Staffing amongst the chief challenges in block management
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“One of the main challenges we face is staffing,” says Binesh Tholath, managing director of Absolute Property Management, one of Cork City’s main specialists in block management.
More and more people are concentrating on individual property sales and management, which are often seen as the more active and ‘glamorous’ areas, rather than the steady work of looking after homes within the context of an apartment block.
It involves ensuring the longevity and quality of the whole building while ensuring that each individual property owner is content and on board with the programme too.
“Block management involves a lot of meetings, for example,” says Binesh, “AGM’s of the owners and keeping people up to date with what’s going on… It’s a different area… I’m not sure that most college courses in the area of property management go into the aspects of block management in enough detail.”
The area of block management may be one that isn’t experiencing a huge amount of growth at the moment. There are very few new apartment blocks being built nationally and almost none at the moment in the Cork area. However, there are projects in the pipeline and it is expected that Government incentives will play their part in encouraging more and more new apartment blocks to be built.
Over the coming decade, expertise in block management is likely to become a much more vital skill in the area of property and management letting. The educational sector will, hopefully, respond to this in training upcoming generations in the field.
If not, there will still be the specialists such as Absolute to pass on what they’ve learned.
As one of the main specialists in block management in Cork City, Absolute Property Management is seeing its specialised skills more in demand than ever, albeit sometimes with apartment owners grasping only relatively slowly the importance of block management; the importance of how such management operates in a property that exists not in isolation but as part of a collective within a larger property that needs regular care and maintenance.
The apartment blocks and complexes that constitute the current Cork property scene are, for the moment, an ageing stock and that fact presents its own set of challenges, according to Binesh Tholath, MD of block-management specialists Absolute Property.
“Quite a lot of buildings in Cork city are getting old — no doubt about that,” says Binesh. “And, as we grow older, we need more maintenance: the body gets older and you need more visits to the doctor — more maintenance. A building is no different, so the cost of looking after an older building goes up.”
There are, of course, inflationary pressures which add to the phenomenon, but the combination of ageing stock and generally rising costs mean that most property owners within a block or a complex have been facing higher bills.
Having said that, the market for landlords is a strong one and those with steady trustworthy tenants are doing well, with the importance of strong block management specialists behind them.
“The management fees have risen too,” says Binesh. “I can understand the landlords’ point of view because I own a property myself but everything is going up at the moment.
“The buildings are getting older and there aren’t too many new complexes being built in Cork at the moment.”
Some properties and/or management companies don’t have enough of a Sinking Fund to address the rising costs associated with apartment blocks and complexes. The Sinking Fund relates to monies set aside to look after refurbishment, improvements or maintenance of a non-recurring nature. It’s a rainy-day fund, if you like, for the kind of rainy days that are likely to occur every once in a while.
When major capital expenses come along, substantial funds are often required to keep the building up to date. A new roof, for example, is a cost that will run into the tens of thousands. Similarly, replacing lifts is an expense that will make deep holes in the Sinking Fund of a complex.
Once a building is over twenty years old, for example, there can be quite a lot of significant expense.
Replacing a lift might cost €40,000 or €45,000 and if there four or five lifts to be replaced at the same time, then the works required are in the hundreds of thousands.