Part 2 – Changing Managing Agents – Top 10 Things to Consider
5. The Size of the Property Manager’s Portfolio
There are very well-known and successful firms of block management firms out there which seemingly do quite well out of the claims that they restrict their property managers’ portfolio sizes to, let’s say, 10 blocks/estates. This never fails to make me chuckle. This information is useless unless accompanied with at least one other bit of information – the total number of units in that portfolio. A Property Manager may only have 5 clients, but if each has 500 units, this equates to 2,500 units. This would mean their portfolio is clearly far too large to manage efficiently. On the other hand, one might have 30 blocks/estates under their supervision but with each on average containing just 10 units, equalling a total portfolio size of 300 units. The point being made is that one side of this sum on its own is meaningless. So ask for both key bits of data. Generally, a manageable portfolio will be in the region of 600 – 800 units.
As a side-note, although portfolio size is arguably the most influential on a property manager’s workload, there is another important factor to consider and that is how the managing agent as a company is set up to operate. Having worked in this industry for the best part of a decade across 5 different companies, I know what I am talking about when I say that the division of responsibility across multiple departments and offices, if not organised efficiently, can cause real issues. If a Property Manager has to deal with every smallest detail for all administration of their portfolio, they are obviously going to be more stretched than one who has a large support team to take this element of their job off their hands. Conversely, if the support teams are set up in such a way that to get the smallest thing done means filling in a dozen forms, emailing half a dozen people, and then waiting for a response from someone you’ve never met who works 200 miles away, this isn’t going to work either!
6. Look at what Client Types they work for
Ask the agent what their split is between the three main block/estate management client-types; the three being RMCs, Freeholders and Housing Developers. Estate management companies that work for all three types evenly can find it hard to tailor their services to suit any one type in particular. If they predominantly work for large freehold-investors or housing developers, it may well be worth reconsidering whether they would be the right choice for your Resident Management Company. Working for people whose main aims are to sell flats and houses, and pick up ground-rents respectively, is hardly the same as working for home-owners. RMCs need a very specific type of management style which is more consultative and pragmatic. After all, RMC clients will more often than not have a majority of their volunteer directors calling the block/estate their home.
7. Out-of-Hours Emergency Assistance
Ensure that there is an efficient and reliable service in place to deal with emergencies arising outside of the usual office hours. It is still common to find management agents that just provide a number, or list of numbers, for a variety of different trades, i.e. you suffer a leak, you call a plumber. The problems that can stem from such an issue though are numerous. The plumber could simply not answer. He might attend to a concerned resident suffering a leak through her ceiling only to find that he cannot do anything about it as access to the flat above is needed but not possible. Perhaps an electrician is called for an alarm sounding in the common parts but it turns out to be connected to the lift. Someone has to pay for such examples of wasted call-outs too; either the person that called them, or the service charge payers collectively.
The most ideal emergency service, in our opinion, is one in which a phone is manned at all times, and where the person on that phone is experienced in dealing with hundreds of similar past issues. Not only that but they’d know key information about the building (access codes to crucial cupboards, for example) and have details of which contractors to contact for all the various issues that could arise.
If you have any questions or observations relating to any of these points, please contact us at JFM and we will be happy to help, or if we’re unable to ourselves we’ll signpost you to others that can.
Written by James Farrar MIRPM AssocRICS
Partner of JFM Block & Estate Management