Shared Facilities in a Strata Management Statement

Mixed-use strata developments are becoming more commonplace, using stratum subdivisions through a Building or Strata Management Statement. One of the most crucial components to get right for the harmonious function of the mixed use project is the shared facility schedule – an annexure to the statement that apportions costs of the shared facilities between the different owner groups. 

Rob Monteath knows a thing or two about shared facilities, having practised as both a strata manager and strata surveyor for many years. He knows what works practically and has the surveying expertise to document this clearly through his understanding of stratum documents and plans. Rob has been engaged by surveyors and developers alike on some of the state’s most complex developments, putting together shared facility schedules and plans that clearly define facilities and fairly apportion costs.     

In this article, Rob unpacks some of the mysteries around shared facilities and considerations for producing shared facility schedules that enable good management that minimises disputes. 

An Introduction to Shared Facilities

A mixed-use building can contain just two uses, such as a small retail component and residential apartments, or a mixed-use building can contain up to 10 or more different uses. Such uses can include:

• Residential
• Serviced apartments
• Specialty retail
• Supermarket
• Childcare centre
• Office suites

• Hotel
• Council car park
• Medical suites
• Retirement living
• Aged care

When a building is subdivided into two or more stratum lots, there are many components of the building and services that need to be shared between the owners and occupiers of the building. For example, the driveway down into the basement car parking may be owned by the residential allotment; however, the retail and office allotments require the right to use the driveway, but they also have to share the responsibility of contributing to the operation and maintenance of the driveway.

Shared Facilities and the Strata Management Statement 

The strata management statement (SMS), which includes the shared facilities schedule, is the document that sets out how the management and operation of the building is to occur. Importantly, the SMS establishes the Building Management Committee (BMC) and sets out how it is to operate. Every owner of a stratum lot is to be a member of the BMC. Just as importantly, the SMS also establishes the schedule of shared facilities within the building and how they are to be managed and maintained.

The shared facilities include components of the building that all or several of the stratum lots benefit from, and also services required to manage and maintain the building. These items include:

• Car park access
• Basement car park ventilation and lighting system
• Passenger lifts and goods lifts
• Loading dock
• Main switchboard room
• Main telecommunication room
• The stormwater system, including stormwater storage tanks and on-site detention facilities

• Hot water service
• Commercial exhaust risers
• Building maintenance system
• Fire control system
• Security services
• End of trip facilities
• Car wash bays
• Waste storage facilities

The shared services for a building include: 

• Management of the BMC
• On-site building management
• Cleaning of the shared facilities
• Removal of waste
• Landscape maintenance
• Concierge services

The shared facility, for a component of the building, describes the location of the shared facility, a description of its function, and which lots within the building have the benefit of using the shared facility. Also, the percentage allocation of costs for the operation management of the shared facilities are listed.

The Strata Legislation requires that the allocation of costs for a shared facility is done fairly. Where possible, a fair allocation should use a quantitative method such as:

• Proportion of gross floor areas in each lot
• Habitable areas of each lot
• Number of car spaces within each lot
• Number of residential apartments within each lot, or
• Even the number of apartments per floor in the building.

It is preferable to adopt a “user pay principle” when allocating percentage costs for a shared facility. It must be noted that there is no exact and definitive way of allocating costs, but it must be done as fairly as possible.

It is recommended that a set of shared facilities plans is prepared, which shows the location of the physical shared facilities within the building. These plans can be helpful to orientate a tradesperson with the building as well as owners. They can help identify the areas of the building, which are available for communal use, such as rooftop recreational areas and communal gardens.

It is also necessary that a great deal of thought and care goes into the creation of the shared facilities schedule and plans for a building. A properly prepared schedule and plans mean that a building can be well managed and with a minimal number of disputes. An experienced strata consultant who is knowledgeable on strata management issues, titling procedures, and the requirements of a shared facility should be used to prepare the shared facilities schedule and plans.

Bear in mind that after the schedule and plans are finalised and registered with the SMS, it can be very difficult to amend the shared facilities schedule.

Shared Facilities vs Easements

Often comparisons are made between shared facilities and easements. Their legal status is similar.

A strata shared facility is created under the Strata Schemes Development Act and an easement is created under the Conveyancing Act. A significant benefit of a shared facility is that it is managed by the BMC. A BMC cannot be given the benefit of an easement so a BMC cannot directly manage the requirements of an easement.

Easements are more suited to land matters, such as a Right of Way or an Easement to Drain Water. A shared facility is very well suited to a building where it can be managed by the BMC.