Managers win fight to secure 10-year extension on NSW agreement
At a time when many are experiencing difficulty trying to extend their MR agreements, particularly in New South Wales, David and Honi Ranieri from Riviera Apartments have managed to buck the trend.
Mr Ranieri spoke with accomnews this week to talk about how they were able to achieve the extension without the backing of body corporate and with the chairperson wanting to run the agreement to zero.
He explained: “This is the second time we have tried for an extension at Riviera Apartments. The last time was two years ago and it failed due to the full committee not supporting it. This time we had three out of the nine committee members supporting us. The lesson we learned from the first try was that the committee are irrelevant when it comes to the extension. It is good and helpful if they support you but due to the new argument we were putting forward, the non-support actually helped us in our argument that the onsite mangers had a long-term view and that the committee short term with personal agendas, while our main argument was the continuity of experience and that the management rights management system was the best system available compared to hired caretakers or committee run management.
“This time around we didn’t even advise the committee that we were going to go for the extension, they found out from our campaign material and called us in to discuss. As I stated to them, I was happy to discuss the merits of the extension but was not seeking their support. They then decided to vote whether to support us or not and that’s when I found out that we had the three supporters. As the majority of the committee vote against us the chairperson sent out an e-mail to all owners that they did not support the decision. This worked in our favour as we were now able to argue the ‘for’ argument, better than they could argue against it. It made us look more knowledgeable and their arguments were easily shown to be wrong.”
Mr Ranieri noted that a combination of social media, emailed newsletters and organised information nights were essential to getting the message across. “We used Facebook, Twitter, emailed newsletters and ran information nights to directly communicate our message to the owners. We organised a third party to accept the proxies and worked very closely with the strata manager to ensure everything we were saying and doing was acceptable under the current legislation,” he added.
“While talking to owners, we remained respectful of the committee and praised their volunteer status but explained that committees can change every year and no-one has more experience and knowledge of the complex than their onsite management team. The main argument that worked for us was explaining the management rights management system and comparing it to other available management systems. By arguing this very important point, it took the ‘personal’ out of the debate and we were able to logically argue how much better the management system was whether we remained as the mangers or not.
“Unfortunately, the argument takes about an hour to explain properly, which is why we did approximately seven info nights with powerpoint presentations and had owner and committee members come to them. The feedback was positive and we got a lot of owners stating how grateful they were to finally understand how the management system works. The final vote count at the AGM was approx. 160 ‘for’ and 50 ‘against’, with the majority of ‘against’ voters voting that way due to personal reasons against us rather than disagreeing with the management rights concept. (Riviera has 502 lots.)”
Altogether, the process took about three months beginning in January and coming to a close April 27. For any other managers out their facing a similar fight to extent their agreement, Mr Ranieri said it is essential to remove the ‘personal’ element.
“This was the third time my wife and I had been through this management rights extension, with the first two having failed due to debating based on us personally rather than the management rights concept. The argument we put forward now removes the emotions from the debate and we had a clear factual message to the owners regarding their investment and the lifestyle, and more people understood this type of argument more so than ‘vote for me because I’m nice’.”
Any hesitation a body corporate may have to renew or extend an agreement, Mr Ranieri said is likely due to miscommunication and misunderstanding. “Because managers are unable to debate the extension and management rights argument logically, the committee just thinks of us as someone the developer has put in.
“Our industry spokespeople don’t have a clear discussion paper explaining the amazing benefits of having this type of management system in a building/complex. I believe that the argument we put forward, with the presentation we did during the info nights, would help any manager and committee rethink their decision to outsource the onsite management and explain that any management rights manager is not just after the money but passionate about managing buildings and complexes for the benefit of all that have invested in it.”
Let accomnews know if you have struggled to extend your agreements in the past, or conversely if you have never experienced a problem.
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