Monthly maintenance fees paid by Condo owners to cover the cost of upkeeping the buildings, grounds and common areas. This amount is subdivided into Managing Funds and Sinking Funds.
Nowadays we see a lot of hype in green landscaping among condos. Kudos to the Building and Construction Authority (BCA) whom promoted sustainable development with the green mark schemes and incentives. Our air is fresher and the economics made great sense for developers.
Yet some condo owners are not cheering. On closer examination, the green maintenance costs are surprising. I have heard much woes from friends in different MCSTs. Take a look at this excerpt from The Straits Times, which sums its up.
Today, Pemex is the world’s most indebted oil company with $176 billion of debts and liabilities. The Mexican government announced a $5 billion bailout for the company this year. However analysts say it needs to invest at least $10-$13 billion a year.
How did that happened over less than 15 years? Well, in short, years of disregard and non-maintenance. This is similar to managing a condo. Take for example the following chain of events:
“If you can’t convince them, confuse them.” – Harry S Truman
About five years ago, I was invited to an AGM as a guest and observer. The development had more than 300 owners and a quarter of them had turned up at the country club. There was refreshment and small bites. Imagine the costs.
The preceding AGM was rowdy enough to justify a security team on duty this round. The agenda checked most of the usual; monthly maintenance, appointment of MAs, Council members, additional parking lot, some minor by-laws. Blew $16k and four hours over squabbling small issues.
As I referred to notes about the financial details, it became clear many were missing the 200-Pound Gorilla in the Room. In summary, their fight over an extra $50 monthly was insignificant compared to a ticking $1.2 million replacement cost in two years time.
I wonder if there is a rising trend of similar cases in Singapore. A point of view suggested by my friend Thomas was that young families who became new condo owners have their hands full with their children and career. And they in turn form the majority of non-attendees to AGMs.
