Q. How do I pitch my agency and myself if I don’t have any experience in strata management?
A. Just as you sell your sales and property management services, it’s important to emphasise your property knowledge and experience. A feature of your services is that your strata clients have access to their records via an industry-leading and award-winning portal that offers committee members and owners 24/7 access to their strata documents, minutes, work orders and financials. In addition, prior to commencement you will be trained and be able to refer to our internationally acclaimed training platform. Plus you will have access to our live support staff for any difficult question.
Q. What should I charge as a standard management fee?
A. What you charge is your business. Just as with agency commissions on property sales and management, these are governed by how you sell your services and the market in which you compete. We can provide industry averages but recommend you research your local competitors. Our marketing site has a calculator that allows you to compare a competitor’s fees and charges so as to ensure an ‘apple for apple’ comparison is undertaken. Some strata body corporate managers have high disbursements with low basic management fees, or vice versa. It is important to be able to advise the prospective building as to the real cost of the incumbent managers versus your offering.
Q. How do I win a strata for the first time?
A. One approach is to identify units in buildings that you currently manage and you already have a relationship with the owner. By approaching the owner you know you can determine whether the current owners are satisfied with the performance of the incumbent manager and then offer your services. Enlist this owner’s help to meet with committee members and other owners and sell your services, including your secure online portal to access their documents and records. This will result in an extraordinary general meeting (EGM), at which a resolution can be moved to replace the incumbent and hire you.
Another significant area in which to market is new developments. Here you can now offer a complete suite of services to a developer – making you the one-stop shop for strata, sales and property management. By approaching the developer early in the build you can advise on the creation of the scheme and adjust the plans to aid the developer and all future owners with regard to by-laws and common area allocation (to name just a few).
Q. How do I win a strata when a developer is involved?
A. Our training site provides a guide to winning a new development. The process is very similar to the work you do already – build a relationship with a developer, offer your complete service (strata, sales and property management), advise on the building set-up and hold the required meetings. Initially you are appointed by the developer, and finally at the first meeting of the owners, you are appointed by the owners.
Q. Is there a strata management agreement we have to use?
A. There are strata management agreements available from the industry body and you are welcome to use a template OutSourced Strata uses as a guide. It’s important that you use due diligence in creating a document that is relevant to your market and your competitive environment. It might be a good idea to review your local strata competitors and seek legal advice. We can provide example agency agreements that you can customise.
Q. Do you take a share of the listings and property managements?
A. No. However, any property sales or property managements that result from adding strata management to your business are 100% yours. You manage them using your own systems as you do now.
Q. Will I have to employ someone to do the back-end admin work?
A. First, you need to evaluate what the initial workload will be. If your target is to win 10 new strata buildings in your first year, then that’s 10 AGMs a year and any repairs and maintenance for the common areas. Typically, research suggests the average Queensland full-time strata manager looks after 47 buildings – an average of 700 units. OutSourced Strata managers using our back office and technology system manage up to 80 buildings or about 1000 units and still have time to be proactive. Therefore 10 buildings should require just over 10% of one manager’s time.
However, your initial workload will be winning new strata body corporate business. The resource you need is a person capable of calling unit owners whose property you already manage to convince them to assist you to meet with the committee so you can pitch your strata services. That person will also need to attend an extraordinary general meeting (EGM) to present why your agency should replace the incumbent. Typically the incumbent will have three months to hand over the records, after which your agency commences work as their strata manager. OutSourced Strata will receive these records and load the building for you.
Second, the requirement is for someone to service the new client. This includes attending AGMs and other committee meetings as well as repairs and maintenance. This will be similar to managing one new property management but without the administrative paperwork.
Q. What does my strata manager have to do?
A. There are two core competencies required: (1) Winning strata buildings over to your agency; and (2) Managing meetings and repairs and maintenance. Initially the person assigned to this role will spend the first three months (typical period of termination to replace the incumbent) winning buildings and then once appointed they will need to manage meetings as well as repairs and maintenance. Managing one strata building with an average number of lots would mean 2% of their time would be managing, and 98% of their time would be winning more buildings. Managing 10 buildings would equate to 12% of their time managing and 88% spent winning further schemes.
Q. What type of person is best?
A. Again, this is your business, and adding team members who are compatible with you and your team’s work culture will be unique to your organisation. However, we and others in your situation have found applicants without previous strata experience but a competency in building client relationships are very effective in this role – selling services, presenting to groups and managing needs and expectations of a number of clients. Older employees can also have a more authoritative and respected presence with owners at strata meetings.
Each building you win offers an average of 16 new owners and as many as 30 to 80 in some circumstances for potential sales listings and property management opportunities. A target of 10 buildings in a year represents on average 160 and potentially many more new property owners to service their sales and property management needs.
Q. Won’t there be a conflict with an on-site manager?
A. With a body corporate or strata building there can be at least three and often four distinct roles in property management. These are: (1) Sales; (2) Property management; (3) Strata management; and (4) On-site management.
Some service providers will offer one or two of these services. Your agency will already provide sales and property management and now hopefully strata management. On-site managers of course already see you as a competitor for some of these services such as property management. On-site managers rarely offer strata management or on-site sales even though they are normally contracted to do repairs and maintenance. While they will not be happy with you expanding your services to ‘their building’, you would only be appointed by the owners if they feel the on-site manager and/or incumbent strata manager is not doing a good job.
However, your increased presence in the building can be sold to the on-site manager as an advantage to them in that if you are the prominent property manager in the building and the strata manager they will only have to deal with you and not multiple agents. Some agents offer a small percentage of any sales commissions within the building to help strengthen the relationship with the on-site manager.
Q. Do I get an exclusive territory or zone?
A. You are not restricted. Just as you are not restricted as a Queensland Real Estate agent from managing properties or selling properties you are not restricted in selling your strata management services either.
Q. If I terminate my agreement with OutSourced Strata by SRES, what happens with the strata portfolio?
A. It is yours to operate or sell at any time.
Q. What if I do not have trained and experienced strata managers on staff?
A. We provide online training for your staff and then support you with expert advice. A complete program is provided so your staff members become competent strata managers. Your property management staff are more than capable.