Last calendar year we welcomed over 1000 new owners to our Body Corporate (BC), Cross lease (CL) and Residents Society (RS) portfolio of properties under management. Around half were new owners purchasing into existing buildings that we already manage, and the other half were new owners in buildings we previously didn’t manage.

This month we go back to basics and provide a guideline for all our new (and existing) BC clients.

What is a Body Corporate?

A Body Corporate is a legal entity formed to manage and maintain the shared/common areas of a building or complex in a unit title development i.e. driveways, hallways, lifts, gardens, building envelopes/roof etc.  A Body Corporate is governed by the Unit Titles Act 2010 which sets out the rights and responsibilities of the Body Corporate and the unit title owner.

Who is the Body Corporate?

The members of the body corporate are the owners of the units/apartments in the development. An owner of a unit/apartment also owns a share of the common property. Each owner automatically becomes a member of the body corporate when they purchase a unit within the development. Third party service providers like BC Managers or Building Managers are not the Body Corporate.

What happens at an Annual General Meeting (AGM)?

This is a compulsory annual meeting and key to discussing important issues and making decisions. Some important items on the AGM agenda include reviewing the previous year’s financials and approving the budget for the year ahead, raising levies, reviewing insurance policies, appointing or reappointing BC Managers and Building Managers as well as electing the committee representatives and Chairperson for the year ahead.

What does the Body Corporate Chairperson and Committee do?

The Unit Titles Act allows specific powers and duties of the Body Corporate and the Body Corporate Chairperson to be delegated to a Body Corporate Committee. The Chairperson’s role includes duties such as preparing the agenda and running meetings, taking minutes, keeping financial records, signing documents and maintaining the owners register to name a few. These tasks are generally undertaken by an appointed Body Corporate Manager who works with the Chairperson and Committee to ensure the smooth running of the Body Corporate throughout the year, with all reporting back to the Body Corporate at the next AGM.

How are my levies calculated?

Either by an Ownership Interest (OI) mechanism or a Utility Interest (UI) mechanism. Basically, OI is calculated on a unit’s share of the value of the whole complex whereas UI is calculated on both your unit’s share of the value of the whole complex plus your use of it. These are calculated by a valuer when the BC is created and don’t change unless by special resolution (75% of owners who are entitled to vote at the meeting) at an AGM or EGM.

What are my levies made up of?

Body Corporate levies are the regular fees that owners in a unit title development pay to cover the costs of managing, maintaining, and insuring the shared property. These levies can vary depending on the size and complexity of the development, but they generally cover the following key areas: Maintenance & Repairs, Insurance, Administration/Management costs, Utilities, Legal Fees.

The amount you pay may vary from year to year depending on the body corporate’s annual budget, which is discussed and voted on at the AGM. The body corporate committee will review expenses, make adjustments if needed, and ensure that levies are sufficient to cover all costs.

What does the Body Corporate Manager do?

They are responsible for the general smooth running of the Body Corporate. Tasks include organising the Annual General Meeting and sending out minutes, record keeping, handling money on behalf of the Body Corporate and its members, arranging insurance, liaising with contractors on works required to meet the BC’s legal obligations e.g. annual WOF, organising emergency repairs, raising and collecting levies, liaising with owners on any issues that arise, collaborating with the Committee, Budgeting and Financial assistance and day to day correspondence with BC members and service providers to the BC.

What does a Building Manager do?

The main responsibility of a Building Manager (BM) is the upkeep and maintenance of the common property of the asset. This includes implementing the BC’s Health and Safety procedures when contractors are coming to site, arranging quotes for Committee approval, ensuring that annual compliance inspections and paperwork are carried out, managing security systems and access systems along with managing day to day issues that arise from tenants and residents.

This is the first article in our ‘Back to Basics’ series. Look out in the coming months for the next one.

At apm, we pride ourselves in the commitment, capability, knowledge and experience of our team members. If you are after a Bodies Corporate Manager that’s relationship focused, gets results, and thinks ahead to reduce risks, then chat to our Body Corporate team today.