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sinking fund management
for strata and commercial buildings part 2. Earlier on we looked at the sinking
funds and the history of
sinking funds and that in Australia so what we'll look at
will be case study and we'll go through
what looks like him in one of the reports and how that sort of goes together
so the problem
with a lot of sinking funds there's
not enough money put aside for major items
and if you don't look after your building
in the other states as opposed to
Queensland you only get yourself in a little bit of trouble so
the one I'll...we'll will start off with it's
one that's in not really the best condition
and I'll go through that and see
let you know the way that we sort of try to manage that better for the client
alrighty. So
this is a set of 56 units
the building hasn't been maintained for
20 years there' building cracking
there's paint repairs that need to be done
the complex is underinsured, it needs painting
the pool needs attention, retaining walls are falling down
and you've got pipework issues so
and they've got a fair bit of work that they need to do
now where you can see
in these sinking funds there's two critical areas
in here in the management of the sinking fund forcast
one is looking at the elements of the building and how
those elements make up the
sinking fund forecasts and then the second part of what is it
to look at these parts and go how are we gonna jumble these around
alright. Now you usually find that painting is in say a 10 year cycle
and you'll find there's
as part of these 3 items
we're gonna have a look here so
there's 2 painting cycles that are in this building
so we'll have a look to see where these main issues are
so you can see in here all the cracking and that from the
Gyprock and so you got water penetration in going through he here
so the longer you leave this sort of stuff then the more you're gonna pay
so if we go and have a look
here you can see this is your first critical area of your sinking fund
forecasts and then this is the second cycle so at
at the moment now they've got not money
much money in the bank now so what we had to do is try and to
juggle these figures around here to make that nice and smooth so we don't have to hit
them with special levy first up so what we try and do is minimize the impact
to the body corporate
or owners committee to make sure that everything's
sort of runs as smooth as possible so you can see
this is one part of the area that needs a bit, abit of trouble, you've got
a paved driveway so you gotta put some money aside for the pavers in here
now as your building gets older you've gotta got a heap of trees sitting around the country side
so we need to have a look at that to put some money aside to look after those
trees
Ok? So we're looking at driveway area
underground pipe work; now the gardens
most of that is administration fund for your day to day
now if you're looking for a refurbishment on a large item
then that would be your sinking fund later down the track so you've got
the painting to your main building and superstructure
you got some money to put aside for your roof, you've got
your downpipes down the side and then
from the common areas you've got common stairwells
which need to be serviced and painted so what we ended up doing was
painting...well
first of all we cleaned up all the...got the building repairs got
got that done in year 1 then in year 2
then we painted the outside of the building and then in year 3
we painted the inside stairwells because they can last a little bit longer
and that's why we sort of staged that over the first
first 3 years 'cause that's the biggest impact and then we
managed to bring the levies down to a bit more a reality
until they're back on track for their second part of the cycle
so that's one section that we can look at in that
part 2 we'll go through one of the other reports and...