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Property management as defined in wikipedia is the operation of commercial and/or residential real estate. The duties of property management includes accepting rent, responding to and addressing maintenance issues, advertising vacancies for landlords, and doing credit and background checks on tenants. One important role of property management is that of liaison between the landlord and tenant. There are several definition of property management, one is that property management might mean keeping their own property safe, secure and pleasant to the eye. For others, property management could mean paying someone else to make sure your property is in tip top shape. Some types of properties that may need property management are; houses, condos, duplexes, town homes, apartments, shopping centers, malls, offices buildings, airports and public transportation buildings, hospitals and many more. Property management is very similar to the role of management in any business.
In this coursework the writer will analyze the complaints and problems presented to the property manager of Megadosh Management by their client. To be able to do so we need to define important terms such as landlord, tenant and rent. The writer also presented the roles and rights of each person involve in the business. Property management agreement depends on the service needed by the client. The payment of their service is also mentioned. Upon understanding the role of property management the writer will now present the responses on the letter sent to the property manager. Discussion of each letter and identifying the problem is needed to response on their inquiry accurately. In the conclusion the paper will include his point of view and some important facts.
Definition of Terms
Landlord – as defined in www.lectlaw.com, is an owner of real property who leases (rents) that property to a tenant under a lease agreement. He is bound to perform certain duties and is entitled to certain rights.
His obligations are: (www.lectlaw.com)
- To ensure that he abide on the covenant that they both agree.
- To secure to the tenant the quiet enjoyment of the premises leased; but a tenant for years has no remedy against his landlord, if he be ousted by one who has no title, in that case the law leaves him to his remedy against the wrong doer. But the implied covenant for quiet enjoyment may be qualified and enlarged or narrowed according to the particular agreement of the parties and a general covenant for quiet enjoyment does not extend to wrongful evictions or disturbances by a stranger
- The landlord is bound by his express covenant to repair the premises, but unless he binds himself by express covenant the tenant cannot compel him to repair.
His rights are: (www.lectlaw.com)
- To receive the rent agreed upon and to enforce all the express covenants into which the tenant may have entered
- To require the lessee to treat the premises demised in such manner that no injury be done to the inheritance and prevent waste
- To have the possession of the premises after the expiration of the lease.
Tenant – as defined in Thesaurus as the one who pays the rent to use or occupy land, a building, or other property owned by another. In law, the one who holds or possesses lands, tenements, or sometimes personal property by any kind of title. (www.landlordzone.co.uk).
Tenant’s Legal Right and Obligations
- It is the obligation of the tenant to pay the exact amount for rent.
- It is the obligation of the tenant to pay the rent on time.
- It is the right of the tenant to have a comfortable property.
- Know the terms of the tenancy.
- Know the name and address of the landlord (normally included in the agreement)
- Accommodation which is in a good tenantable state of repair – free from defects.
- Reasonably quick and effective repairs if you report defects.
- Safe accommodation, all electrical, gas and other systems and appliances meeting modern safety standards and are subject to regular checks.
- A CORGI Gas Inspection Certificate annually and on entry to the accommodation
- Operating instructions, safety warnings and emergency procedures where appliances and systems may be unfamiliar.
- Peaceable and quiet enjoyment of the accommodation, free from demands for access without notice and/or interference with utilities or other supplies to the property.
- A rent book if the rent is payable weekly.
- A reasonable (statutory) period of notice if the landlord wants you to leave.
- The return of the security deposit within a reasonable period
- Give honest and truthful statements during the tenancy application process.
- Pay a reasonable (market) rent.
- Pay the rent as and when it is due.
- Respect and care for the landlord’s property, furniture and fittings.
- Pay the landlord for any damage (beyond normal wear and tear) at the end of, or during a tenancy.
- Pay the landlord for any exceptional cleaning and rubbish removal at the end of a tenancy.
- Report defects to the landlord immediately they become apparent.
- Not use the premises for any purpose other than residential accommodation.
- Not keep pets, unless approved by the landlord and the tenancy agreement.
- Not do anything in or around the premises which would cause nuisance, damage or annoyance to the landlord or the neighbours.
- Not bring into occupation other residents without informing the landlord. (Such additional adult occupant/s will be required to sign a tenancy agreement)
- Not leave the accommodation unoccupied for more that 14 days without informing the landlord or his agent.
- Give notice to quit in writing, which must be at least 4 weeks, where the rent is paid monthly.
- Not to use the security deposit in lieu of rent.
- Observe all the terms of the tenancy agreement
Property Management – Operation of property as a business, including rental, rent collection, maintenance, and so on.
Role of Property Management
One important role of the property management is to negotiate between the landlord and tenant. The property management should be aware of the laws and rights of both the landlord and the tenant. Problems and conflicts usually arise when the project managers are not aware of the covenants agreed upon by the landlord and the tenant. Property Management is being performed by the project managers. In exchange of the service they provide, property management companies charge landlords a percentage of the gross rent collected each month, in addition to lease commissions. Property managers may manage construction, development, repair and maintenance on a property. A property manager relation with tenants gives a face to the landlord and provides them the necessary buffer servicing their desire to profit and distance themselves from their tenant constituency.
The property manager or the property management company has a primary responsibility to the landlord and a secondary responsibility to the tenant. Relationships the property manager or property management team have with the landlord and with the tenant are crucial in forming the expectations of both parties to
the lease since both parties will seek and expect certain rights and benefits out of it.
Owner’s expectations from the property manager/ property management team are to carry out the owner’s instructions, control costs and maximize revenue to maintain a stabilized cash flow as a return on capital invested, exercise control over the building to safeguard the capital invested, provide a duty of care through proper maintenance of the building, to be professional and well informed, enhance the value of the property by making improvements that will increase its market value, retain and enhance pride of ownership
Problems in Property Management
Property Management is the one responsible for the covenant that the landlord and tenant agreed on. Any problems or violation of the said agreement would lead to problems and misunderstanding of both parties. This is where the role of the property management enters. They are the one who mediate and solve the agreement. When problems happens property management usually work hand in hand with the trained attorneys. During this situation the focus will be given on landlord/tenant law and most commonly evictions, non-payment, harassment, reduction of pre-arranged services, and public nuisance. Therefore, it is a necessity that a property manager be current with applicable municipal, county and state laws and practices.
The Megadosh Management
In the last few days Megadosh received four letters from their client stating several points regarding their request for maintenance, end of lease and extension of property. Megaosh need to reply on the four letters, to be able to do so we must need to analyze the problems and the covenant between the landlord and the tenant.
In the first letter, Mr. Smalls request to renew their lease for another term of 21 years. The landlord has the right to terminate or to not allow the renewal of contract. The request of Mr. Smalls would depend on the decision of the owner as to renew it or terminate the agreement. The contract ends on March 24, 2008, if the owner does not want them to renew the contract the tenant has the right to request for a 3 months extension to have them the time to relocate. The extension for lease may not be given authority of the owner since he is planning to renovate the whole area and putting up building as residential. If given extension on the contract Mr. Smalls still has no right to do the construction without the consent of the owner. In Commercial Tenancies Act R.S.O. 1990, c. L.7, the Lease until Breach (3) For the purposes of this section, a lease limited to continue only as long as the lessee abstains from committing a breach of covenant is and takes effect as a lease to continue for any longer term for which it could subsist, but determinable by a proviso for re-entry on such a breach. R.S.O. 1990, c. L.7, s. 20 (3). In this Act of Tenancies it shows that landlord has the right to refuse continuation of lease as well as expanding the property.
The Letter forwarded by Ms.K. Holmes of Unit 22 Desolation Row Shopping Centre on February 28th, 2008. Includes suggestion and request for the repair of the part of the structural roof of the Shopping Centre, which directly covers her unit. The tenant asks for the repair to be on summer. She also refuses to replace the lights because she cannot afford it. The question would be who will replace the lights? Whose obligation is it? Specimen Lease of Business Premises includes the following rights of the tenant: the Lessee may occupy and use any portion of the Leased Premises, subject to payment as daily rental for each and every day of the period up to the date of commencement of the Term of the Lease during which any portion of the Leased Premises is so occupied and used by the Lessee, at the end of such period, of the aggregate of the amount determined by multiplying. Internally you said you wanted me to change all the lighting to low energy bulbs, and to renew some damaged plasterwork on one of the walls. Another question would be who is the legally assigned person to handle the replacement of the light bulb? In the specimen lease covenant it was stated that lessor will be the one who will handle the repair and replacement of the light bulbs. To support the claim of the writer we will present the part of the Generic Lease/ Specimen Lease of Business Premises. Below is part of the Agreement to help Megadosh decide on this matter.
Services and Equipment
- The Lessor shall, at all times during the Term, at the Lessor’s own expense and to the satisfaction of the Lessee provide for and to the Leased Premises, maintain, and as appropriate, install and keep in good repair and operating condition, all in accordance with the Schedules entitled “Standards for Leased Accommodation” and “Cleaning Specifications” appended hereto:
- a constant supply of hot and cold water to all washbasins and sinks;
- a drinking fountain on each and every floor of the Building in which the Leased Premises are located;
- all heat, ventilation, air conditioning, air circulation and humidity control required in and for the Leased Premises;
- lighting and all electrical power required on the Leased Premises except as herein specifically otherwise provided, and, as lamps, bulbs, ballasts and fuses wear out, replacement thereof;
- a fire alarm system for use in emergency situations;
- an auxiliary supply of electricity and power for emergency services and systems throughout the Building, whenever a failure in the normal supply of electricity and power occurs;
- a constant supply of all dispensary items and deodorant blocks and all maintenance and repairs from time to time required to keep lavatory and toilet room equipment and accessories in good operating condition;
- removal of ice and snow from all outside parking areas and the roadways, walks, steps and fire escapes leading to and from the Building, all such parking spaces, roadways, walks, steps and fire escapes to be kept, at all times, free and clear of snow and ice;
- all maintenance and repairs required to keep the common areas at all times clean, tidy, free and clear of any refuse, garbage, waste products and, obstructing materials whatsoever, and in good condition and repair;
- where available, removal of garbage and recyclable materials from the Leased Premises whenever and so often as may be necessary and, in any event, not less often than once daily, to keep the Leased Premises at all times neat, tidy and free and clear of any refuse, garbage, waste products and obstructing materials whatsoever;
- all labour and materials for the cleaning of the Leased Premises, the Lessee’s Improvements and the furnishings therein, the windows of the Leased Premises and the common areas and the Lessor shall, at all times during the Term, clean the said Leased Premises, Lessee’s Improvements and furnishings, windows and common areas and keep the same clean and free of dust and dirt and maintain the grounds forming part of the Lands in the manner and not less often than as specified in the Schedule entitled “Cleaning Specifications”;
- all elevator service required with one or more elevators in operation and available for use at all times, throughout each and every hour of each and every day of the term and the remainder of which shall be in operation daily at all times throughout the period from 6:30 to 18:30 hours in each and every day, except Saturdays, Sundays and holidays observed by the Lessee and on which the Leased Premises are closed to the public generally;
- window and floor coverings and replacement thereof whenever required by reason of wear and tear;
- safe and convenient access for persons with disabilities to and from the Lands, the Building and the Leased Premises and the facilities for the use of persons with disabilities situated in and out of the Leased Premises;
- if so requested by the Lessee, a mutually acceptable location for bicycle racks, provided by the Lessee and in the care of the Lessor, having a capacity of at least … bicycles;
- provide all labour and equipment necessary for the collection, storage and removal of recyclable material in order to comply with the Multi-material and Paper recycling program of the Lessee, to the extent that a recycling infrastructure is operational in the community in which the Building is located, with the understanding that the Lessor will make available to the Lessee any records the Lessor has at his disposal on the total weight of recycled material removed from the Building;
Clause # 4 supports the claim of the lessee not to shoulder the expenses for the changing of the lighting and the repair of the plasterwork on the wall. Megadosh can work this out with the owner. It is better to review the agreement carefully to avoid further problem and conflict.
Another letter from Mr and Mrs Hiolternionen was forwarded with the subject for early termination of lease. Upon reviewing their agreement it was stated that: ‘If the Tenant wishes to determine this lease on the 25th March 2008 or on any date thereafter and of such wish gives to the Landlord not less than six months’ written notice and up to the date of expiry of such notice pays all rents due under this Lease and materially performs all the other obligations of the Tenant under this Lease then on the expiry of such notice this Lease shall forthwith determine.’ A six month rent deposit is still on the hand of the owner. The said amount will be returned when the Lease is at end. In this case the tenant should have given the landlord or forwarded a letter to Megadosh 6 months before they decided to move out. It was clearly stated in the agreement that they should have informed the landlord thru written notice not less than six months. Under the Leases (C0mmercial and Retail) Act 2001 – Sect 119 the lessor may contest termination
(1) The lessor may, within 14 days after being served with a termination notice, contest the termination by application to the Magistrates Court.
(2) The only ground for contesting a termination under this section is that—
(a) the lessor acted honestly and reasonably and ought reasonably to be excused for doing the thing that constituted the ground for termination under section 117 (Right to terminate—no disclosure statement etc) or section 118 (Failure to notify material change in disclosure statement); and
(b) the tenant is substantially in as good a position as the tenant would have been in had the lessor not done the thing.
The tenant should stay on the location for 6 months until they will be able to get the 6 months deposit they have given the property management. This will be the respond of Megadosh on their letter. If question arises they can read the copy of the agreement signed by them. Until all of their obligations are paid in full the refund for the deposit will be given to them at once.
The last letter comes from Mr. Pants he is requesting to let Harry Trash to use the rear part of the yard for repairs. Upon reviewing the lease of Mr. Pants Megadosh found the only restriction on assignment, it contains tenant’s covenant. The tenant’s covenant are as follow ‘not without the prior written consent of the Landlord, such consent not unreasonably to be withheld, to assign this Lease’; the user clause in the Lease states: ‘The Tenant covenants (a) not to use the building comprised within the premises otherwise than for the retail sale of gentlemen’s
clothing or for such other specific retail purpose as the Landlord may from time to
time approve in writing, such approval not unreasonably to be withheld, and (b) not to use the rear yard otherwise than for parking and loading of vehicles and/or for temporary storage of goods in connection with the authorised use of the building’.
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