MEFMA CONFEX 2017 The Multi Facets of FM and the People ...mefma.org/images/stories/confex2017/Confex2017-Day... · Successful Companies Successful Leadership Creative resolution

MEFMA CONFEX 2017The Multi Facets of FM and the

People who Connect ItMarch 13 & 14, 2017

The Address Hotel

CONFERENCE FACILITATOR

DUNCAN WADDELLChairman – Global FM

The Recipe to make TFM a Success

STAN MITCHELLKey Facilities Management International


• “The proof of the Pudding is in the Eating”!

• The formula for Success:• Chef (or cook)• Tools• Menu• Ingredients• Instructions

The Haggis!

The Chef (or cook)• The Expertise and

standards of the Input will directly influence Output!

Tom Kitchin –Michelin Star Chef

The Swedish Chef –Muppet Star

• Short Term• Quantity• $$$$

• Long Term• Quality• Sustainable• Life Cycle

The Tools

• Efficiency

• Effectiveness

• Data

The Menu

• Communication

• Clarification

• Perception

The Ingredients

• Expertise

• Fresh Produce

• International Ideas

The Instructions• Tried and tested formula

• The whole is greater than the sum of its parts

• Integration of the ingredients, in the right proportion, will deliver the anticipated output!


The Parallels are obvious????


For this:

• Chef (or cook)

• Tools

• Menu

• Ingredients

• Instructions

Think this:

• Facilities Manager

• Technology/ Data/ Equip

• Strategy/ Tactical Plan

• People

• Policy/Process/Procedure

The Parallels are obvious????

12

Relationship of Resources Applied to Performance Impact

Tactical Level

Strategic Level

Operational Level

FM Resources(people, expertise, etc)

Organisation Performance(costs, quality, etc)

Operations Management

Consulting

Services© Copyright KEY Facilities Management 1990-2017

All rights reserved.

Understand the Requirements & Priorities

Thank You

Stan [email protected]

mailto:[email protected]

CRUCIAL ISSUES TO BE ADDRESSED BY FM LEADERS

DUNCAN WADDELLGlobal FM

Gem Cutting and Polishing

• Planning• Maximising the value of the stone

• Colour retention

• Weight retention

• Cleaving or sawing

• Bruting

• Polishing

• Final Inspection/Quality Control

3 Key Elements of Leadership

1. Giving guidelines for what is to be done;

2. Getting people to co-operate, and

3. Supplying the energy and resources to reach set objectives.

Characteristics of Leaders

• Open and extroverted

• Inquisitive

• Sensitive

• Result and performance orientated

• Decisive

• Critical

• Experimental and tolerant of mistakes

• Charismatic

• Capable of inspiring confidence and enthusiasm

• Calm

• Willing to listen

• Warm and empathetic

• Unfettered by considerations of status or prestige

• Courageous

• Unflappable

• Flexible

• Willing to encourage development in others

Crucial Issues

• Walk the talk not just talking the talk

• ‘Back to basics’

• KISS

• Be prepared to make mistakes

• Challenge and educate inhibitors in a positive manner

• Adopt conviction and courage as traits

• Accept that others might know more or have the appropriate experience

• Know you have to respond with agility and capability to adapt

FM Leadership

2 key questions BEFORE you start:

• Why am I doing this?

• How is it currently done and how can it be done better?

THEN

• Get on and do it!!

The Size of the Prize!!

• Its up to you!

• It will feel sooooo good!

• Share with others

• Have fun!

The rewards can be yours!

WOMEN IN FM LEADERSHIPBlend & Perception

DANIELA VOICUKlue Service Management

Contents

Statistics

_______________________________________

Live stages

_______________________________________

Future Recipe

_______________________________________

Differences

_______________________________________

Key Ingredients

_______________________________________

Successful Companies

_______________________________________

The Way Foreword

34

Women Statistics in STEM

VARIANCES Teens 50%

50%

Graduate 27%

Graduate 25%

Work field 38%

Quit or never

work Below 10 %

Executives

Girls Are Smarter At School Than BoysThe University of Missouri and the University of Glasgow

Male and female mean IQs are about equal below the age of 15 but males have a higher mean IQ from age 15 on

0%

How did we get HERE?

=

Future Recipe

Leading innovation culture requires diversity leadership

COLLECTIVE GENIUS

COLLECTIVE CREATIVITY

INNOVATION

• Diversity is crucial for innovation

• A diverse and inclusive workforce

http://www.womenininnovation.org/2015/08/28/leading-innovation-culture-requires-diversity-leadership/

Why such gender GAP in FM

Factors Contributing to a Lack of Representation of

Women in FM Positions

• Lack of flexibility in the workplace

• Heavy workloads

• Shortage of mentors for women in the FM field

• Hostile male dominated environment

• Lack of acceptance from supervisors and peers

• Isolation

• Social Stigma : demanding, masculine and

aggressive

• Double burden syndrome :

o stereotype roles for women for familiar and

household responsibilities and

o child rearing

Key Ingredients

Create a marketplace of ideas through debate

and discourse. Amplify differences, don't

minimize them. Constructive argumentsto create a portfolio of

alternatives.

Never go along to get along. Don't compromise Combine even opposing

ideas to reconfigure them in new combinations to

produce a solution that is new and useful.

Test and refine that portfolio of ideas

Discover-driven learning Act the way to the futureLinda Hill –

Collective Creativity Linda A. Hill is the Wallace Brett Donham Professor of Business Administration at the Harvard Business School.

Successful Companies

Successful Leadership

Creative resolution

Creative agility

Creative abrasion

• Diverse and inclusive workforce is the key to innovation • Create the space for innovation : Open door policy for all • Build a sense of community to which people want to belong • Bestow credit in a very generous way• Co-create the future of company by participation • Hire people who argue with you • Sometimes it's best to be deliberately fuzzy and vague.

The Way Forward

RECOMMENDATION FOR ORGANIZATIONS:

• CREATE CLEAR, VISIBLE, AND TRANSPARENT PATHS TOWARD ADVANCEMENTs

• INVEST IN PROVIDING SUBSTANTIAL TRAINING AND PROFESSIONAL DEVELOPMENT

• COMMUNICATE CLEAR WORK GOALS AND RELEVANCE OF INDIVIDUAL TASKS TO THE BIG

PICTURE

• IT’S THE WORKPLACE CLIMATE!

• CREATE AN ORGANIZATIONAL CULTURE THAT VALUES EMPLOYEES’ CONTRIBUTIONS

• ROOT OUT UNCIVIL AND UNDERMINING BEHAVIORS IN THE WORKPLACE;

• CREATE A CULTURE THAT RESPECTS ALL

• CREATE A SUPPORTIVE NETWORK AT WORK: SUPPORTIVE COLLEAGUES, SUPERVISORS,

AND MENTORS MAKE A DIFFERENCE

• CREATE OPPORTUNITIES FOR FORMAL AND INFORMAL MENTORING

• OFFER WORK-LIFE INITIATIVES THAT ARE EMBEDDED IN FAMILY SUPPORTIVE CULTURES

• STRENGTHEN UNIVERSITY-INDUSTRY PARTNERSHIPS BY ALIGNING CURRICULUM WITH

ORGANIZATIONAL EXPERIENCES

• CREATE CLIMATES THAT HAVE ZERO TOLERANCE FOR INCIVILITY

Thank you for listening

THE CRITICAL ROLE OF STAKEHOLDERS MANAGEMENT IN FM

ALI ALSUWAIDIMEFMA Board of Director

Ali AlSuwaidi Profile

MEFMA Founding Board Member

Global FM Board

Successful ImplementationStakeholder Management in FM

Define FM

Critical Thinking in Facility Management

Building Metaphor for FM

Critical Thinking Examples in FM

FM Model & Stakeholder Involvement

Interactive Session – Stakeholders in Involvement

Q&A

•Adding

Value

Then (Rev.2001)

•Meeting

Business

Requirements •Optimising Costs

•Providing

Facilities

Solutions

•Property

•People•Technology

Facility

Management

Processes

هي إدارة عمليات متكاملة هدفها

حفظ وتطويرمجموعة الخدمات الالزمة لدعم أداء وفاعلية

مؤسسة معينة

Professional Core of Facility Management

Strategic Enabler of Corporate Business Success

Input Throughput Output

People

Technology

Money

QHSE

Business Vision, Mission &

Strategy

Legal Requirement

Risk Management

Reliance on outsourcing

Effective Implementation of

Competencies

Human Comfort

Health & Safety

Sustainability

Regulatory Compliance

ROI

System Thinking Skills Needed – FM Manager

Leadership &

Management

Operations &

Maintenance

Real Estate

Quality

Assessment &

Innovation

Human&

Environmental

Factors

Project

Management

Leading the

OrganizationCommunications

Technology

Finance

Managing the

Facility

Supporting

the Business

FM CompetenciesBuilding Metaphor for FM

Critical Thinking Examples – FM

Business Issues

TOC

LCC

Integration of Services

Design for Ops and MNT

Responsibilities

Cost Effectiveness

Constant Efficiency Improvement

In-house vs. Outsource

Quality of Life

Reasons & Contents

50

51

Discussion

RELATIONSHIP & AGREEMENT

The success of any facilities management operation relies not so much on the

contractual arrangement and governance but on the quality of relationships.

The relationship is as important as the contract.

http://www.ebusiness-solutions.ca/images/Acquisition.png

FM Model Benefits

What are the Benefits of FM Model?

Please take 15 minutes

to list 7 main benefits

FM Model Benefits

Clear & Transparent Communication Between Supply & Demand Sides

Simple & Manageable Concept: Internal & External Responsibilities of Services

Reduction of Conflicts

Integration & Coordination

Transparency

Improved Communication Between Stakeholders

Development of Tools & Systems

Systemic insourcing and outsourcing procedures

FM Model 3 Levels Examples

Facility products at the strategic level is called FM strategic integration & contains

the integration of all purchased & used or consumed products of an organization. It

is an integration & not just bundle of facility products1At the Tactical Level, it is divided into two main groups2 Tactical integration of space, infrastructure2.1

Tactical integration of people and organization2.2

At operational level, there are standardized products. The classification is just

identification code.3

FM Model 3 Levels Examples

1. Plan – SL / Client Interface / FM

Contract / Strategic Planning

TL/ Customer Interface / Defining SLA /

Resources

PL/ Ordering Facilities and Products / Services

2. Do SL / Integrating all Products

(Services)

PL/ Operational Doing & Facility Production

3. Check – SL Strategic Controlling /

Fulfillment of Requirement

TL / Quality Control & Cost Control

PL/ Evaluation of Products

4. Act SL / Change Management

/Managing Improvement Process

TL / Continuous Improvement Process

PL / Operational Measures

What to measure against?

Agreed

benchmark

Your

current

performance

Performance Gap

Agree:

1. What to measure

2. Best practice comparator

3. Current performance

Implementation

Understanding the performance gaps

• Performance gap:

– Lack of attention?

– Lack of knowledge?

– Lack of equipment?

– Complex processes?

– Lower skills?

Current Performance

Customer Focus

Information Management

Process Efficiency

Workforce Skills

Future Performance

Implementation

Correct Structures, Skills and

Motivation

Systems for Comprehensive

Measurement

Embedding Continuous

Improvement

Organisational

Structure

Job Design

Incentives Training

Targets

Results

Working on the structures, skills and staffing

Closing The Gaps

Inputs

Client needs

and scope

Service

structure

Agreed service

model

Mobilization,

resourcing

Outputs

Service

delivery

Quality

assured

Targets and

actions

Asset/service

lifecycle

CAFM data

integrationEnablers

Service

support

Staff

trainingCRM

concept

mobilize

operate

sustain

From the concept and model, to sustainable service

Using Benchmarks & Service DesignTo Add Value

Good SystemsGood Information

Good RelationshipsGood Communication

Good Management

You need to build up transparency and

teamwork culture.

Summary

Sustainability is not an added cost; it is

clever living

الستدامه هي ليست تكلفه اضافيه وانمااالستدامه نمط حياة

Thank You

المهندس علي السويدي Engineer Ali Al Suwaidi

PANEL DISCUSSIONWhy Pursue a Higher Education in FM?

DR. YASEMIN NIELSENHeriott-Watt University

MAHMOUD MAWEDHeriott-Watt University / ETA

SIMON LONGOman International Group SAOC

FERDINANDO SCALAMANDREManchester Business School

Moderator - MARK GRAHAMMacro International

RANDA BESSISOManchester Business School

STRATEGIC FAÇADE MANAGEMENT(More than just Glass Cleaning)

DARREN WILLIAMSSpider Access / Vertico X-treme

Strategic Facade Management(More than just Glass Cleaning)

• Why would you only maintain a third of the external buildingenvelope i.e. glass, whilst the rest of façade and curtain wallingsufferers with environmental pollution build up and thebuilding envelope ends up unbalanced?

• Why allow façade weathering to build, weaken and breakdown the building skin, often creating problems beyond simplecleaning or repairs?

• Traditional procurement processes and maintenance budgetingdoes not allow for the detail needed to protect the conditionof external façades.


• Construction investment seeing significant growth• Importance of ensuring building managers / owners and

budgets are aware of the external building fabric condition • Limited information provided on the condition of external

façades• Limited understanding on how high level building

materials and curtain walling weather and decay (New technologies / Extreme designs)

• Material life expectancy is not always as it was initially intended.

• Quality of initial installation!


• Managing in-situ building façades• Optimising each opportunity within traditional cleaning

and maintenance programmes to take greater action and deliver greater value.

• Proactive Protection of your Asset


• The 3 ‘P’s


• The 3 ‘P’s

• PERCEPTION


• The 3 ‘P’s

• PERCEPTION

• PREVENTION


• The 3 ‘P’s

• PERCEPTION

• PREVENTION

• PRESERVATION


• Why does it affect you?

• Liabilities and Obligations


• What should you do?

• Condition Survey

Cracks and crazing Surface finishesOpen movement joints Joint sealsCorrosion StainingMoisture Weep holes and Air ventsPlumb and level Moving partsHand rails Maintenance equipmentFixings and fastenings GasketsFire Breaks Electrical Installation



• Condition Survey• Planned Inspection and Maintenance (What does your Building / Structural O&M state?)



• Condition Survey• Planned Inspection and Maintenance (What does your Building / Structural O&M state?)• Component Durability

• Short 2-5 years• Medium 5- 10 Years• Long 10 – 20 Years• Very long Non-maintained during

building design life



• Condition Survey• Planned Inspection and Maintenance (What does your Building / Structural O&M state?)• Component Durability• Inspection Frequency

• Routine – All staff / tenant feedback• General• Detailed – not exceeding each 5 years



• Case Study


• Case Study


• Case Study


• Strategic Façade Management is;

• Whole Life Performance

• Pro-Active not Re-Active

• Utilization of all Access Opportunities

• E.g – Utilize your approved specialist service provider on each cleaning cycle to undertake an elevation condition survey – Typically 4 cycles per annum

= Whole building surveyed each year


Thank You

Questions Please?

OAM SERVICES IN DUBAIIts Relationship with FM & Challenges

NISHAT CHIDA - Wasl Properties&

ADNAN ZAINUL ABIDEEN – Nakheel Owners Association Management

Owners Association Management (OAM)

Law No. (27) of 2007 concerning Jointly Owned Properties in the Emirate of Dubai

Classification - Master communities, Residential ,Hotels, Retail and Mixed developments

Currently 75 OAM’s providers registered with RERA

>450 OA’s established

Value of OA business of >AED 200 million.

OAM- Value Preposition

Adds value to asset and property

Enhances the asset

image

Increases asset life

Improves community & the harmony therein

Optimize expenses, maintain asset

with Aim to enhance property

value

Ass

et &

Fac

ility

man

agem

en

t

Owners & OA Boards Role with FM

Owners -elect the board

Owners at AGA- ratify contracts , annual budgets & expenses

Board is elected to manage the affairs of the OA and procure FM services

Manage delivery of FM services through the Association Manager

Expect FM to Use best practices to deliver services

Directly

Procurement experts

Cheapest is best

Challenges in FM

Input or output specific services

Management of Specialist services

providers

FM services inside unit

Capturing FM costs in standard

format

Lack of benchmarking

Cost conscious clients

OA’s Relationship with FM

Alignment of client expectation for FM services

Budgets based on service levels

FM deliver services as per SOW & OAM evaluate service performance

OAM depends on FM to bring out innovative strategies to provide energy efficiencies

FM uses CAFM to analyze , report and provide solutions

OAM & FM work to enhance equipment & asset life

Client satisfaction & enhance asset value

Thank You

ASSOCIATION MANAGER’S EXPECTATION FROM FACILITY MANAGEMENT SERVICE DELIVERY

FAHAD MOHAMEDDeyaar Owners Association Management

DETECTIVE

Uplift the teams’ mood

Encourage motivation

CHEERLEADER

Show empathy

Act as a reliable point for the customer

Apologize for poor experiences

Provide advice

Walk customers through the various aspects of the community

THERAPIST

Bridge the gap

Speak to the customer

Take feedback

Explain to the admin team the customer’s requirements

Translate technical geek into layman's terms

TRANSLATOR

Be in the front-line in tough

customer situations

Remain calm in

sensitive customer

communication

Show strong diplomatic

skills

DIPLOMAT

Contain sensitive and incorrect information

Align the team and the service providers

Wrestle to bring all parties on the same page

COWBOY

Analyseissues

Analyseexpenses

vs revenue

Analyseservice

providersperformance

Summariseto optimise

future strategies

ANALYST

Email Clients & Service

Providers

Post notices

Prepare violation notices

Update the

customer

AUTHOR

Deliver

Meet demands

Close issues

Keep records

Marketing

Ensure integrity

Achieve savings

Association Manager

Authorities Owners / Developer / Board

Utility Providers

FM

AM

Our expectation

ProductProcessPeople

Consistent Performance

Staff / Contractors

Customers / occupants

Emergency Management

Quality, Health, Safety &

Environment

Effective Communication & Reporting

Use Different Methods

Repeat if required

Be Concise and Informative

Think like a C-level Executive

Don’t communicate in a Bubble

Performance Management

Measurement is the first step that leads to control

and eventually to improvement. If you can’t measure

something, you can’t understand it. If you can’t

understand it, you can’t control it. If you can’t

control it, you can’t improve it.

(J. H. Harrington)

TRA

Trai

ning

Setting a target based on training needs

Based on complexity of the facilities

Identifying the best mix of training resources

General awareness on ethics and grooming

Importance of time management

Importance of Performance

QHSE trainings

Trainings on communication and reporting

Top management involvement

Define clear objectives and

create awareness

among ground staff

Understand and plan effective

transition

Develop a training,

learning and development strategy to

respond to the changing work environment.

Follow good measurement techniques on

effectiveness of the training

Constantly monitor

performance

Stay up to date with the latest

technology

Ensure Customer

Satisfaction

Quality Service Delivery

The

AM

’s E

xpec

tatio

n

Hol

istic

App

roac

h

Cleaning

Security

Engineering (MEP)

Concierge

Landscaping

Specialist Services• Pest Control

• Waste Management

• Elevator Maintenance

• Fire Fighting System

• Fire Alarm System

• Central battery

• BMU

• Swimming Pool

• Water Testing

Thank you, any questions?

www.doam.ae

SERVICE CHARGE INDUSTRY IN DUBAI

MAHMUD MERALIMerali’s Group

118

DEVELOPER

Developer sells property

All owners become members of the

Owners’ Association

Owners’ Association Interim

-Board

COMMUNITY MANAGER

Jointly-Owned Property

BUILDINGS

119

DEVELOPER

Developer sells property

All owners become members of the

Community

Community Interim -Board

COMMUNITY MANAGER

VILLA COMMUNITY

120

WHAT IS AN OWNERS’ ASSOCIATION?

Owner Associations (OA) are non-profit organizations that are formed when there are more than oneowner in a property.

Owners’ Associations are formed to take care of the commonly owned properties. They collect monthly orannual dues to pay for maintenance of common areas like parks, tennis courts, elevators, gym, andswimming pools and can levy special assessments on homeowners when the association lacks sufficientreserves to pay for unexpected repairs. It also includes collection of reserve fund for future replacement ofassets.

121

WHAT ARE THE RESPONSIBILITIES OF OA?

▪ to supervise, manage and control the Common Areas and Assets for the collective benefit of ownersand in ways that promote positive environmental outcomes;

▪ to ensure that the building or Association, including the Common Areas, are maintained in goodconditions;

▪ to integrate waste management, energy and water efficiency policies into the Association's strategyregarding the Common Areas and Assets;

▪ to register the Jointly Owned Property Declaration, including Association Rules, and any BuildingManagement Statement in respect of the Jointly Owned Property;

▪ to promote harmony and a sense of belonging among Owners and Occupiers of Units;

▪ to obtain and maintain any license it requires by law;

▪ to maintain records and produce statements and other documents as required by this Constitution orthe Regulator;

▪ to otherwise comply with all laws, decrees, regulations, by-laws, policies and directions by which it isbound

122

WHAT IS SERVICE CHARGE ?

• Service charge is the amount collected from the owners to cover the maintenance cost of theproperty’s common areas and reserve fund for future replacement of assets.

• Every financial year, budget is prepared which forecasts the maintenance expenses for the yearahead and accordingly the service charge rate is derived. RERA Approved Budgets.

• After the end of the financial year, when the final cost of providing services is known, the finalaccounts are prepared and audited. These compare the amount charged during the year with theactual costs. If the costs are lower than the amount charged as service charge, there may be asurplus.

• If the costs are higher than the amount charged, there may be a deficit. In most cases the cost isspread by adding it to your estimated service charge in a subsequent financial year.

123

WHY IS IT IMPORTANT TO CONTRIBUTE SERVICE CHARGE?

• Service charge is collected solely to covers the costs of managing and maintaining the property onbehalf of all the joint-owners of the property. Therefore its crucial that all owners timely contributeto the service charge to ensure proper maintenance of the property.

• Default in service charges ultimately effects all the owners of the property, in terms of services andfinancial stability of the Association.

124

LATE PAYMENT FEE

What happens if you don’t pay

• Delay in service charge payments, ultimately affects the wider community.

• Potential to deprive your community of the funds required to continue the supply of essentialservices such as common area maintenance, air-conditioning, security, waste collection, streetlighting and irrigation.

• Timely payment of the service charge is vital to uphold the high standard of living you expectin your community.

125

LONG OUTSTANDING RECEIVABLES

• Service charges has been a contentious issue with property managers having to resort to blockades and legal notices to recover outstanding charges.

126

WHAT IS SERVICE CHARGE AUDIT ?

• Verify the financial statements, information & records prepared and maintained byCommunity Manager,

• Obtain reasonable assurance the financial statements have been free of materialmisstatements and properly prepared in accordance with financial reporting framework (IFRS)and in accordance with the requirements of the applicable laws and regulations.

• give a true and fair view of the state of the association’s affairs as at financial year end dateand of its surplus /(deficit) for the year then ended;

• with a view to express an opinion on the information given in the Management’s Report forthe financial year for which the financial statements are prepared is consistent with thefinancial statements.

127

AUDITOR’S RESPONSIBILITY

• Report independently to the owners / management

• Express an opinion on the Financial Statements

• Conduct Audit in accordance with ISAs (International Standards on Auditing) issued by IAASB(International Auditing and Assurance Standards Board)

➢ ISAs require

➢ Compliance with Ethical Standards

➢ Obtaining reasonable assurance whether the financial statements are free from materialmisstatement

➢ Obtaining audit evidence about the amounts and disclosures in the financial statements

➢ Evaluating the appropriateness of accounting policies used and the reasonableness of accountingestimates made by management, and evaluating the overall presentation of the financial statements

128

DEVELOPMENT OF A SERVICE CHARGE MODEL

• A high level cost model, with all necessary strata components including General Fund (operationalcosts) with a breakdown of each calculation methodology.

• This model apportions costs to stakeholders based on the most appropriate methodology for eachstrata component.

• This model allows scenario and sensitivity based analysis.

129

RESERVE FUND STUDY

• The reserve fund study is important as it acts as a separate fund to be used solely for the purposes ofpaying for the existing major repair and replacement of the common elements and assets of abuilding/community.

130

The Association budget of income and expenditure for the financial year in respect of the Common

Use Facilities should be prepared at least two (2) months prior to the end of each calendar year

together with capital expenditure. Provision should be made for all anticipated expenses including,

but not limited to, the following:

• Fire Protection

• Life Maintenance

• Landscaping

• MEP

• BMU

• Swimming pool

• Cleaning

• Pest Control• Security

• OA Management

• Waste Management

• Audit Fee

• Utilities

• District Cooling

• Insurance

• Master Community charge

PREPARING THE BUDGET

131

• administrative and professional expenses, including the costs incurred in enforcing the provisions

of this Declaration,

• management fees;

• contributions to the Reserve Fund;

• financing costs incurred by the Master Developer in connection with the establishment and

maintenance of the Common Use Facilities and related infrastructure in the Association;

• any other cost incurred by the Master Developer in connection with the Association including, but

not limited to, the cost of providing any other services which the Master Developer reasonably

considers in its sole discretion necessary for the purpose of complying with its management and

administrative functions in accordance with this Declaration.

132

➢ The budget shall cover all activities; income and expenditure (both capital and revenue expenditure) of the Association for the financial year to which they relate and the projections for the succeeding year. The budget shall be designated in Arab Emirates Dirham (AED).

➢ There shall be a budget for each Cost Centre accounted for under main headings such as income and expenditure (with the respective sub-classifications). Expenditure shall be categorized under capital and revenue expenditure.

➢ The budget should be sent to Owners’ Association Board for approval➢ Copy of approved budget should be sent to owners➢ Professionals can be engaged to review the budget➢ Exceptional expenditure should be approved from the Board

DO’S AND DON’TS OF THE INDUSTRY

133

The service charge fee is important as it covers all expenses relating to the operation and maintenance of common areas, below are some of the list of Do’s and Don'ts of industry in

regards to the service charge:

Do's Don'ts

Service charges levied to developer for unsold units. Unsold units not being charged any amounts.

Levies should be charged as per approved budget.Levies charged as per management prepared budget, not

approved by RERA.

Pre handover expenses being charged to developer. Pre handover expenses being included in OA expenses.

DLP and snagging issues being dealt by and expenses to developers.

DLP and snagging issues being charged to or dealt by OA.

In Facility Management contract include a clause that allows auditor access to all records of the FM company.

Deny auditors access to information and records

DO’S AND DON’TS OF THE INDUSTRY

134

Do's Don'ts

Service charges levied should be at a higher rate using participation quota, to hotels, restaurants and

commercial offices than to residential.

Charge equal levies to hotels, restaurants, commercial office and residential units.

Service charges to be levied from date of handover of units.

Service charges to be levied before handover dates.

Financial statements to be audited as per IFRS.Financial statements to be audited as per agreed upon

procedures.

Computation of reserve fund must be done professionally.

Do not make provision for reserve fund in the budget.

Deposit reserve fund in separate bank account (savings account)

Use up reserve fund as part of general expenses.

Use designated accounting system and effective controls

Let management over ride controls and operations.

135

THANK YOU

PANEL DISCUSSIONOwners Association Services & the Challenges faced by the Industry

FAHAD MOHAMEDDeyaar Owners Association

Management

NISHAT CHIDAWasl Properties

MAHMUD MERALIMERALI’S Group

Moderator – IMAD NAMRAWIThree60 Group of Companies

ADNAN ZAINUL ABIDEENNakheel Owners Association

Management

KANAGARAJ GURUSAMYDeyaar Owners Association

Management

Today’s Discussion

Panel Discussion 60 minutes

Introduction 5 minutes

Questions 40 minutes

Audience Q&A 10-15 minutes

Questions

Q1. With mounting pressure on cost’s by the Owners Associations how can FM providers preserve quality of service delivery?

Questions

Q2. How does the tenure of FM service provision contracts impact the OA (Short term vs Long term)?

Questions

Q3. What consideration should be applied in selecting a FM service provider for an OA Managed property?

Questions

Q4. Do you experience issue’s with OA Boards having conflicts of interest when selecting FM service providers in today’s OA market? And how would you suggest the industry can best overcome this?

Questions

Q5. Who leads the FM budget creation process and what impact do OA Board’s have on the same?

Questions

Q6. When considering FM contracts, what is the basis of delivery the OA’s should be looking to embrace?

Questions

Q7. What is the panels view on FM service provision relating to the common area of a OA property only? And are there circumstances where inside a unit should not be “the unit owner’s problem”?

Questions

Q8. When producing a Reserve (Sinking) Fund, should these be purely based on technical inputs and how sustainable are these studies in reality?

Questions

Q9. How important is it to introduce minimum standard qualifications into the industry and what should it include?

Questions

Q10. How do you see MEFMA being best able to assist in improving FM service provision in the OA market?

Audience

Q & A

THANK YOU

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