Is Your Council Effective?

Source : The Business Times, September 27, 2007

A team with passion, balanced objectives and judicious management can help enhance an estate's value, writes JORDAN NEO

WITH the current boom in the real estate industry, we are witnessing a sudden, across-the-board escalation in property prices. In this exuberant state, the contribution and achievement of your council may become less evident and often unappreciated.

On the other hand, the damage done by an ineffective council may also not be noticeable until years later. This article explores how the effective contribution of the council can make a tremendous difference to the ultimate value of your estate.

First and foremost, we have observed through hundreds of estates under our management that a stable and cohesive council makes an effective team. A common understanding of shared objectives will promote unity, ultimately enhancing the running of their estates. Likewise, a council embroiled in constant struggles or politics will not be able to channel all of its energy, time and funds to actively drive and enhance an estate's value.

It is certainly a plus if you have a well-rounded team of specialised professionals from various fields such as legal, financial, engineering, architectural and management. Such a team would be better placed to manage and overcome important challenges through the stages of your estate's life cycle. In reality, however, some clients simply elect the minimum number of people to fulfil the legal requirements; not to mention creating a desired composition!

A less desirable but probably sensible solution is for existing members to 'head hunt' new members with a skill mix suited to the needs of their estate. This can be done ahead of an AGM, so that they can be duly elected. Often, new members are also drawn in by existing members because they share the same thinking.

A point to note is that increasing the numbers may not be an advantage. If there are limited volunteers available, it is far better to have a smaller but more dedicated team.

A member who is constantly unavailable to attend essential meetings can become a stumbling block - holding back the progress of the work. Such individuals, if they possess special skills, can still make valuable contributions by being invited to be independent advisers for special projects, instead of being a council member. Last but not least, the chairperson of the council should be firm but not domineering, having the full support of the office bearers.

Besides being able to set directions, he should also listen to and adopt constructive contributions from fellow council members. His capable leadership would also prompt residents to come forward in support of the council, instead of going against it. Most council members serve in their management corporation because they are motivated by a desire to improve their estate. However, despite their best intentions, we have opbserved that differences in member's viewpoints often lead to serious conflicts.

Such conflicts, together with the feeling of 'burn-out' and the lack of appreciation from residents, are some of the most common reasons for council members' resignation. In many residential estates, council meetings finish late into the night, fatigue sets in, poor decisions are made and tempers flare because of differences in approach.

When this happens, the managing agent is often drawn in and may end up at the receiving end. The council must guard against unhealthy conflicts. Ultimately, the estate value suffers because things don't get done, and no one really takes responsibility for anything.

To avoid such scenarios, it would be helpful for the council to set up a well-structured network of sub-committees. Members passionate or knowledgeable in certain areas can be given the authority to head different sub-committees (such as landscaping, events committee, etc), thereby ensuring that all works are kept within budget and are of high standard because of their interest and focus. An effective council will also clearly define roles and responsibilities of the sub-committees, thus reducing areas of overlap and unnecessary conflict.

Like a valuable managing agent, effective council members should try to serve the estate for a number of years, earning the trust and respect of fellow residents. Of course, the 'dream team' may not always exist; but even if it does, the council would do well when they take up the professional advice of a competent agent, especially where the use of management funds are concerned. This, of course, is a topic which would warrant a separate article altogether.

The writer is a practitioner with over 20 years of experience in property and facility management as a managing agent.

He is the managing director of Knight Frank Estate Management Pte Ltd (KFEM). He is also a member of the Singapore Institute of Surveyors and Valuers, and fellow of the Association of Property and Facility Managers.