Business plan

What are strata management companies and what do they do?

The Strata Property Act, which regulates strata corporations, imposes numerous obligations on them, including the maintenance and repair of common property, the presentation of an annual budget, the collection of strata fees, the acquisition of insurance, the maintenance of certain records and documents, and the enforcement of the bylaws of the corporation. An elected strata council is required to carry out these responsibilities.

For many volunteers on a strata council, knowing what responsibilities to undertake and how they should be performed can be a challenging and perplexing undertaking. The responsibilities call for understanding of contract law, the SPA, other statutes, building upkeep, and financial and accounting concepts.

Many strata companies want to work with a firm that is authorized to offer strata management services like Sydney strata specialists so that strata councils can carry out their responsibilities as strata corporations and comply with complicated legal requirements.

The relevance of the contract that the stratum corporation engaged into for the provision of strata management services, as well as the function that a strata management business can play in helping strata councils with their tasks, should be understood by strata councils.A managing broker, who oversees the individual stratum managers and is in charge of the brokerage’s operations, is a must for every brokerage. Although a specific strata manager is typically designated to provide services to the strata corporation, the strata manager is actually acting as the brokerage when they do so.

The brokerage may designate various strata managers to the strata corporation over the length of the agreement between the strata corporation and the brokerage to provide services to the strata corporation. The brokerage will recruit additional staff, such as clerks, accountants, and other non-licensed individuals, in addition to contracting licensed individuals to perform strata management services for the strata company.

The brokerage may also organize service providers, such as plumbers, electricians, housekeepers, and landscapers, whose services are contracted by the strata corporation. In the management contract, the brokerage should detail any additional services it offers. The term strata management company will be used throughout the rest of this document to refer to a brokerage that offers strata management services.When a management agreement is signed, the strata corporation, which is a distinct legal organization, is the party doing the signing. The strata council is acting on behalf of the strata corporation and its owners even though it has the authority to negotiate and sign the contract.

Subject to any limitations set by the bylaws, the strata council, acting on behalf of the strata corporation, may decide to delegate to the strata management firm many of the tasks that belong to the strata corporation. Alternately, the strata council can decide that the strata management business should simply handle a select few tasks, such collecting strata fees, paying bills, and creating financial reports.

The choice of a strata management business is made by the strata council unless the owners have specifically instructed the strata council in this regard, even if the owners must approve the payment of the management fees in order to enter into a contract with a strata management company.

Blane Sanchez
the authorBlane Sanchez