Building manager’s apartment

Nadeem asks:
(updated on Wednesday, August 06th 2014)

Are there any laws around on-site building manager apartments? Does the body corporate (BC) have to use that apartment for a manager? What if the manager doesn't want the apartment or if the BC doesn't want to lease it to the manager? Appreciate your help in this regard. Thanks.

Our Experts Answer:

A resourceful, practical and friendly on-site building manager is worth his or her weight in gold to the building’s owners. Generally speaking a term contract is awarded by the BC at the AGM to a building manager for a package including a salary for services and sometimes fully paid or subsidised accommodation within the building. The BC does not own the apartment rather it is owned by a private investor with a lease to the BC for the managers use. It is almost impossible to break this lease prior to the end of the agreed term. Often these leases have a ratchet clause in them which results in a very high rental being paid to the investor. In this case there has been precedent of a lease being renegotiated to a figure more in line with market rent but as I say it’s very difficult and rare to achieve.  Practically speaking a building manager will often sublease the manager’s apartment (often a smaller, ground floor unit with limited outlook) and privately rent a larger apartment with views, higher in the building.

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