Painting The Building
One of the biggest and most expensive projects a body corporate undertakes is the painting of a building. Buildings are generally painted as part of their initial construction and the body corporate (assuming it is a Building Format Plan scheme) then takes on the responsibility of maintaining the external paint of the scheme. We have teamed up with our friends at Rochele Painting to bring you some relevant information on painting.
1. The importance of painting
It is not uncommon for us to hear people say things like, “the building doesn’t look too bad” or “the paint hasn’t faded that much”, which may be a fair comment, however, it is important to note that painting plays a bigger role than just making the building more aesthetically pleasing. Paint protects and maintains the substrate (concrete, timber, brick, etc); choosing the right paint, depending on the surface, can help prevent things like concrete cancer and rusting. Ideally, painting the building shouldn’t be deferred, considering that the exterior of a building is completely exposed at all times and is therefore subject to rain, heat, bird and bat excrement, pollution, and other harsh conditions. These elements can be quite corrosive and over time, as a result, paint will fade, loose its vibrancy and appear dull. Additionally, the paint will peel off and degrade the building substrate. Bearing this in mind, it is important to consider how to achieve a long long-lasting, healthy, paint on a building. Firstly, choosing the right paint is imperative. Paints that are washable are likely to last the longest; this is because they allow stains to be removed easier during building wash downs. Building wash downs are an effective way of removing built-up surface dirt and exterior markings, however, are usually used in conjunction before and after a professional repaint. While they are a cheaper alternative to a building re-paint, they are not a substitute and in some cases where buildings are approaching the 7-8 year mark since build, a wash down may do more harm than good. Best practice is to have building wash downs every 2-3 years, however, depending on the size, style, location and substrate of your building, it may require more frequent treatment. Taking care of these steps will help to increase the longevity of your paint and as well encourage a positive impression for visitors, customers and patrons alike.
2. How much does it cost?
Painting a building isn’t cheap; from the painting materials to the hired labour, it is often one of the highest capital outlays a body corporate faces. Costs range from tens, into the hundreds of thousands for bigger schemes. To ensure that the building has enough money when it comes time to paint, it is important that the body corporate has had a good sinking fund forecast that accounts for all expenses. Bigger buildings may want to consider having their sinking fund forecast updated more frequently to ensure they are still on track. Failing to raise enough money for painting of the building means the scheme either has to call a special levy from owners or, the works need to be deferred.
3. Process
3.1 Scope of works
Choosing the right contractor for your needs is obviously important, however, beforehand, the site should be inspected as a committee. This way you can take note of issues that need addressing later on. Before seeking quotes, have a specification done. This will ensure that when you go to tender, you will understand what you’re being priced for. Dulux have assisted many of our clients by visiting the building and doing up the scope of works for the scheme, (specification), at no cost, (Dulux makes their money because the scope of works is for Dulux paints only, as this is considered a premium paint most clients have been happy to use this service).
3.2 Put the works out to tender
Once you have your scope of works they can be put out to tender for comparable quotations. Speak to your Strata Manager about which contractors they have received positive feedback from in the past. Given the size of the project you will want to put it out to tender with at least three reputable contractors. .They should have the capacity to handle the scope of the painting project, have an understanding and know-how about the type of building (commercial/residential) they will be working on and as well, have a solid reputation It may also be important to include a deadline for the tenders to be submitted by. That way you can keep everyone working towards a planned timeline.
3.3 Having a consultant compare the quotes
Even with the set scope of works, painting quotations can be difficult to compare. Occasionally, there are variations in the scope of works from different painters. Some painters will include areas of the building as additional options while others may include those areas as part of their quote so the tenders need to be read very carefully in conjunction with the scope of works. This can be a time consuming process and we have noticed a lot of buildings are starting to use painting consultants to review the quotations on the body corporate’s behalf and to then provide them with a detailed breakdown of what they actually can expect to pay.
3.4 How can we be sure to cover our warranties on the paint
As mentioned above, it is a good idea to receive a specification before going to tender. The reason is because that it sets a standard for contractors to comply with if they wish to achieve a warranty handover. This will also help to narrow down your most suitable contractor choices for your project.
3.5 Get the owners’ approval
If you are planning to change the building’s colour scheme, it’s a good idea to get the proposed colour scheme included into the same general meeting and obtain the owners approval to change the colours. You will also need to seek owners’ approval for the cost of the works which will vary greatly depending on the building’s size, building damage, time frame, specifications and more. For a small body corporate of 6 blocks of units, costs can range approximately from $10,000 – $15,000, whereas, a large body corporate of 50-100 units may cost in the range of $100,000 – $200,000. Some of our clients have opted for payment plans, these plans allow for the building to be painted on time but for the payment to be made over several years. These plans are flexible and tailored to suit the particular needs of the body corporate. This may not be available through all contractors so it is best just to make sure before proceeding if it is something the body corporate requires.
3.6 Should we hire a project manager?
After awarding the job, someone needs to manage the project. Some contractors will offer project management, though, at a cost. Their responsibility, as project managers, will be to oversee deadlines, ensure project specifications are met, site safety and environmental management plans, obtaining the relevant council approvals and more.
4. Conclusion
As you can see, there is plenty of work that goes into the painting of a building. From the cost, the operation itself and obviously the time spent on the project, it is a substantial undertaking. Our strata managers have guided many bodies corporate through this issue and are only a phone call away when if you have any questions.
Good luck!
Managing Areas In Your Body Corporate
A friend of mine recently asked me to take a look at their Body Corporate documentation as they were being hit with a $700.00 special levy and she wasn’t sure what it was all about.
After a brief review of their Annual General Meeting documentation it was clear that the building was a scheme of 6 and needed to raise around $4,200.00 in legal costs for pursuing one of the lot owners for unpaid levies. The unpaid levies were further impacting their Body Corporate as they were struggling to meet their day to day expenditure. The unit ended up being sold at a Bailif sale and the Body Corporate was paid out the majority of their costs. In the interim however those costs had to be covered by the owners until it could be resolved.
But why did it get that far in the first place and what could have been done to manage the debt better? Here’s what we suggest to our clients:
1. Penalty Interest
Consider introducing penalty interest for levies that are outstanding. The body corporate can introduce a penalty to be paid by owners should their levies not be paid on time. The maximum rate of interest that can be charged is 2.5% simple interest for each complete month that the debt remains outstanding[i]. This helps the body corporate motivate the owners to pay on time and also penalises those who don’t pay on time rather than penalising the other owners who have to carry the body corporate’s costs. If there are no penalties for late payment the body corporate levies will receive the lowest priority.
2. Discount for payment on time
The body corporate can allow a discount for levies paid by their due date. This has to be accounted for in the budget of course but it ultimately motivates the owners to ensure levies are paid on time. The legislation permits the body corporate to provide a discount of up to 20%[ii] which most owners in a scheme are keen to take advantage of
3. Follow up outstanding debt and keep an eye on it
Legally under Qld Legislation, the Body Corporate is only obligated to send a debt to debt collection once it has been outstanding for two years.[iii] It is best practice though to keep on top of these debts and address them as soon as possible. The longer these debts are left the more they mount up and the harder it becomes for the owner to pay. In our office we issue the owners with notice 30 – 45 days before the levy is due for payment. Owners are then sent a reminder 14 days after the due date. 14 days later the if it is still unpaid they are issued with a notice that the debt remains unpaid and 14 days after that they receive a final notice. If the debt remains unpaid after that period we will try to contact the owner by phone or email. Finally we will approach the Committee to see if they want the matter to be sent to debt collection. If it is sent to debt collection, the collection costs are on charged to the lot owner in question along the way.
4. Become known as a no nonsense Body Corporate who is firm but fair
Remember that there are sometimes owners who may be in unfortunate or have extenuating circumstances. On occasion persons may not have been in debt before and are unsure of how to deal with it. Some people resort to shutting down and not communicating with the body corporate in these circumstances. The body corporate should show empathy and try to resolve debts where possible in a timely and fair manner. However, it should not let it’s self be taken advantage of. The best results we have seen in the past have been where the body corporate has agreed to an affordable payment plan with the debtor that addresses the arrears while keeping ahead of levies that become due.
– Henry Wheeler
[i] S 142 (2) Body Corporate and Community Management (Accommodation Module) Regulation 2008
[ii] S 141 Body Corporate and Community Management (Accommodation Module) Regulation 2008
[iii] S 143 (2) Body Corporate and Community Management (Accommodation Module) Regulation 2008