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Changing hands

by Devina Divecha on Dec 27, 2012

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On January 13, 2011, the Jointly Owned Property (JOP) law was implemented in Dubai, UAE. Also known as Strata law, it has affected facilities management firms in a very significant way.

Before the law came into existence, developers awarded maintenance contracts for public facilities to FM companies. However now this decision rests in the hands of the property owners, who belong to what is called the Owners Association (OA).

FM firms rose to the challenge of dealing with the new rules, and have also formed Owners Association Management (OAM) wings to deal with assisting OAs with this task.

Roger Ghandour, director of association management, Mace Macro Owner Association Management says that with the implementation of the law, some FM firms realised that in order to continue to provide services to mixed use developments, primarily freehold communities in Dubai, they had to re-align their business with the changes taking place in the industry.

“The JOP law only permits companies with the Owner Association Management license to manage residential, commercial and/or mixed-use communities considered as jointly owned properties. FM companies that want to remain in the OAM industry may face several barriers to entry,” he explains.

Gopal Krishnan, general manager - residential, Emrill Services says integrated facilities management companies have no reason to fear the implementation of the strata law.

He explains: “Companies that have largely subcontracted over the years have suffered major organisational and internal changes in order to cope with the current requirements of the law.”

OAM Status
Ellen Rosenbaum, senior association manager, Stratum Owners Association Management says OAMs are the central point of any OA.

“The board of directors may make decisions and set policies but it is the OAM’s job to carry out these mandates. Just as the general manager of a large corporation makes decisions, recommendations and handles day-to-day affairs, the OAM shares the same duty of care.”

Ghandour agrees with Rosenbaum and says that a full service OAM can, and should, take the weight off the shoulders of the board of the OA.

“Most board members are volunteers, and have very little formal training in owners association management and will look for the expert advice of their association manager to help make informed decisions about their communities,” he explains.

Krishnan adds: “Generally home owners are unable to handle daily management duties of their community and property due to most being fully employed, permanently residing abroad or not having an association manager certification.

“Therefore the OAM’s role is very important in the whole process. Their role is vast; it ranges from daily management to sourcing suppliers, and from advising the board and collecting service fees from homeowners. Their knowledge to process and assist with cash flow, budgets, insurance, legal paperwork and communications is essential to effective management.”

Rosenbaum adds that the financial management of the OA is always paramount. The OAM is responsible for drafting the annual budget, assessing and collecting service fees and monitoring expenses.

Rosenbaum explains that the facilities management is an integral piece as well. “There are literally millions of components in a building, and each must be maintained and should be operating efficiently. The OAM is the co-ordinator for all of these services.

“I like to imagine it like a busy kitchen with everyone working hard in their respective areas. When the bell rings, a beautiful entrée arrives and the diner is unaware of the frenzy behind the scenes. So the next time you walk into a tower and the doors open, the air temperature is perfect, the lift works promptly, floors are clean and security greets you with a smile … thank the OAM and staff members.”

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