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Disorganised management company

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  • The management company can only do what is covered in the lease. If you want to fit electric car charging points etc., that would be outside of what is in the lease and you would need the agreement of the leaseholders (and as mentioned the need to amend the leases to cover future upkeep).

    As soon as you send people demands for increased charges I expect you will get a lot of engagement/responses!
  • gm0
    gm0 Posts: 1,274 Forumite
    Seventh Anniversary 1,000 Posts Name Dropper
    A sticky situation requiring sustained volunteer effort from directors in the face of rampant indifference and occasional splenetic ingratitude.  Legally the situation varies from site to site with individual or overall freeholds and leased elements and what falls in each domain.  And while the legal backstop needs to be understood.  Community decision making by neighbours who in some cases are both 1/N freehold company shareholders and leaseholders should not in general be done by legal bludgeoning if this can be avoided. Not very neighbourly.  Given how awful this process can become most volunteers only do it for a few years.   And votes of no confidence in directors are not what you need given how hard it is to get anyone to do it anyway.

    For older estate settings sinking funds for roof work, lifts, fencing etc. are a helpful construct. An annual budget "compromise" that a good budget will deliver - annual opex, planned maintenance (such as any painting cycle). Sinking fund for capital waxing and waning as long term larger capital expenditure renewal things come up.  For flats especially (because lifts) getting the annual, maintenance plan and sinking fund budget established is often the first order of business in the early years as developers don't much bother. Then perhaps freehold.  Then on to amenity improvement ideas. 

    A lot of estate properties will have longer term questions to address which are a) not in the lease b) not in the budget (because they don't exist yet) c) are contentious as to the timing when investment is actually sensible (cashflow now, vs property attractiveness/capital value longer term, impact of disruption, change to site amenity.  This is a very difficult topic to get right as the perspectives of a 35 year old professional couple and an 85 year old widow may well be (legitimately) different on the desirability of increased cost and disruption now for a real but less tangible benefit later.  See also owner occupiers vs landlords.

    Good examples would be:

    1 Uplifts to overall site power and local cabling for chargers to lots of exisiting parking spaces or undercrofts without it.  Not many older sites will have carpark cabling or ducting.  And overall site power won't have been upgraded in anticipation.  Five figure bills expected. A compromise where you put one slow domestic charger in one visitor space on existing 100A communal supply pleases nobody.

    2 Boundary walls and fencing doesn't last forever and can be a significant sinking fund cost on a site where the buildings don't generate much cost

    3 Individual house or flat gas CH and what is the strategy (workable on the site) when that finally goes.

    4 Replacement of old fashioned estate wired gate and doorbell access systems upon life expiry with something more modern perhaps mobile phone and tablet based.  See also CCTV

    Governance

    You either accept "unanimity" as a practical decision making bar but recognise this can cause long term blocking of all but responding to safety issues and legal mandates. Where directors can reasonably claim they have to act and follow the leasehold charge process to get it paid for.  Until a groundswell of demand for action on a particular amenity topic builds up.

    Or you can try and explain the legal position on decision making and shareholder rights, director powers of the freehold ltd and move forward with something more directive or majority decision making based.   There is no good way to explain this to people in the abstract without legal and contracts backgrounds which is interesting and accessible and encourages AGM attendance.  And no good way to avoid a discussion with people with such a background - accountants and lawyers.  'Tis a puzzler certainly.
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