Block in a Box discusses what a Residents’ Management Company is and what they are responsible for.
There are multiple entities which can be responsible for managing a block of flats or apartments. These include:
• Right to Manage companies
• Block owners
• Residents’ Management Companies
• Freehold Company
What is a Residents’ Management Company responsible for?
Residents’ Management Companies have a significant number of responsibilities involved in maintaining the smooth running of their block. These include:
• Issuing and obtaining service charges.
• Managing contractors and other services and staff.
• Keeping a service history of the block for future directors.
• Obtaining an adequate insurance policy.
• Managing S20 procedures in the case of major works.
• Handling the maintenance reports and needs of the block.
• Handling the health and safety inspections and checks for the block.
• Managing the finances, accounts and budget for the block.
What is the difference between a Residents’ Management Company and a Right to Manage Company?
Both companies have very similar responsibilities and are therefore easy to confuse. The main differences between the two entities are:
1. A Resident’s Management Company usually comprises of a group of leaseholders within the block of flats. They usually do not own the freehold of the land of the property. Normally, membership of the Residents’ Management Company is outline in the lease, making each flat owner an equal shareholder. This therefore means that when one shareholder sells their lease, their membership passes on during a handover period.
2. A Right to Manage Company is created when leaseholders exercise their right to manage as outlined in the Commonhold and Leasehold Reform Act of 2002. This means that the Right to Manage company take over managing the block of flats
For more information, please contact a member of the Block in a Box team on 0333 0154 145.