Legislation affecting common property management in Singapore

Abstract

Purpose – From 1967, responsibility for the maintenance and management of common property in strata developments in Singapore was borne by single-tier management corporations. However from 2005, through the concepts of multi-tier management corporations and limited common property, new legislation made sweeping changes to the way in which common property can be managed. This paper aims to discuss the present situation Design/methodology/approach – First, the problems inherent in the existing system of single-tier management corporations for strata property management until 2005 are examined. This provides a backdrop for a discussion of the solutions presented by new legislation in the form of “two/multi-tier” management corporations. Findings – The study reveals that while the multi-tier system could alleviate some of the problems existing under the single-tier management corporation system, other problems could arise; these include increased operational costs, finding sufficient volunteers for the multi-tier management corporations, and increased potential for conflict. Practical implications – There are practical implications for various parties including subsidiary proprietors, management corporations, developers and managing agents. Developers and property owners now have certain flexibilities that were not available under the single-tier system. Evaluation of the potential problems can result in greater efficiency and cost savings. Originality/value – While this paper is of general interest to all types of strata developments, it is of particular relevance to mixed-use developments, which may benefit from multi-tier management corporations. The paper draws on the experiences of other jurisdictions, which have implemented similar systems and introduced measures to minimize some potential problems.