For many bodies corporate, this time of year signals AGM season. As managing agents set up annual general meetings (AGM) with trustees and other body corporate members, it is important that all the required documents and figures are ready for this important gathering.
When determining the insurance value of a building, it is important to consider all the relevant factors. The Africa Property & Construction Cost Guide 2018 – published by AECOM, the globally renowned infrastructure firm – is a very helpful guide when estimating a building’s replacement cost.
Every three years, when the mandatory insurance valuation is due for bodies corporate, trustees and managing agents set out to collect and compare quotations from different service providers. Some trustees seek to make it a painless exercise by appointing the valuer recommended by the managing agent, others appoint the valuer offering the cheapest quote without considering any other factors.
Portfolio managers are generally expected to obtain at least three quotations for the body corporate prior to appointing a valuations service provider. While this practice favours the idea of good governance, it is time-consuming and complicates the portfolio manager’s job tremendously.
The properties are compared by erf size, number of bedrooms, number of bathrooms and quality class. Needless to say, this automated mass valuation method cannot take into account factors that require a keen (human) eye, such as state of repair, specific design, etc. This often leaves the accuracy of such valuations in doubt.