What is Block Management and How Does it Works?

Written on 4 May 2021 by Courtney Manton in Frequently Asked Questions


Block management companies provide management services for residential leasehold buildings. This article looks at what block management companies do, why you might use one, and how to find a reputable provider.

Block management

What is a residential leasehold?

When someone purchases a flat that is part of a building or development, they are likely to be entering into a leasehold agreement.

A leasehold gives the purchaser the right to occupy the property for the period specified in the lease.

The freeholder owns the structure and common parts of the building and the land it stands on, sometimes also referred to as the landlord.

A lease is a contract that sets out the rights and duties of both parties. The freeholder is responsible for maintaining and repairing the building structure and communal areas and insuring the building itself. The leaseholder will agree to keep the property in good order, pay the service charge and ground rent, and abide by the lease restrictions and consents.

Some developments are sold as ‘share of freehold’, which means that the purchaser owns their leasehold plus a share in the property’s freehold. Generally, this done by creating a company that owns the freehold and each of the leaseholders owns shares in this company.

Residential buildings take a lot of managing. It’s not just the building and finances; countless laws must also be complied with. Because of this, freeholders, or freehold companies, usually appoint an agent to manage their block.

What services do block management companies provide?

Block management companies are engaged by the freeholder or freehold company to deliver the services under the terms of the leasehold agreement. There is no definitive list of services because no lease is the same; however, typical block management service includes:

Maintenance

A block management company is responsible for maintaining all areas of shared space, including the building itself and any garden areas.

Agents have relationships with a wide range of repair and maintenance professionals so they can deal with emergencies quickly and efficiently. They can also plan and implement longer term maintenance and repair programmes, ensuring a streamlined approach to maintaining the value of your block.

Block management agents will also manage maintenance contracts with third-party providers.

Insurance

Block management companies will ensure that the property is fully protected by insurance and that the cover is renewed.

Tenants

Management agents will vet new leaseholders for suitability and will manage ongoing relationships. The agent becomes their first point of contact, answers questions, liaises with the residents and tenants’ associations and deals with insurance claims.

Financials

Management agents will deal with both the day-to-day tasks of collecting service charges and paying employees and contractors and the periodic tasks of managing budgets and maintaining accurate accounts.

Legals

Managing agents keep up-to-date with the continually changing legislation concerning residential properties, saving you the trouble of working out the implications of each new piece of legislation for your block. Block management agents can also take on ensuring that tenants comply with their leases and represent you should any county court, arbitration, or tribunal hearings arise.

Employees

Running a block requires hiring employees, for instance, cleaners, gardeners and concierge staff. Under employment law, all these employees must receive appropriate contracts and fair treatment. Again, this is a task that a managing agent can undertake.

Site visits

Site visits are essential to ensure no maintenance or health and safety issues exist and that the block complies with regulations. A block management company will conduct regular visits to ensure that all the common areas are in good working order.

Why use a managing agent?

Managing a residential building is time-consuming and requires professional skills. The block manager needs to understand landlord and tenant law, health and safety regulations, building maintenance, accounting and much more.

Both freeholders and leaseholders have an interest in the building being well managed as a poorly managed property will impact the buildings value and the leaseholder’s enjoyment of their home.

block management agent

How do I find a good block management company?

Seek recommendations, look out for qualifications and take up references. Apart from gathering recommendations from other landlords in the area, look out for managing agents with links to the Institute of Residential Property Management (IRPM).

Be upfront about your block

Without adequate detail, potential agents cannot give you a fair and accurate tender for the job. Show them the tenancy agreements, leases and service charge arrangements. Discuss the block’s past and present problems with them. How they react will clue you as to whether these are people you can work with.

Ask plenty of questions

You’ll have numerous questions. Do you need to know whether you will have a dedicated single contact or whether you are being offered a team? Or how cover will be provided over holiday periods? Or how often will you receive reports? Or whether the agent receives commission from contractors or insurance companies? Brainstorm a list of questions before meeting the potential agent so that you don’t forget anything you planned to ask.

Fine-tune the contract details

An experienced agent will take you through a draft contract, customising it for your particular needs. You should cover everything from who has the final say on the appointment of contractors to the arrangements should any legal proceedings with tenants occur.

We can help

Our established block management department acts on behalf of both freeholders and freehold companies for a growing number of prime central London properties.

Not only are we responsible for the physical management of the property, but our service also includes:

  • Accounting and financial control
  • Regular property inspections
  • Management of maintenance contracts (e.g. for lifts and entry phones)
  • Dealing with enquires from tenants
  • Administration of major works
  • Company secretary duties

We can manage both large scales residential developments as well as smaller properties. Our approach and standards are the same regardless of the size of the development. Click here for more information on our block management services.

If you own a residential leasehold building and think we could help, our block management team would be delighted to speak to you in more detail about the services we provide. Contact us today.

Courtney Manton

Courtney is a Chartered Surveyor, the senior partner and owner of the Best Gapp group.

His special talent honed over the last 30 years is winning. Winning for his many clients.

Winning a Leasehold Enfranchisement case, winning a negotiation to sell or buy, winning a lower rent at review, winning a planning permission to enhance value, winning trust.

All articles by Courtney Manton

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