STRATA TITLED RETAIL PROPERTIES : PROBLEMS IN REFURBISHMENT

Abstract

Strata Title is a form of multiple ownership. By legislation, the consensus of all the unit owners is required in decisions involving a substantial capital outlay or the common property. This presents several difficulties in the undertaking of upgrading projects. With reference to strata titled retail developments, this dissertation seeks to examine the refurbishment projects of these properties and evaluate the problems and constraints faced by their management corporations in such works. The lack of finance is a major problem in the management corporation's decisions to refurbish. Conflicting interests, uncertainty in council decisions and frequent changes of managing agents are also contributory factors. It is concluded that reforms to the current legislation are required in order to facilitate refurbishment works. The establishment of the sinking fund, in particular, requires stricter enforcement and clearer guidelines. Alternatively, a compulsory refurbishment fund may be imposed on older buildings. This ensures the safeguarding of funds for expenditure on necessary improvements which may otherwise be disapproved. Finally, as in any refurbishment works, an undesirable tenant mix must be avoided to ensure that the upgrading works are not carried out in vain.