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THE MAGAZINE FOR THE CONSTRUCTION INDUSTRY
BUILDING DESIGN &
CONSTRUCTION MARCH 2014
ISSUE 195
MARCH 2014 ISSUE 195
BUILDING
FOUNDATIONS WE TALK TO KATE MORRIS-BATES, ESTATES SERVICES PROGRAMME DIRECTOR, AND CHRIS DUNNE, CAPITAL PROJECTS MANAGER AT THE CO-OPERATIVE GROUP
PLUS DARREN BROWN, FACILITIES MANAGER AT NATIONWIDE BUILDING SOCIETY TALKS ABOUT CHANGING THEIR FM SUPPLIER
BUILDING DESIGN & CONSTRUCTION
SPOTLIGHT ON: SCOTTISH PROPERTY MANAGEMENT
GRANT & WILSON
SPEIRS GUMLEY
REDPATH BRUCE
ALSO INSIDE: ESSEX INSULATION |CURTIS MOORE | ALMEDA FACILITIES | LHC | IKEA | MILLER
RICS:feature 2 20/01/2014 15:29 Page 48
PROPERTY MANAGEMENT: RICS
INTERNATIONAL PROPERTY MEASUREMENT STANDARDS
he International Property Measurement Standards Coalition (IPMSC) has launched a public consultation on new international measurement standard and has also appointed a Board of Trustees. In January 2014 the International Property Measurement Standards Coalition (IPMSC) launched a public consultation on the new International Property Measurement Standard (IPMS) for office buildings. The three-month consultation, closing on 04 April 2014, is calling for real estate (office) sector practitioners and stakeholders to contribute to the new international standard. The new standard, produced by the IPMSC Standards Setting Committee, is the first of its kind
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and will provide a common language for measuring offices across international markets, benefiting real estate practitioners including investors, lenders, agents, valuers and occupiers. The international standard will ensure that property assets are measured in a consistent way, creating a more transparent marketplace, greater public trust, consistency in the reporting of property size, stronger investor confidence, and increased market stability. At present, the way property assets – such as homes, office buildings or shopping centres – are measured varies dramatically from one market to the next. With so many different methods of measurement in use, it makes it difficult for global investors, occupiers and tenants to accurately com-
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pare space. Research by global property firm Jones Lang LaSalle suggests that, depending on the method used, a property’s floor area measurement can deviate by as much as 24%. IPMS will be adopted by all 28 coalition organisations with firms around the world already lined up to implement IPMS from June 2014. The Dubai Government are the first government to commit to its adoption, which will underpin valuations of commercial property and financial reporting through IVS and IFRS. The new standard is considered one of the most significant developments in the real estate profession in recent history and will go beyond office measurement standardisation to include other property types, such as residential, in the coming months.
Strengthening public accountability of the IPMSC, the coalition can now announce the appointment of a Board of Trustees. Members from each of the 28 organisations are represented on the board, chaired by Ken Creighton (RICS), with Vice Chair Lisa Prats (BOMA International) and Secretary General, Jean-Yves Pirlot (CLGE). The coalition also confirms new IPMS members joining the coalition. Property Council of New Zealand (PCNZ); Asian Non-listed Real Estate Vehicles (ANREV), Assoimmobiliare, National Society of Professional Surveyors (NSPS) and Japan Association of Real Estate Agents (JAREA) have committed to the standards programme. www.rics.org/uk
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PROPERTY MANAGEMENT: BRITISH COUNCIL OF OFFICES
THE
UNTAPPED PROPERTY RESOURCE THE BRITISH COUNCIL FOR OFFICES CALLS FOR BUSINESSES TO TAKE OFF THE BLINKERS AND UNLEASH POTENTIAL FOR PROPERTY TO BENEFIT PERFORMANCE.
he British Council for Offices (BCO) has published research carried out by the Centre for Economics and Business Research (Cebr) and Populus, revealing that UK plc spent an estimated £28.5 billion on offices in 2012 – outstripping business expenditure on legal services (£24.3bn), accounting (£14bn) and insurance services (£23.8bn). Despite this, nearly three fifths (57%) of the 250 senior executives from large organisations surveyed said property issues were not regularly discussed in the boardroom and responsibility for property is still likely to fall outside management teams. The survey found signs that businesses are starting to wake up to the potential business benefits that office space can deliver but still take a very costcentric view towards the workplace. Despite the fact that almost three-quarters of organisations reported
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that they were constantly analysing and assessing whether their space is being used efficiently, cost was found to be the most important factor in assessing the office’s performance (73%). With 68% of organisations surveyed likely to review how their office space is used in response to organisation growth or investment, the BCO believes that there is a significant opportunity as economic recovery accelerates over the next few years for businesses to start to see property as having the potential to bring significant benefits to their overall performance. While staff retention and productivity were recognised to be important factors in assessing the performance of office space, those surveyed admitted to failing to look at the role of office space when productivity dropped (40%), recruitment and reten-
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tion levels fell (39%) or when staff morale fell (27%). Richard Kauntze, Chief Executive of the BCO, said: “Property is a significant expenditure to UK plc, but is typically seen as no more than that. What is often overlooked is that it is also a very small proportion of the overall cost of running most businesses when contrasted with the cost of the pay roll. “What many businesses don’t understand is that by using property efficiently, treating it as a resource to be optimised, it can deliver tangible benefits in employee performance through increased productivity and wellbeing. Businesses shouldn’t wait until costs need to be cut before reviewing their office space – it’s important that they look at how to get the most out of it like any other expenditure. This is why we believe management boards need to recognise that property merits greater attention.”
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PROPERTY MANAGEMENT: BRITISH COUNCIL OF OFFICES
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arma:feature 2 27/01/2014 13:26 Page 54
PROPERTY MANAGEMENT: THE ASSOCIATION OF RESIDENTIAL MANAGING AGENTS
OFT PROPOSALS
WELCOMED
he Association of Residential Managing Agents (ARMA) is the leading trade association for residential managing agents in England and Wales. The association promotes high standards of leasehold management and professionalism through advice, training and guidance. Recent activity includes ARMA welcoming the Office of Fair Trading’s intention to undertake a market study into residential property management which will provide the opportunity to examine the issues affecting the industry and achieve real improvement in the operation of the market for consumers. ARMA considers the top priorities for action to improve the operation of the market include awareness-raising and education to help leaseholders to become better informed consumers, and transparency where landlords and leaseholders need to be properly and fully informed about how managing agent services are provided. ARMA believes that the key to achieving these is effective regulation; this is why ARMA is in the process of introducing its own self-regulatory regime called ARMA-Q. ARMA-Q aims to raise standards and quality of leasehold management and will establish new safeguards for leaseholders. It includes commitment to a new Consumer Charter and professional Standards, which are specific to managing agents. From 2015, all ARMA members will have to meet the ARMA-Q Standards and comply with the principles set out in
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the Charter. Membership is voluntary, so any agent signed up to ARMA-Q will be showing a clear commitment to offering the best possible service. ARMA-Q is the new self-regulatory regime for ARMA members. Its aim is to protect consumers and deliver a recognised advantage to members, through professional self-regulation that guarantees probity, the highest levels of ethics and best practice in all dealings between residential managing agents, intermediaries, landlords and leaseholders. It features a consumer charter, standards which are specific to managing agents, and an independent Regulatory Panel. From 1 January 2015 all ARMA members will need to meet the new Standards and operate according to the principles contained in the Consumer Charter. Together with the requirements set out in ARMA’s Articles of Association and Bye-laws, these form the rules of ARMA membership. The ARMA-Q Standards have been written to apply to residential long leasehold properties (a lease of a term in excess of 21 years when originally granted) in England and Wales where a service charge, which varies according to the expenditure, is payable. Because Landlord and Tenant legislation does not apply to freehold houses on managed estates, the Standards do not apply to those properties. However, the principles of the Consumer Charter do still apply.
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arma.org.uk Tel: 020 7978 2607
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PROPERTY MANAGEMENT: THE ASSOCIATION OF RESIDENTIAL MANAGING AGENTS
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PROPERTY MANAGEMENT: PROPERTY MANAGEMENT ASSOCIATION SCOTLAND
THE HIGHEST STANDARDS
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THE PROPERTY MANAGERS ASSOCIATION SCOTLAND LIMITED (PMAS) IS THE LEADING ASSOCIATION REPRESENTING PROFESSIONAL PROPERTY FACTOR FIRMS IN SCOTLAND he Property Managers' Association Scotland Limited (PMAS) is the leading association representing professional Property Factor firms in Scotland. The organisation was developed to promote the highest standards and best practice within the property management industry, providing members with advice on legislature changes, arranging vocational training, seminars and hosting an annual conference. The PMAS actively engages with the Scottish Government and other agencies with regards to property law and matters relating to heritable property in Scotland. The association dates its history back to the 1800s when an organisation called the Association of House Factors and Property Agents was formed. At that time House Factors managed residential properties for the landlord owners of many tenement buildings throughout Scotland but particularly in the industrial areas such as the City of Glasgow and towns such as Paisley, Greenock and Dundee. In 1917, the association was incorporated as The Property Owners and Factors Association Glasgow Limited which was then amalgamated with the local associations in Greenock, Paisley and Dundee and became Property Managers Association Scotland Limited (PMAS) in January 1991. PMAS is a company limited by guarantee with three classes of membership; Life Members, Ordinary Members and Property Manager Members. Life and Ordinary members are individuals and comprise Partners, Directors, Associates and Principals in Property Manager firms. Property Manager Members comprise Property Management firms throughout Scotland. The association also has a class of Honorary Membership which is conferred upon former Ordinary Members who have served the association with distinction. Services incorporate the comprehensive range of requirements needed to carry out successful property management. These services generally arise where properties or developments share common facilities and amenities. Management and maintenance of multi-occupied buildings is complex with inter-linked legal and practical problems. Whether the client is an investment owner or owner-occupier, the property residential, commercial or industrial, members can expect management services and management advice tailored to suit particular needs. This also includes ensuring efficient management, dealing with the administration of the property including rent collection, instruction of repairs, allocation and collection of repair charges, and organising common property insurance cover, including collection and apportionment of premiums. Additional services involve organisations of ongoing maintenance of common parts both internal and external, arranging regular property inspections, and assisting groups of owners in forming Owners committees or Associations. The PMAS will also liaise with groups of owners, either through recognised representatives or individually, deal with correspondence, enquiries, property reports and owners complaints, and work with other professional bodies in communal issues arising from the day to day management of the property. www.pmas.org.uk Tel: 0141 248 3434
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PROPERTY MANAGEMENT: SPEIRS GUMLEY
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PROPERTY MANAGEMENT: SPEIRS GUMLEY
A passion for
PROPERTY AT SPEIRS GUMLEY PROPERTY IS A PASSION WHICH HELPS THEM DELIVER THE BEST MANAGEMENT, LETTING AND SURVEYING SERVICES AVAILABLE TODAY
ife has become a little more complicated for Speirs Gumley since being founded in 1827, albeit under a different name. Rather than simply managing rented residential tenement properties on behalf of a single landlord as it did then, it now also has properties under multiple ownership, some of which are retail units or mixed use developments. The situation has been simplified somewhat by a recent management buyout that has resulted in Lorraine MacDonald and Peter McConnell now the only remaining partners. That’s been combined with a refocusing of the business on the core activity of residential management, which accounts for 89% of turnover, together with commercial management and residential lettings. To complement these departments, the company retains a building surveying division, which has a knowledge of the buildings managed that wouldn’t be available using a third party resource. Speirs Gumley currently undertakes residential management for 24,000 units, residential lettings for 350 houses or flats and commercial management for sixty properties mainly in Glasgow, Edinburgh and across Scotland’s central belt. Commercial properties range from a single shop to the prestigious and historic Merchants’ House, a multi-tenancy property in Glasgow’s George Square, and also the Italian Centre in Glasgow, which
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comprises Italian designer stores plus cafes and restaurants. Residential properties can be anything from four flats in a converted villa to the company’s largest property that has 501 flats. Residential management means dealing with owners and occupiers while both commercial management and residential letting involves working with landlords and their tenants. Whilst the various parts of the business are different, they fit well with each other although, as Lorraine explains, the approach often has to be tempered to suit the type of property: “It’s really important to work with everybody, involving the tenants but at the same time looking after the interests of the property owner. STRIKING A BALANCE “We have a realistic approach to everything we do in propertay management. For residential property management, we may manage a development where a substantial number are having financial difficulties given the current climate so we need to distinguish between essential repairs and improvements that can be postponed. Also tenants within these properties often have higher expectations than the landlord for both residential and commercial management so we have to manage those expectations. “Everything is about striking the balance, especially given the current climate with some commercial tenants struggling
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PROPERTY MANAGEMENT: SPEIRS GUMLEY to pay rent. It’s all about communication so maintaining regular contact is vitally important to make sure we keep on top of everything we are doing affecting the owners, tenants or landlord.” Whilst these considerations don’t affect the day-to-day running of properties — the cleaning, inspections, maintenance and collection of rents where appropriate — they do influence the less regular work that’s undertaken. Planned maintenance programmes on many of the commercial properties are paid for from service charges but redecorating and renewals for residential developments require careful budgeting and advance payments. Unlike England and Wales, in Scotland residential management has a system of each resident paying a float (one-off advance payment) when moving into a property, which covers repair and maintenance costs. This float is returned to the clients final account should they sell and move on. “We bill our residential clients every quarter which, when paid, tops up the float,” explains Lorraine. “What we have to do is work within the constraints of the float and try to make sure we are not exceeding the float level. It’s similar in principle to a service charge except we are billing every quarter for the actual charge, which perhaps provides more control than an annual reconciliation. It also gives owners more clarity because every quarter they see what they are being billed for, which also means it’s easier to pick up issues in relation to contractors’ invoices.” COMMUNICATION WITH OWNERS The key to providing a good management service is communication with owners, tenants and landlords, which is something Speirs Gumley actively promotes, encouraging the formation of committees for their properties. However, the committees don’t have the overriding right to manage the properties and so, as Lorraine recounts, the company doesn’t then limit its communications to the members of the committee: “Any time we are involved in a committee, we say that we manage the property on behalf of all the owners and,
“IT’S ALL ABOUT COMMUNICATION SO MAINTAINING REGULAR CONTACT IS VITALLY IMPORTANT TO MAKE SURE WE KEEP ON TOP OF EVERYTHING WE ARE DOING AFFECTING THE OWNERS, TENANTS OR LANDLORD.” LORRAINE MACDONALD SENIOR PARTNER
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PROPERTY MANAGEMENT: SPEIRS GUMLEY although the committee has certain powers, we always suggest that we communicate with all the owners of the property. After all, it is their money we are ultimately spending on their property. “In residential property management, we will inspect all our modern properties every quarter; in between we will conduct site meetings with contractors and also meet with the owners or committees. For residential letting, we carry out inspections to the flats or houses three times per year to ensure the properties are looked after by the tenants to a high standard, a service most welcome to our clients. With commercial property, it depends on the type of property and the agreement with the owners. In other words, it is tailored to suit the requirements of those we are contracted to”. The principle is very much one of working in partnership with everyone, whether landlords, owners or tenants who are all considered equally important to the good management of the property. However, it can also complicate matters when trying to get the agreement of multiple owners/landlords and more importantly the funding. If the owners/landlords don’t live at the property, there can be less of a buy-in to proposals made.
“We are only the agents and we need the support of the owners as well as their funding,” remarks Lorraine. “We can and do recommend all sorts of energy saving proposals but we have to get the owners to support it because often there is an initial capital outlay in order to make the longer term savings. Some owners may be reluctant to spend money because they are thinking of selling so, although we may try to work some sustainability into the building, it’s not always successful. It’s all down to funding but there is no reason why it can’t happen if it’s managed properly and we get the buy-in from owners and, with our approach to this, we have had a great deal of success.” In property management, it’s really about protecting and maintaining owners’ investment, and in commercial and residential letting, maximising income and ensuring at all times that a value for
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money service is provided for all. To be able to continue in its quest to provide a good service to all, Speirs Gumley assesses every new established property where it is asked to tender for the management and tries to determine the reason for owners seeking a change of management. The process often results in recommendations being made for improvements to the management or maintenance of the properties and, if owners aren’t prepared to commit to change or invest in the property, Speirs Gumley will withdraw from the tender process. The good management of a property requires the commitment of all and an understanding of the need to maintain the property to a good standard. “An example of this is that with commercial properties we act on behalf of the landlord and, although the lease will state the landlord’s name,
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tenants won’t necessarily have the contact details so we represent the landlord and are sometimes mistaken for the landlord instead of the agent,” states Lorraine. “Ultimately, if a tenant needs to have repairs carried out but the landlord isn’t prepared to spend money, it's Speirs Gumley’s reputation that falls. For that very reason, I have withdrawn from the management of a property in the centre of Glasgow.” TRANSPARENT AND OPEN Maintaining the company’s reputation extends to engaging only reputable contractors who work in accordance with current legislation and health and safety requirements. This insistence on good standards has been backed by recent legislation in Scotland, the Property Factors Act, that has made residential property managers more accountable. Although it hasn’t achieved one intention of getting rid of rogue property managers and there is still work to be done on that front, it does vindicate Speirs Gumley’s approach. Lorraine says: “We’ve always operated in a very transparent and open manner so the changes for us weren’t as great as they were for others. However, there is now legislation and accountability, a homeowners’ housing panel and tribunal. This must have an impact on the industry and help improve the service provided to owners. Already, after just over a year in the making, there appears to have been a marked improvement.”
MAINTAINING THE COMPANY’S REPUTATION EXTENDS TO ENGAGING ONLY REPUTABLE CONTRACTORS WHO WORK IN ACCORDANCE WITH CURRENT LEGISLATION AND HEALTH AND SAFETY REQUIREMENTS Further changes are in line for the company, with Lorraine’s radical vision within the next two years to set up a profit share partnership scheme as well as a charitable organisation named the Speirs Gumley Foundation to be funded from profits. The foundation will be supported and operated by the staff to inspire them to continue to provide a great level of service for its clients while at the same time being involved in something completely different from their day to day work. The Speirs Gumley team's approach to property management is based on building trust and relationships with owners and occupiers in order to provide a first class service. The same approach will be applied to the foundation. Although there’s increasing use of social networking and electronic communications, the relationships continue to be based largely on actually speaking to people and by doing this the team plays a large part in its success.
“I am passionate about the vision of Speirs Gumley and the way I have decided this business is going,” states Lorraine. “The staff are the most important asset of any business and at Speirs Gumley we would not be the success we are today without them; that’s why I want them to share in its success. We believe we are the leaders in our industry not only with service but I.T., marketing and vision as well as our continued quest to raise the standards in the industry. We don’t sit back and watch things happen; we roll our sleeves up and make them happen. We have come through the transition of a management buy out with flying colours and the entire team is looking forward to the journey ahead and many successful and eventful years.” www.speirsgumley.com Tel: 0141 332 9225
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PROPERTY MANAGEMENT: REDPATH BRUCE PROPERTY MANAGEMENT LTD
100 YEARS OF PROPERTY MANAGEMENT CHRISTIAN BRUCE, PARTNER AT REDPATH BRUCE, AND COMPANY SECRETARY IAIN FRIEL LOOK AT THE CHALLENGES FACING PROPERTY MANAGERS IN SCOTLAND
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PROPERTY MANAGEMENT: REDPATH BRUCE PROPERTY MANAGEMENT LTD ne of the biggest challenges for property managers in Scotland is communicating effectively with the client and managing their expectations. Residential management portfolios are often diverse in nature and client type. Clients range from PLC’s to small groups of homeowners and the level of understanding about the role of the managing agent and the title obligations of the homeowner differs from client to client. Ultimately, the better you know and understand your client, the more effective a service you can provide for them. Understanding their clients is something Redpath Bruce has been doing successfully since 1907 to the extent that, although it still operates from the building where the business first started in a single room, the company having expanded and diversified, now owns and fully occupies the
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same building. The company remains family run, with grandchildren of the founder actively involved, and now has both surveying and property management arms. The latter, referred to as ‘house factoring’ in Scotland, has around 12,000 units under management with some 75% being residential and the remainder commercial. The majority of these properties are located throughout the central belt of Scotland, although the firm manages as far north as The Black Isle and to the south in Manchester. MANAGING COMMON ELEMENTS Partner Christian Bruce explains, “Block Management or Factoring, as it is commonly referred to, is often confused with “letting”, which is sometimes described by letting agents as “property management”, particularly in Edinburgh.” Christian is keen to point out that the factoring process differs markedly from that of letting: “Factors manage all the common elements of the property on behalf of the co-owners. We are not
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leasing the flats, making internal repairs or taking letting fees. Our contract is always with the common body of Owners who hold title to the property, as distinct from individual homeowners. As factors we have very little contact with tenants who tend to represent a small proportion of occupiers within developments. Redpath Bruce’s responsibilities, therefore, extend to arranging common insurance for the whole development, maintaining common areas, undertaking repairs and co-ordinating refurbishments of both the common internal and external fabric of a property. We issue service charge and common charge invoices that have a mixture of funding methods.” “Typically, we invoice our traditional tenemental clients on a half yearly or quarterly cycle in arrears for expenditure incurred, holding a float deposit to assist with cash flow. In larger modern residential and commercial developments we issue a common charge budget for the forthcoming financial year invoicing quarterly, half yearly or yearly in advance.
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PROPERTY MANAGEMENT: REDPATH BRUCE PROPERTY MANAGEMENT LTD
“ONE OF THE BIGGEST COMPLAINTS LEVELLED AT PROPERTY MANAGERS IS A LACK OF COMMUNICATION WITH THEIR CLIENTS” Effective credit control and good cash flow are essential elements of achieving successful block management and we have found that offering clients the option of a regular monthly payment by direct debit has brought about positive results for both homeowners and Factors. In addition to traditional “Factoring” we also act as a Landlord’s agent, collecting rent, maintaining their private property and netting the common charges against the rental income,” explains Company Secretary, Iain Friel. PROPER ACCOUNTING The accounting processes can be extremely complex and Redpath Bruce prides itself in keeping thorough and completely transparent records on behalf of their clients. A common example of an accounting challenge would be where ownership of a property changes hands within an accounting period. Care has to be taken that the two accounts are accurately apportioned. Whilst the regular costs are easy to predict, capital expenditure and major projects require consultation and agreement from all owners prior to collecting funds in advance of work being undertaken. In developments where there are many owners, this can be
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extremely tricky and the secret of success is always good and regular communication. “One of the biggest complaints levelled at property managers is a lack of communication with their clients,” Iain explains, insisting that this is something the company works hard to address. “The modern homeowner is very often faced with an extremely busy work and social life, which makes it difficult for them to meet with their Factor. Whilst email and websites have helped the speed of communication there is no substitute for speaking with, or meeting with, your client directly. It brings a different dynamic to the relationship and very often results in a more positive one going forward. “We are working smart to address this by offering to meet our clients in the evening along with other homeowners to discuss common matters concerning them. One meeting can be more productive than a hundred emails. In addition to this we have invested in IT solutions to smooth the process of delivering insurance information, documents, newsletters and invoices electronically to our clients. Where we feel we differ from most of our competition is that our managers run smaller portfolios but take care of most of the elements
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PROPERTY MANAGEMENT: REDPATH BRUCE PROPERTY MANAGEMENT LTD within the portfolio; from repairs and insurance claims through to special works. There will be no area within the management of a portfolio that the dedicated manager will not be able to talk about knowledgably. We believe that our clients value that and when they telephone Redpath Bruce, their call is answered by our very own Angela Mackay who then redirects them, in a professional and friendly manner, to the appropriate member of staff. Automated answering systems simply cannot deliver that personal touch which so often makes the difference in making the client feel more than just a number.” FUNCTIONAL TOOL “Information technology is key these days,” adds Christian. “Our website is more than just our shop window, it is a tool for our clients to utilise. Of course, it shows what we do; highlights our developer clients, our history and the various services we offer but its primary function is to provide our clients with easy access to insurance documents pertaining to their property, emergency out-ofhours contact details and also offers clients the ability to pay their bills on-line at any time of the day. With the arrival of new legislation in the form of the Property Factors Act, the time pressures of further administration have never been greater and only through the effective use of IT can we keep our managers on the telephone or on the road, making them available to clients and continuing to sustain and grow our business.” People’s views are influenced by the cost of proposals and the money they have available, a situation that has not been helped by the economic downturn. Redpath Bruce has therefore been striving to mitigate costs to their clients. An example would be a concerted effort to secure the most keenly priced insurance premiums while still using respected and regulated insurers providing excellent cover. That, to some degree, is tied in with proper maintenance regimes, for example; investing in the plumbing infrastructure of the building
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and installing leak protection systems can result in fewer losses and subsequently reduced premiums. Iain says: “Where we have a group of homeowners or a commercial client who has demonstrated a willingness to invest to benefit and sustain their building, we will proactively drive our resources towards assisting them by obtaining quotes, suggesting works and improvements whilst maintaining a regular dialogue with them.” TARGETING RESOURCES There are also buildings which dictate that they need more work and attention because they have been badly built or they have suffered long term historical dilapidation through inaction by previous owners. Things get to a critical point where something has to change so Redpath Bruce targets its resources accordingly. Assessing a property’s
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needs starts as soon as the company takes on the management. A building survey is undertaken to determine any essential work that must be done. That often gives owners the opportunity to invest in the improvement of their property from the outset of the contract and should point the way forward for the management approach thereafter. FRESH MANAGEMENT OPPORTUNITIES Christian elaborated on potential future management opportunities: “Whilst the Government’s Help-To-Buy scheme has given the housing market a long awaited boost and the green shoots of recovery are now genuinely visible, not just in the South East of England but throughout the regions and in Scotland, home ownership is still unattainable for the large majority of first time buyers. Whilst this situation prevails, opportunities remain strong for the private investor market alongside the institutions to grow their buy-to-let portfolios. The shortage of supply of quality stock has put upward pressure on rents and made yields even more attractive given the low capital values being achieved relative to the pre-crash era. Whilst Redpath Bruce has acquired over the years a number of loyal landlord clients with multiple buy-to-let
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properties, for which we provide a complete management service including the coordination of lettings and sales, we have never formally marketed the business as a letting agency and this is an obvious growth area for us. “Furthermore, we have seen a few of the larger institutions in London embarking on large residential PRS (Private Rented Sector) developments aimed at creating a model similar to commercial investments with a single landlord and multiple tenants in standalone developments. These Fund houses are keen to enjoy the further rental and capital growth which is predicted very simply by the severe lack of current supply. Whilst we are yet to see similar schemes in Scotland, it is only a matter of time and it stands to reason that these developments will create new opportunities for property managers.” In anticipation of a market upturn, Redpath Bruce has been investing in both quality staff and effective IT and this centurion business hopes to be well placed to cope with the increased demand for reliable and efficient property management services over the next 3 years and who knows, perhaps into the next century? www.redpathbruce.co.uk Tel: 0141 332 9041
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A RELATIONSHIP BUILT ON TRUST GRANT & WILSON PROPERTY MANAGEMENT LIMITED HAVE BEEN MANAGING RESIDENTIAL AND COMMERCIAL PROPERTY FOR OVER 100 YEARS AND UNDERTAKE FACTORING DUTIES FOR PROPERTY AND DEVELOPMENTS ACROSS SCOTLAND 74
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eing a family firm gives Grant & Wilson certain advantages, believes Managing Director Graham Mitchell: “Compared to some competitors, we are a friendlier, open company in the way that we deal with owners. I think that we have a different outlook to dealing with things because, as a family company, we tend to nurture and look after it. Some issues that arise from time to time with owners and tenants, we inevitably take personally and from that point of view there is a different way of responding and looking after clients.” The company started in Glasgow in 1899 and has since expanded into Edinburgh and Inverness. Taking over Bruce and Partners in 2011 gave it
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“WE TRY TO BUILD A RELATIONSHIP WITH OWNERS BECAUSE A CONTINUING TRUST IS IMPORTANT TO US” GRAHAM MITCHELL MANAGING DIRECTOR maintenance. So there is a different level of communication with landlords.” Communication is important and at a formal level is through explanatory notes attached to quarterly accounts that set out information with the common charges to cover the management fee, repairs, cleaning, insurance and general maintenance. The notes outline issues and required work for the property. Communication, as Graham outlines, is also on a more personal level: “We try to build a relationship with owners because a continuing trust is important to us. When we get that trust, we understand clients’ expectations, what their budgets are and whether proposals are likely to be accepted. We also get a feel for types of contractors they wish to have on site
or whether they want to use their own contractors. These things take time, from meeting with the owners, and gradually we get an understanding of what they are looking for because no two developments are the same.” WORKING WITH OWNERS Maintaining these relationships is particularly important during times of economic difficulty, enabling Grant & Wilson to keep abreast of the situation and minimise bad debt problems. “We understand that people are going through hard times and we will work with owners in respect of that,” remarks Graham. “If they come to us with a problem, we’ll endeavour to reach an agreement on monthly pay-
offices in Aberdeen and Ellon, which increased the property management business in the north of Scotland with a greater focus on leasing agency work, mainly for residential property. FULL SERVICE For leasing, Grant & Wilson works on behalf of landlords to find tenants and provides a full management service. The main activity, however, is property management where the company has 13,000 residential units it looks after for owner/occupiers. “We act as agent on behalf of the owners and have responsibility to look after the common parts, make sure repairs and maintenance are done and notifying owners of issues arising,” comments Graham. “It can be slightly different for leased property because some landlords have their own contractors for repairs and
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PR0PERTY MANAGEMENT: GRANT & WILSON ments and reviewing after a period. We are happy to work with owners on that basis if there is good faith on both sides because we are far better to get an affordable payment coming through until their circumstances change.” The regular work on properties sometimes leads to the need for refurbishment or renewal projects and having good relationships with owners is often crucial to getting them started due to the need to obtain agreement and funding from multiple parties. Even then, difficulties arise, as typified by a property in central Glasgow that’s taken almost seven years trying to obtain consent from owners and third parties. Graham recalls: “The main issue we had was getting consent from public transport organisations to allow scaffolding to go up and that has taken about two years. There are all these inputs and expectations we have to juggle from different parties, not least the funding angle towards getting work underway.” Projects often arise from owners’ committees setting out objectives for the properties. Alternatively, regular visits to buildings can highlight the need for refurbishment work and either method requires costings to be submitted and approved before anything can start. MINIMUM STANDARDS All work is undertaken by approved contractors with different qualifications and abilities. All, however, must have minimum standards and go through a vetting process with an annual review. “We check on them as much as we can,” comments Graham. “If contractors don’t perform, we conduct a one-to-one review, discuss the problems and required remedy, and give them an
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opportunity to improve. If they don’t, they come off our contractors’ list.” Having taken over Bruce and Partners plus another smaller factor recently, a period of relative calm is now planned. That, as Graham outlines, doesn’t mean no activity: “We need to consolidate although I have plans to change internal workings for property inspections and alter our management system for reporting and communication. We are trying to integrate our computer package more effectively into the way we work, allowing us to communicate better with owners in a variety of different ways.” www.grantandwilson.co.uk Tel: 0141 5522230
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PR0PERTY MANAGEMENT: HACKING AND PATERSON acking and Paterson is one of the country’s leading independent providers of property factoring services, having established an enviable reputation built upon strong foundations and a proven ability to meet the needs and expectations of clients. From its offices in Glasgow and Edinburgh, the company’s knowledgeable and professional team offers an excellent administrative service, along with advice and guidance on all aspects of residential property factoring, designed to ensure that it assists owners in maintaining and preserving the condition and value of their property throughout the years. Boasting a varied portfolio ranging from traditional tenements to the latest modern developments, it is Hacking and Paterson’s strong belief that the many years of experience and expertise it has gained since the company was formed back in 1922, is of great benefit to clients. This level of experience, allied to a culture of continuous improvement and a "hands-on" approach to property factoring, means that it is ideally placed to
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meet owners' property factoring needs, both now and in the future. Hacking and Paterson’s clients' property is very often the most valuable asset they will ever have and the company recognises the importance of its factoring role in maintaining their common property. This philosophy is underpinned by an in-depth knowledge of the property industry, coupled with skilled and dedicated staff who will arrange and administer all aspects of maintenance, repair and servicing of common property. Whilst its traditional role as house factor has been adapted over the years to reflect the changing patterns of property ownership, it has remained at the very core of the business to this day. As the business approaches almost a century of service in the profession, it remains committed to the values and philosophy that has allowed it to become one of the leaders in the field. With committed and enthusiastic staff, in both the Edinburgh and Glasgow offices, it is ideally placed to offer the same high level of care and attention to more and more property owners across the length and breadth of Scotland. The experienced property management team are on hand to assist clients with the instruction and
AN ESTABLISHED
REPUTATION ONE OF THE COUNTRY’S LEADING INDEPENDENT PROVIDERS OF PROPERTY FACTORING SERVICES,
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PR0PERTY MANAGEMENT: HACKING AND PATERSON administration of repair and maintenance works of a common nature to their property. Where appropriate, the company will enter into contracts for the maintenance of common property; and will always hold public liability insurance information for all appointed contractors and exercise financial controls including the payment and apportionment of contractors' invoices. If Hacking and Paterson ever receive a complaint from a homeowner about inadequate work by a service contractor, it has a full investigation procedure in place. The company issues periodic common charges accounts to its clients and maintains financial controls over the common service budget for the property, including a full debt recovery procedure for homeowners defaulting in payment. Regular meetings with homeowners and their owners associations are encouraged as well as periodic attendance at the properties under Hacking and Paterson management control. www.hackingandpaterson.co.uk Tel: Glasgow: 0141 248 5693 Edinburgh: 0131 523 1575
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