With new build developments popping up around Worcestershire, we are seeing an increase in property management companies (or “Mancos”)! These are usually private companies limited by guarantee with restricted objects to own, manage and maintain common areas on a residential development.
Corporate and real estate expertise should be interlinked to ensure that documentation reflects the areas for which the company is responsible and who is entitled to be a member of the company.
There is usually a restriction on the title to the property to ensure that the membership follows any onward change of ownership. It is important to include provisions in the articles of association to tailor them to the purpose of the company, such as provisions relating to what happens in the case of repossession, death and joint ownership. Where the Manco has been incorporated as a private company limited by shares, it is often useful to include provisions in the event that a former owner refuses or neglects to sign their stock transfer form to transfer their share to the new owner.
The Manco is usually responsible for the “common spaces” on the development, so that the property owners can then determine how these areas are managed and maintained going forwards. With the increased focus on environmental care and the concerns around the cost of living, this should provide the property owners with greater control in these key respects. The Manco’s articles of association can also be tailored to the structure of the development to accommodate the different interests of the various properties. For example, where parking areas are only used by the apartments, the management of these are not to be voted on by the members who are house owners on the development.
The board of directors will be responsible for the day-to-day management of the Manco, but will be accountable to its members. Engagement with the members may also be important – whether that be by way of formal general meetings for company matters, or more informal “residents” meetings.
Companies limited by guarantee are not required to record member names in the Confirmation Statements, so the members’ details are private. This makes is all the important to ensure that the Manco’s statutory books are kept up to date – new owners are admitted as members, former members are resigned from membership and certificates issued.
Our specialist corporate governance and company secretarial team can assist with Manco incorporations, meetings, changes to membership and statutory books. Our real estate team can also assist with the transfer of the common spaces from the developer to the ManCo at the Land Registry.