By Tracey Rissetto
It always amazes me how far water can travel, especially INSIDE a building. With the wild weather we have been having, leaks (both old and new) have appeared or grown, which brings us to the question of Maintenance.
A Long Term Maintenance Plan (LMTP) gives commercial property owners an understanding of the types of expenditure you should be allowing for and an awareness of the likely timing of major expenditure items. Over time, a maintenance plan will enable prospective purchasers to see that maintenance has been planned for and executed, and will add value to your property as a whole.
Warranties on building materials may require regular attendance to maintenance issues in order to remain valid, for example regular building washes.
Keeping up to date with the ongoing maintenance costs will not only help you keep your balance sheet in the black, it will help you maintain the value of your asset.
Body Corporate LMTP requirements
LTMPs are now a requirement for Body Corporates – Section 116 The Unit Titles Act 2010 requires each body corporate to establish and regularly update a LTMP. A review of the LTMP must be carried out every 3 years.
The intention of the requirement for a LTMP is to ensure that all owners (current and potential) investments are protected and maintained. A LTM fund is required to be established s117 Unit Titles Act 2010, unless by special resolution the body corporate decides not to establish one. S117 also has strict guidelines on the expenditure that this fund can be put towards.
Regulation 30 of the Unit Titles Regulations 2011 sets out that a long term maintenance plan must:
- (i) the common property, building elements, and infrastructure of the unit title development; and
- (ii) any additional items that the body corporate has decided by ordinary resolution to include in the plan; and
- (b) identify those items that the body corporate may decide by ordinary resolution not to maintain for any period during the lifetime of the plan; and
- (c) state the period covered by the plan; and
- (d) state the estimated age and life expectancy of each item covered by the plan; and
- (e) state the estimated cost of maintenance and replacement of each item covered by the plan; and
- (f) state whether there is a long-term maintenance fund; and
- (g) if there is a long-term maintenance fund, state the amount determined by the body corporate to be applied to maintain the fund each year; and
- (h) state who has prepared the plan.
For expert advice on creating a robust Maintenance Plan or assistance with your Body Corporate’s next LTMP review, contact Tracey Rissetto at Business Property Management