Why Managing Agents Are Ineffective…

Have you ever heard someone say that they are blown away by the service their managing agent delivers? How often have you heard of a managing agent going the extra mile or above and beyond the call of duty?

I have never had the experience or met someone who has. This is not to say there are not fantastic managing agents and firms out there but rather if there are, they are a small minority.

Why would this be the case?

I attended a Sectional Title training course at Paddocks last year which gave me some much-needed insight into the law that governs sectional title properties as well as the environment and culture that seems to be the norm within managing agencies and its not pretty.
The guys I met were mostly in their 20’s, maybe early 30’s and they all seemed rather unhappy and deflated. It was a three-day training program which gave us time to socialise and as the conversations progressed and people relaxed there seemed to be a consistent trend in the language they used and conditions they worked in.

How managing agencies tend to run.

What I discovered was that per employee or rather “managing agent” they can have around 20 sectional title schemes under their management at any given time. Can you just imagine all the work involved in that? That’s 20 AGM meetings to attend per year, financial statements need to be drawn up, minutes of the meeting documented and distributed, dealing with insurance claims, trustee and owner squabbles, building issues and maintenance etc.

The list goes on, it’s simply not a scalable business model that would deliver quality results to every client. I don’t know how many times I have called managing agents I deal with and don’t get hold of them, don’t get called back, late responses to emails, the usual.

BUT is it their fault?

Or is the company at fault by increasing the workload these agents take on to increase profits and their bottom line? Is the consumer possibly at fault for choosing price as their main decision maker when choosing a managing agent?
If the price is the main factor, it would force companies to drop pricing to compete and as a result, pile on as many schemes to an individual as possible to maintain profits and keep expenses down.

I feel each party is at fault in this scenario, trustees don’t often understand what’s required of a managing agent, they don’t know their duties as trustees and as a result, make uninformed decisions, albeit with the best intentions.

Managing agents simply have too much work on their plate, however, like my grandfather always told me, “If you do a job, you do it properly, or not at all”. No one has time in this day and age for incompetence and slow response times. Trustees and owners shouldn’t have to struggle to get issues sorted out and responses to emails. Nothing later than 24 hours response time should be acceptable in any business environment.

Then you have the corporations, who only have their bottom line in mind and are not service delivery focused, if they were, I’m sure we would have a lot better relationship with the managing agents we deal with daily.

So what’s the solution?

Well, the culture and norms need to change within the sectional title industry as a whole. Owners and trustees need to understand you pay for what you get. If you want a super responsive, pro-active managing agents, that agent needs to be paid more, so he doesn’t have to scale the number of schemes under his/her management. It’s not rocket science.

What we have successfully implemented in Camps Bay and surrounds is to partner with body corporate’s and their managing agents and taken on the workload of actually being on the ground, being the eyes and ears, implementing R&M jobs, checking on the contractor’s work post-completion and ensuring the block is being run successfully from a hands-on approach, this is property management.
The role of the trustees should be to approve medium to large scale jobs and ensure the smooth running of the block, not doing the running around for it.

Do you think the nature of how BC and MA will change and how has your experience been with your managing agent? I would be keen on hearing about your experiences.

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