Recently came across a detailed technical research on Managing Agents, written and published by Yung Yau and Daniel Chi. Skip the models and calculations if they don’t speak to you.
A few note-worthy excerpts:
“relationship between the board of directors and CEO is vulnerable to the classical principal-agent problems because of the diverse incentives of the two parties. The same also occurs in the case of MOH (Multi-owned homes a.k.a Strata) management. It is very common that PMAs (Property managing agents) act for their own benefits at the homeowners’ expense. Opportunistic PMAs may embezzle fund from the common financial pool (such as sinking fund and maintenance reserve) to their own pockets or make procurement decisions on their own instead of the homeowners. These malpractices of the PMAs have been widely reported in different parts of the world [29, 30, 31, 32].“
https://www.domain.com.au/news/csi-corrupt-strata-investigations-20111202-1o9nd/
I feel that some condo managers actually take on too many developments and leave out the proper and due care.
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I cannot agree more. Without proper checks and balances from Council members, some Managers veer towards profit maximisation.
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Exactly and most Council Members do not carry out their duties too and leave it to MAs! Sigh.
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