Migrating to managing agent from residents’ management Co?

Migrating to managing agent from residents’ management Co?

9:22 AM, 12th April 2023, About 2 years ago 34

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Hello, We are a small block of 7 flats with a mix of owner occupiers and owners who let their flat. Approx 22 years ago we set up a Ltd company and jointly purchased the freehold so that each flat owner has 1 share in the company.

Since purchasing the freehold, I have been an owner occupier and director of the management company, together with 1 other director and a company secretary.

The company secretary has recently put her flat on the market and given notice that she has found a buyer and so is resigning her position.

We have always taken the view that a minimum of three active directors are required on the basis that if at any time there are only two, an unexpected change of circumstance could leave one person responsible for all of the duties of the management company. The other flat owners have never been prepared to, or not been capable of, being actively involved in the management company.

Having discussed the situation with the other remaining director, neither of us is keen to become the last man standing and after 22 years of service, both of us have different reasons to want to free ourselves of what is becoming an onerous obligation.

We have therefore decided to start exploring local companies who provide block management services with a view to outsourcing as much of the obligations as is possible. Clearly, there will be a cost to be borne as other owners will likely have little appreciation of how much money our voluntary efforts have saved them over those years.

We have contacted all owners to explain what we are proposing and why, in an effort to open up a discussion and to take views. Disappointingly so far, after a reasonable wait, nobody has responded at all.

The ideal scenario would be for everyone to really understand and support the proposal, and the worst case would be owners objecting in principle but without offering any useful alternative suggestions.

I’m wondering what action we should take if some, or all, of the 5 non-contributing owners won’t support us but won’t or can’t step up to the plate.

Another consideration is what would happen with regard to the freehold if we, as the last two remaining directors of the management company, both resigned closed down the Ltd company, replacing it instead with an informal Resident’s Management Company?

Thank you,

Rich


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Mervin SX

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18:55 PM, 15th April 2023, About A year ago

Reply to the comment left by Crossed_Swords at 15/04/2023 - 10:59
The articles of association can be amended, with the permission of all the leaseholders (on a majority vote).

My block management company operates in Norfolk, Suffolk, Essex and West London. But we help with Right to Manage and Collective Enfranchisement for buildings located anywhere in England (not Wales or Scotland).

Crossed_Swords

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8:53 AM, 17th April 2023, About A year ago

Reply to the comment left by Mervin SX at 15/04/2023 - 18:55
Thank you, Mervin. Yes indeed they can, but it needs to be 75% not a simple majority meaning only one may dissent in this instance for it to be carried. One would hope that unless they want to step up themselves they would vote for it

Unfortunately you are not in the area I am thinking of

RichM

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20:46 PM, 2nd May 2023, About A year ago

Once again thanks for all your replies. I've read through them all again to re-note the nuggets of valuable information.
Having recently had an informal discussion with a local MA we are resolved to proceed with seeking quotations for outsourcing the block management.
I have experience from my work life of procuring quotations for building work, including with S20 consultation, and so I know the importance of a form of enquiry which ensures that everyone is quoting on a like for like basis. It would make me happy if I could avoid having to attempt to draft something if there is already a pro forma form of enquiry in existence. Is anyone aware of such a document?

Puzzler

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7:48 AM, 3rd May 2023, About A year ago

ARMA have a document on their site - "Choosing a management agent"

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