotes for repairs
Involvement of a panel builder/trade

Claim Completion

An insurance claim is finalised once funds are repaid for repairs or repairs are carried out directly at the cost of the insurer. In the event that a claim is denied, insurers have internal appeal panels and the Australian Financial Complaints Authority (AFCA) can assist.

Owners’ obligations

Check for risk
- Inspect flexible hoses
- Turn off water to property if away for extended period
- Do not leave cooking appliances on if away from property
Notify early
- Advise the insurer/broker/strata manager as soon as practically possible in the event of a possible claim
Access/evidence
- Ensure to provide access to the property if required as part of any claim
- Keep maintenance records on file (owners corporation or owner if lot property)
- Always provide up to date contact details to the owners corporation

Strata Manager VS Building Manager

In the Lake Macquarie, Newcastle and Hunter area, I constantly hear differences of opinion between owners, committee members, service providers, strata managers and building managers as to what a strata managers role is when there is also a building manager contracted by the owners corporation.

Owners need to be better aware of what they are paying for and whether they are potentially paying for it twice (e.g. building manager should be issuing work orders as part of their fee, however, they ask the strata manager to issue work orders and they charge a fee to do so).

Furthermore, the understanding of what a building manager can and should be doing has changed greatly over the past decade – whereas once they were a cleaner with a tool belt (e.g. caretaker), they are very much now the professional onsite interface between residents, contractors and the strata manager.

We often educate potential and new clients as to who should be doing what. The Strata Schemes Management Act is somewhat vague on the role of a Building Manager and it’s defined as below:

STRATA SCHEMES MANAGEMENT ACT 2015 – SECT 70

Functions of building manager

70 FUNCTIONS OF BUILDING MANAGER

(1) A building manager may, in accordance with the building manager agreement appointing the building manager, assist in exercising one or more of the functions of the owners corporation of managing and controlling the use of common property (otherwise than by the owners or occupiers of lots) and of maintaining and repairing common property.

Noting the above, the scope of what is in the agreement between the owners corporation and building manager is what is important here, however, it’s now better understood what the role of a professional building manager entails:

Item	Strata Manager	Building Manager
Repairs / Maintenance	Administration with strata committee – e.g. approvals	– Issuing work orders – Contractor management (sourcing, insurance, SWMS, Site induction) – Monthly/routine reporting – Arrange quotes for committee review for routine and ad-hoc maintenance
Defects	Advisory/escalationManagement via committee/OC	-Processing / administration of in-unit and common property defects with builder – Escalation of common property defects to strata manager/strata committee where not addressed by builder
Moving	Collect bond if applicable	– Establish process for moving of goods over common property – Manage bookings/lift covers – Inspect common property for any damage
Software / Communications	Use of software for announcements if requiredInvolvement in Whatsapp committee groupIssue communications from owners corporation/strata committeeDeal with owner/committee queries in relation to owners corporation	– Management of Buildinglink or other system – resident database, announcements, – Management internal communications – e.g. Whatsapp cleaning group, committee group – Place signage on site as required – Dealing with all resident queries – e.g. metering, by-laws, approvals
AFSS	Approvals via committeeSubmission to council	– Source relevant contractors – Arrange inspections – Coordinate statement requirements
Site Inspections	n/a	Weekly inspection all common property areas – ensure proper functioning equipment, by-law breaches
Waste	n/a	Ensure functioning of chute/waste room and collection of rubbish with cleaner
Meetings	Manage all OC/SC meetings	– Prepare quotes/reports as required – Attend committee meetings – Potential involvement in sub-committees
Emergencies/out of hours	Provide out of hours contact service	– Provide 24/7 contact service for onsite issues – Attend site if required
By-laws	By-law escalation – e.g. final notice/notice to comply and any formal proceedings – committee action/approval	Manage first action – e.g. direct communication with resident via call/sms/email/in person
Bookings – common facilities	Assist in establishing rules/procedure for booking common facilities, including SC approval	Establish and manage the booking of any common facilities – e.g. BBQ area
Contracts	Execute and negotiate contracts as instructed	Obtain pricing for R/M OC contracts as required – Fire, lifts, pumps, cleaning, gardening, etc)
Budgeting / Finances	Prepare annual budgetsPay all invoicesReport to strata committee	– Assist strata manager with budgeting. – Invoice approval as required
Keys	Take deposits as required	– Issue keys – Authorise keys – Maintain key register
Community / Place making	Advice (insurance, etc)	Facilitate community events and other placemaking exercises
SSMA and other legal requirements	Manage OC compliance with the SSMA and other OC legislation	Be aware of the requirements of the building manager under SSMA and other relevant legislation – e.g. authorisations, timelines, approvals

NB – if BM fails to perform duties, SM steps in and manages at hourly rate if requested.

SC – Strata Committee

OC – owners corporation

Covid 19 – Strata and Building Management Perspective

We have now entered an unprecedented period for the 21st century with the onset of Covid 19 virus and the measures which need to be taken to control the spread of it.

Businesses across Australia and the world are all affected in one way or another – there’s very few that will be able to thrive in the circumstances due to the effect on our workplaces, clients, and staff.

The response in Australia is increasingly drastic and we need to adequately prepare for a difficult period over the next few months as services and facilities are shutdown or become increasingly stressed. We are blessed with one of the worlds leading health systems, however, we need to act with caution and be ready to give our support to the most vulnerable within our society.

Bright & Duggan and Cambridge Management Services have introduced a policy of having all frontline strata management staff work from home and ceasing face to face meetings – I applaud our Executive Management Team in reaching this decision as quickly as it did. The update is available on the front page of our website – https://www.bright-duggan.com.au/ . We have different policies for Building managers and other staff within the business – these are being continually updated.

Strata and building management business are very much affected by the fact that we have workforces that have a lot of external meetings, have a number of visitors to our offices, that we provide a variety of onsite services at buildings and have large numbers of office-bound administration staff. That said, we are able to offer a great number of our services remotely.

Some strata and facility businesses have the ability to enable their workforces to work from home (which wholly depends on the staff member having the technology to do so); it’s very difficult to offer building management services offsite when the contract requires onsite services.

We manage people’s homes (and in some cases workplaces, where we manage commercial schemes) and thus have very serious obligations to the occupants to show leadership during this time and do whatever we can to assist authorities in mitigating risks.

What should we all do as soon as possible:

Give staff the ability to work from home where possible and ensure that we are aware of the workplace that staff are working from – employers still have work health safety obligations where their staff work from home;
Support your staff with whatever circumstances are put on them (sickness, schools/childcare services ceasing for a period);
Cease face to face meetings and adopt alternate means of meetings provided for under legislation – this may include meeting via proxies, phone/video conferencing, online or paper voting papers, etc;
Take practical steps at your buildings to reduce the risk of infection – additional cleaning, signage, etc.

Some of the potential issues we need to overcome

Continuing compliance with strata legislation which can become difficult without being able to conduct certain meetings, arrange onsite inspections, etc;
Annual inspections – particularly annual fire safety statements;
Defect timelines and the potential inability to do defect inspections/commence proceedings;
Contractor attendance – what happens if electricians, plumbers, etc won’t attend site?;
Waste management (we presume that council and private collections will continue as normal – if they didn’t it would be bedlam) – we may have to deal with much-increased levels of waste in the event that buildings have all occupants at home for long periods;
Residents needing help and assistance throughout any period of enforced isolation;
Conflicting and complex legal obligations;
Owners/occupants coming under financial stress – non-payment of levies; and
Continuing to facilitate strata searches, collection of keys, etc.

One of the great opportunities we have here is to change the way we operate our businesses (with a move to electronic meetings) and provide help and support to people that need it most.

It’s not business as usual but we need to make sure this is the best business we can do.

Activated communities and placemaking

The rooftop at GWH Aero Apartments all decked out for a birthday party.

When we are involved from the early stages of a development (planning phases into registration/settlement and occupation), we have a role and responsibility in helping that community find its feet and activating the space that we manage. This is somewhat the case when we have the strata management of that community (i.e. a role largely offsite and administration based), versus when we are the building/facility manager – a role which is a daily/weekly in-person interface with the owners.

The view of Broadmeadow Racecourse from the rooftop at GWH Centrale Apartments Broadmeadow.

Modern design principles for apartments and community schemes (at least in Australia) give drive to the creation of a community and giving a building identity. This may include features (e.g. vertical garden, civic art), exclusive common areas (rooftop entertainment areas, gardens), naming the building or facilities (gyms, pools, treatment rooms, BBQ areas, concierge, valet, etc.) and nearby or inhouse retail offerings. Activated communities are safer, more secure and more enjoyable to reside in.

‘nook’ letterboxes – the colour coded theme continues throughout the building and helps make it a unique boutique development for the area.

Unless all of the above is well-considered, facilities may end up poorly utilised and not add value to the community. On the flip-side, beautiful common areas can be an extension of lot living space, allowing room for entertainment, recreation and community activities. These spaces end up being the ‘jewel’ in the crown of a specific development.

Playground and BBQ area with a view at Thirdis beautiful ‘Westend’ development, proudly managed by Cambridge Management Services

We have a wealth of examples of these ‘activated communities’ within our portfolio and in time, we will have great data as to how this drives improved sales values, rental yields and resident happiness.

Views from the Aero rooftop – always changing courtesy of the working harbour

Regardless of facilities, we think that all communities have the ability to take advantage of the density and the ‘just add water’ community that this provides.

Resort facilities at Abian Brisbane by Sunland – we are the Building Manager and concierge at this stunning development

Multi-purpose common room at Pier on Waterfront by Mirvac

We are about to settle on some new developments in the Newcastle region and as part of this, are planning the events we will be undertaking with the residents. In addition to this, we will be suggesting a program of activities to the strata committee that they should consider throughout the year.

These are some of the things we are thinking about doing – in Newcastle we are blessed with generous shared spaces at buildings that lend themselves to these types of activity):

Street parties with surrounding buildings – food vans, music, etc.
BBQs (doesn’t get easier or simpler)
Gardening/plants in smaller spaces and common areas with a horticulturalist
Cooking demonstrations (just need to get Harris Farm to sponsor this one!)
Fitness/yoga/pilates classes
Smart home technology class (HVAC, lighting, etc)
Caring for animals in smaller spaces
Wine tasting with a local winemaker
P0p-up cinema
Markets
Recycling and waste class

The tennis court and playground (pool in the background) at Eagle Reach Highland Park in the Hunter Valley – amazing resort facilities.

Here are some great articles I have read on the topic:

https://www.domain.com.au/news/a-place-to-call-home-placemaking-is-all-the-rage-in-apartment-developments-20160721-gqalb4/

https://urbis.com.au/insights-news/global-trends-in-mixed-use-development-the-new-paradigm-in-urban-placemaking-2/

The Initial Period

This is a guide I recently produced for distribution to developers as to who does what during the period post registration until 1/3 of lots are transferred.

Initial period

Section 4 of the Strata Schemes Management Act 2015 provides the following definition:

“Initial period” of an owners corporation of a strata scheme means the period:

(a) commencing on the day the owners corporation is constituted, and

(b) ending on the day there are owners of lots in the strata scheme (other than the original owner) the sum of whose unit entitlements is at least one-third of the aggregate unit entitlement.

Restrictions during the initial period

Section 26 of the Strata Schemes Management Act 2015 outlines various actions which are not permitted during the initial period. The actions relevant to NSW LRS include but may not be limited to the following:

Strata plan of subdivision which includes common property or creates common property.
Conversion of a lot to common property.
Transfer or lease of part of the common property.
Creation of an easement burdening common property.
Release of an easement benefiting common property.
Dedicating part of common property as a public road, public reserve or drainage reserve.
Change of by-laws. Section 140 Strata Schemes Management Act 2015 places restrictions on the making, amendment or repeal of by-laws during the initial period.

If a document is lodged at NSW LRS which intends to perform one of the above actions it must be accompanied by a certificate from the owners corporation in Approved Form 10 (PDF 7.9 KB) unless the common property title contains a note in the second schedule that a certificate has been lodged previously.

Note – the developer can stay in an undertaking for any period, however we note that this is generally not beneficial if they have sold more than 25% of lots and maintenance has properly commenced. We note also that once 1/3 of lots are disposed of the First AGM must be called and at that meeting, levies are considered.

Item	Developer Responsibilities	Strata Manager Responsibilities
Access Devices for owners	Supply swipes/keys/garage remotes. Confirm details for original contractors	Arrange process for additional devices to be obtained
Access Devices for contractors / OC	Supply all relevant service keys and access	Arrange collection and handover
Key box	Help designate an appropriate area	Arrange installation and placing of keys
Cleaning / Gardening (soft services)	Meet costs until levies are struck	Arrange quotes/start dates and administer invoicing in relation to levy start dates
Common utilities – water /gas/electricity / fire panel/lift line	Meet costs until levies are struck	Arrange handover/change of address for service of invoices to owners corporation c/- strata manager and arrange billing to developer or payment as required
Application by owners	Developer	Take and review application (e.g. pets) – provide relevant application forms to owner. Ensure items can be considered during the initial period
Insurance	Pay for insurance policy (refunded by purchasers on settlement)	Arrange quotes via broker prior to registration place insurance as directed managed any claims as required
S184 certificates	Attend IGM. Appoint OC representative for the time until FAGM. Arrange payment (otherwise ordered as required)	Provide certificates within 48-72 hours of receiving all required docs (COC, IGM mins, by-laws, SP, CT, solicitor details)
General Correspondence		Managed by the strata manager
Defect Process and Rectification (internal to a lot)	Convey defect process to owners and ensure defects rectified in a timely manner. Attend to any urgent defects immediately (habitability/consequential damage issues)	Strata manager can have a hand in reviewing to ensure whether a defect and then providing to builder/developer – assist in drafting defect process for owners (if required)Ensure defect process is notified to others aside from owners
Defects – external common property	As above	Review any issues as reported. Arrange walkthrough and recording of any common area issues
Waste management/bins	Provide relevant plan from DA, arrange a meeting with the council, order bins	Attend council meeting, ensure bins onsite in time for resident moves
By-law management (e.g. parking)	n/a	Attend to any by-law breaches as reported
Moving plan	Review and take advice as to suitable moving plan	Administrate moving bookings as required.
Welcome Pack – owners	Draft welcome pack for owners, including all relevant contact details, connection details, defect management, etc.)	Review welcome pack issued by the developer
Welcome pack – residents		Draft resident specific welcome pack if required
Metering (electricity/gas) and NBN identifiers	Advise strata manager of all relevant metering details. Assist in ensuring that metering details are picked up by authorities	Maintain a list of meters and NBN IDs for occupier assistance as required
Handover – documents, plans, IMS, schedule of finishes	Ensure any necessary documentation made available to strata manager ASAP (e.g. subcontractors for emergencies). Hand over all relevant material prior to First AGM	Give notice of requirements. Administrate handover/checklist – declares received documents at FAGM

Defibs in strata and community schemes – the facts

Defibrillators (or ‘defibs’ for short) are a hot topic right now – deservedly so as having one close at hand can mean the difference between life and death.

We recently had the pleasure of a visit from Guy Leech who now spends his working life as a defib ambassador (Founder & CEO) for Heart 180, one of the worlds leading suppliers of defibs.

Defibs have started to become common in larger strata and community schemes (particularly in pool/gym areas), however, we believe they should be common at any size scheme because of the concentration of residents and the absolute difference they can make in the event that someone has a Sudden Cardiac Arrest (SCA).

As we get further into the needs and wants of those living in strata and community schemes, we see health and safety as one of the paramount (but passive) issues for residents. Defibs have a very important role to play in the area of health and safety and we’ll be spending a lot of time in 2020 and beyond talking to building owners and developers about the benefits of having these onsite.

We are all about smarter buildings and this is the key to making ‘heart smart’ buildings.

The following is a fact sheet that we prepared with the guys at Heart 180.

Sudden Cardiac Arrest is the leading cause of death in Australia. Having an accessible Defibrillator in your building can make the difference.

A Sudden Cardiac Arrest (SCA) is a condition that occurs when the heart unexpectedly stops pumping. Each year, SCA strikes approximately 30,000 Australians.

Unfortunately, only around 6% survive, often because help cannot reach them in time. The average ambulance response time is between 9-14 minutes. SCA is not gender or age-specific!

Without defibrillation, for every minute that passes, the chance of survival is reduced by approx 10%. Application of pads on patient within 180 seconds increase the survival rate to over 70%. With good CPR & a defibrillator up to approx 90% survival rate.

We are in an increasingly cautious world and one of the protections that can be provided to residents is an accessible defibrillator located in key common areas, that they are able to access in the event that someone is having a cardio event, giving them a chance at survival.

What are they	Defibrillation is a technique used in emergency medicine to terminate ventricular fibrillation or pulseless ventricular tachycardia. It uses an electrical shock to reset the electrical state of the heart so that it may beat to a rhythm controlled by its own natural pacemaker cells. A defibrillator is a commonly used medical device which can deliver this shock. A defibrillator delivers a set amount of electrical shock to the heart after it analyses the heart rhythm. It determines whether a shock is required to the heart via adhesive electrode pads attached to the person’s chest. The shock delivered by a defibrillator interrupts the chaotic rhythm of the heart and gives the heart the chance to return to its normal rhythm.
The Devices	The common defibrillator is highly advanced and will guide the user through the process. A device cannot be used on people without a cardiac issue. The Heartsine samaritan PAD 500P AED (Automated External Defibrillator) with integrated CPR Advisor meets the needs of two key links in the chain of survival. Not only can the SAM 500P deliver a lifesaving shock, it provides real-time visual and verbal feedback to the rescuer on the force and rate of CPR compressions during an SCA resuscitation – effectively assisting the rescuer to perform CPR. Defibrillator’s assess the status of a person’s heart and will not shock a normal heartbeat.
Training for using defibrillators	Anyone can use a defibrillator – it is just a matter of following the voice prompts provided by the unit. However, training is recommended to give the user greater confidence. Heart180 provide an online CPR & Defib course or can arrange face to face training.
Where they should be installed at a building	Defibrillators should be able to be accessed by a rescuer within 180 seconds of a person having a SCA anywhere in the building. This means locating devices as close as possible for quick access by all units – if not every floor, in ground floor/lobbies, recreation areas and possibly lifts.
Maintenance	Minimal maintenance required – will need to be serviced if discharged, however the devices have an 8-year warranted life span with a battery replacement at Year 4.
Liability	Specifically mandated that training is not required. No liability attached to misuse of devices. Held less liable than if administering first aid to someone, given verbal consent is required. Civil Liability Act 2002 No 22: https://www.legislation.nsw.gov.au/#/view/act/2002/22/part8 ANZCOR Guideline 7 – Automated External Defibrillation in Basic Life Support: https://secureservercdn.net/184.168.47.225/777.066.myftpupload.com/download/section_7/anzcor-guideline-7-aed-jan16.pdf

If you have a SCA in Australia outside of hospital – the survival rate is around 6%.

If you have a SCA in Seattle (US) outside of hospital where defibrillator use is common – the survival rate is around 64%.

Parkrun Australia (Case Study)

Parkrun organise free, weekly, 5km timed runs around the world. They are open to everyone, free, and are safe and easy to take part in. Heart180 have supplied 225 defibrillators over an 18-month period to Parkrun Australia.

The first save at a Parkrun in Australia occurred 3 months after Heart180 began supplying defibrillators.

Please find more information at the following link on Brett Orpwood’s survival story: https://heart180.com.au/a-shocking-lifesaver-as-brett-enjoys-his-second-run-of-luck/

If you want to no more about defibs – get in touch with Paul Dineen.

Phone: 0447 772 300
paul@360healthcare.com.au

Cleaning strata buildings and community schemes – you pay for what you get?

Proper cleaning of strata buildings is all-important to presentation and in turn, value (you don’t show a dirty house when you have it on the market, and buildings/communities invariably always have property on the market for sale/rent) – poorly maintained common areas that you can see, can well mean poorly maintained areas you can’t see (roofs, plant/equipment, etc).

Whilst having an all-important role to play in the value of a building, cleaning is also one of the lowliest paid professions and it can be hard to tie those performing the duties (who are often transient, casual workers) to the outcomes of the building and the organisation they work for.

Furthermore, many cleaning companies practice wage theft (which there have been recently publicised crackdowns on). I have heard of some cleaners being paid as little as $15 an hour (close to half the minimum wage). There is a common practice of sub-contracting in the cleaning industry where in some cases the cleaning contract is sub-contracted multiple times over and whilst a cleaner might cost $50 per hour they are seeing less than $20 of this. This practice is abhorrent and must cease.

Strata and Community schemes which don’t make relevant inquiries to ensure the cleaning companies they use are paying award wages are complicit in the above practices.

We use a handful of cleaning companies in Newcastle and the wider Hunter region to clean the schemes we manage and we are happy to recommend them as we know as they:

pay at least minimum wage;
supervise, encourage and properly train their staff;
ensure their staff wear uniforms (so residents have some assurance that someone new onsite works for the cleaning company they employ);
use commercial-grade cleaning products;
respond quickly to issues raised by building managers, ourselves and the committee; and
offer a range of additional cleaning services, such as pressure washing and window cleaning.

I spoke with David Kent of Skyline Contracting to get an understanding of what goes into an hourly cleaning cost and he gave me the following information:

“We charge $55 an hour and a breakup is below:
• $26.03/hour for a Casual Cleaning Employee (Casual is very common in this industry);
• Super is $2.47 per hour;
• Cleaning Long Service Leave (Special Government program to ensure cleaners get LSL because the trend is cleaners change companies regularly and never have the opportunity to earn LSL) is mandatory and needs to be put away at 1.7% of all ordinary earnings ($0.44 per hour);
• Workers Compensation Insurance & Public Liability Costs (difficult to calculate per hour but we pay $15-16K per year.);
• As part of this price we cover all chemical costs required to perform all our normal duties. Depending on the chemicals required for the job sometimes we could consume one $10 bottle of chemicals across a month. Or we could use a $60 bottle of chemical across 2 shifts;
• In our pricing, we supply all the necessary equipment to complete the job. We also spend money on a regular basis to retag equipment, clean filters, replace certain parts and service our petrol-powered equipment to ensure our equipment is reliable, safe to use and won’t let us down while providing a service to our clients;
• This applies to our fleet of vehicles, we need to ensure safety by maintaining our vehicles and making sure we can arrive at jobs promptly. The above price covers all our travel expenses;
• Under our employment is our Cleaning Manager. They are responsible for ensuring our team of cleaners are always trying to do the best job they can and always trying to improve. They are responsible for Never-Ending Education & Training, Maintaining Team Morale, Speaking with our Customers, Empowering our Staff as well as looking for ways to grow our team.
• We pay for some awesome software to efficiently track our clients needs, our workloads and make it easier for the team to provide awesome service – $310.00/month;
• Premises to run our team from for office staff, storage of chemicals/consumables and to safely store our equipment/vehicles/trailers. A conveniently located workshop where we can all meet at the start of the day, liaise with each other, pack any extra equipment/chemicals we need for the day and somewhere to maintain our equipment.
• Marketing….
• We want to have enough left in our budget that if we need to stay a little longer to leave the place looking fabulous we don’t need to rush off and we can ensure our clients will be happy after every visit.
• Then, of course, leave some money to remain profitable“

Until we have robots cleaning the buildings we manage, we will continue to seek out the best in the cleaning business – ethical companies that treat their staff fairly and apply the same level of client care that we do.

I separately spoke with Kaleb Paten at Pacific Maintenance Group about their approach to the cleaning business:

“As innovation and technology become more common and essential in all aspects of building management it’s imperative that buildings select a company that is focussed on providing the highest standards of cleaning.

Buildings often have daily cleaning requirements (or require attendance multiple times per week) and as such, the cleaners are the eyes and ears on the ground to relay important information back to the strata/building manager and the committee so that any issues may be attended to promptly (this isn’t just left to residents).

It is the ongoing theme that ‘cleaning will be automated by bots’ and yes, some areas of cleaning will be completely outsourced to robotic technologies. We saw this technology at the 2019 ISSA cleaning expo in Melbourne and this seems the best solution for open space cleaning (e.g. shopping centres).

We believe that the cleaning of strata buildings and community schemes will largely continue to be undertaken by humans who can clean to the highest level and effectively communicate outcomes to their business and the community.

In a business where there are so many moving components, changes to scope are frequent and it pays to have a well-spoken, well-trained professional onsite who will be able to perceive and help generate the best outcomes for the community.

For this Industry to further grow and make progress, there needs to be a transparent and humane approach to improvement.

Companies undercutting other competitors and making a profit ONLY by bringing in illegal labour will be the first exposed, it’s approaching 2020 and modern slavery is unacceptable, these companies will be the first to go as the consumer market seeks transparency and exposes malpractice.

As consumers, it’s key that we understand who will be the persons undertaking the work we are asking the cleaning company to perform and the conditions under which they work.

Progress comes from collaboration, let’s get rid of the companies who exploit people, let’s have open communication with clients and suppliers and let’s be open with pricing and educate on why costs are what they are.”

It was great to get collaboration from both David and Kaleb on this blog, which is an effort to help educate our clients and the wider market to understand the potential differences between what they are paying for and what they are receiving.

The convergence of strata and facilities management is coming

Any strata building is complex. In a single day, there might be a range of issues requiring the input of professional managers and specialist contractors.

The average size of strata schemes has increased dramatically in recent years; whilst 40 lot buildings used to be considered large strata schemes (and contain c. 80-100 residents), it’s now common to see 300+ lot strata buildings, with potentially over 600-800 residents. This isn’t only a Sydney/Melbourne metro phenomenon – it’s an urbanisation issue impacting Brisbane, the Gold Coast, Newcastle, Canberra, Adelaide, etc.

This has changed the landscape for strata and facility management and there are constant calls for higher skill levels than were once required. These communities are complex, have massive budgets and the skills, software and contractors required to manage them are comparable to that required for very large commercial buildings. This is also a time of machine learning and soon we will (hopefully) say goodbye to repetitive/mundane administrative tasks which pain the strata and facility managers of today.

Additionally, strata committees used to be able to do a lot of legwork at a building and it was common to see them made up with people who had time, rather than specific skills. Successful strata committees of today are made up of experienced professionals who have owned in multiple buildings, are experienced and knowledgeable about their obligations and functions in sitting on a committee and know the benefit of solid independent management and advice.

It’s now more common for smaller buildings to have the input of both a strata manager and building manager, as these buildings understand the benefit of an onsite professional and their input in the context of the complex facility which the owners are expected to manage.

The strata manager of the future is a relationship manager and master administrator supported by a well-resourced, technologically abled and specialised head office – they understand that they need to help buildings make good decisions and they arm them with the appropriate information to do so and they ensure transparency, accountability, compliance and process. They are great at communication by myriad means, cost planning and running meetings.

As noted, many of the traditional strata functions are becoming automated, however the role of the strata manager is expanding and diverging into that of the facility manager.

Strata companies with FM capabilities are ahead of the curve, as they understand and have close involvement in:

asset maintenance/management. Compiling asset registers, advising on and arranging routine preventative maintenance.
Community building
Sustainability and energy/water management
Emergency planning and relief/management
Prompt communication with occupants by different means
Focus on building security
Can assist with economies of scale
Defect management
Development advisory – how will people live in the asset?
Ensuring contractors have undertaken work correctly, assessing the payment of invoices
Remote access and management

Ultimately, strata and facility management (in both strata and community schemes) will converge, with most full-service strata companies having an inhouse facilities management business to truly support the strata living experience and expectations of today’s occupiers.

The strata management company of tomorrow (that wants to manage the communities of tomorrow) is well versed in facilities management, with the inhouse skills to manage the building fabric and the ever changing needs of its occupants.

Is it time to consider a flatline management structure for your committee?

As of 2018, there was 316k strata and community schemes in Australia – that means at least 316k people sitting on strata committees (granted some may sit on many, however, some buildings have up to 9 members).

Conservatively, let’s say that there are 500k people sitting on voluntary strata and executive committees across Australia – dare I say, this would have to be the quickest growing membership of any type of voluntary committee, Australia-wide.

In my time as a strata manager, I have worked with high performing committees and low performing committees. There’s no formula to what creates a good committee for a scheme and often a scheme will need to go through pain for good people to come out of the woodwork and jump on a committee.

A committee should:

spend money, not penny-pinch;
try and be as efficient as possible and respect peoples time;
defer to experts as required;
have a basic knowledge of the Act/s under which they operate;
make sure they have liability insurance;
communicate openly with owners and occupants; and
meet relatively often and deal with decisions at properly convened meetings

These hundreds of thousands of strata and executive committee members:

are unpaid (generally);
don’t know each other well;
often have disparate interests;
share little in common other than ownership of a strata or community title lot;
may have a lot of time on their hands or little time;
may have experience in being on professional committees or it may be their first experience; or
might want the best for their community or might be there for only personal interests or a vendetta

There’s no easy way to address the above issues – I believe that committees are getting better as they now have more experience and better access to information. However, I believe that all committees would benefit from considering a flatline management structure (which works incredibly well in business and high-performance voluntary organisations like sporting clubs).

We have prepared a brief overview of a flatline management structure for schemes we manage to consider, which could work for your own. Committees should be the realm of those interested, with the requisite skills to push issues in the right direction, who defer to experts rather than ignoring them and who sponsor each member’s interests, skills and passion rather than operate by the ‘many chefs in the kitchen’ mentality.

Strata-Committee-flatline-management-structure Download

Strata Solar – is now the time?

Solar is fast becoming the in-demand sustainability and energy efficiency initiative for strata buildings in the Hunter region.

Once a building has considered and undertaken ‘low hanging fruit’ efficiency upgrades to lighting, HVAC, etc. – solar is generally the next pillar for consideration.

We all know that the climate in the Hunter region is fantastic year-round, with (300) sunny days per year; this, in turn, makes for fantastic solar energy production.

We have helped arrange the installation of solar at a number of buildings we manage and we’ve had fantastic support from the owners and results for the owners corporation in doing so.

Strata buildings in the Hunter, Lake Macquarie, and Newcastle region have features that lend themselves well to the installation of solar:

Flat roofs without plant and equipment, on buildings with a relatively large footprint (there are not many towers in the area like you find in Sydney metro areas);
limited over-shading from other buildings (e.g. commercial buildings like you get in many parts of Sydney) and trees;
Relatively limited demands on common property power – lighting, garage doors, lifts, HVAC – thus a rooftop solar system is generally able to offset this completely;
Payback periods as short as 4-5 years based on current power charges – this will shorten again if rates continue to rise (which they likely will with the closure of power plants);
The indicative lifespan of solar systems of c. 25 years, with very little maintenance;
Ability to reduce demand on the grid, which can be stressed during summer when people are running air-conditioning and other appliances; and
A greater focus on cleaner/smarter energy than there’s ever been.

The process for getting solar on your building is relatively simple:

Strata Committee arranges for assessment by a solar installer (make sure you find one that has done strata work previously). There may need to upgrade to the electrical board and wiring to allow for solar;
Provided the building is suitable (some are not due to the shape of the roof, over-shading, plant and equipment on the roof or the orientation of the roof), competitive quotes are sought based on a suitably sized system for the building.
We suggest having an independent third party such as Sustainability Now or Wattblock (here’s a great white paper that WattBlock did on solar – certainly more informative than this particular blog) – tender the work and give a recommendation (there are so many types of panels and inverters and you want to ensure what you are getting is suitable);
Work out how the system will be funded – special levy or out of existing funds (what has worked well at other buildings is using capital funds to purchase the system and then allocating additional funding in future years to repay the system cost from the savings in electricity in the administrative fund);
Put relevant motions to a general meeting for funding and the addition of solar to common property; and
Once agreed by the meeting, proceed with the work and start experiencing the amazing cost benefits of solar.

Committees and managers should ensure that the solar system is monitored so that you know it’s producing power. There’s nothing worse than having an expensive solar system on your roof which has tripped and nobody is any the wiser. There are now SIM solutions for this at a minimal cost and an alert goes to the strata/building manager/retailer or committee if the system isn’t operating as it should.

There are also some alternate models out there involving leasing the solar equipment and the lessee being able to provide occupants clean power at a discount.

Battery storage technology is getting better year-on-year as well, so there’s every prospect of mating battery with solar to ensure that a building will only draw power from the grid in off-peak periods.

It’s also noted that strata schemes made up of townhouses can likely obtain all the benefits of solar on a per-lot basis (or potentially group together for the installation of a larger system with battery technology – there’s every opportunity for an off-grid development in the Hunter of this type in years to come).

At Bright & Duggan and Cambridge Management Services, we would be happy to have a chat with anyone about the process and the benefits.