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TRANSCRIPT
1
Planning
Disposal
Operations & Maintenance
Execution
Procurement
Operation & Maintenance
Planning
Performance Monitoring
Design
Refurbishment
/ Replacement
Construction
Transition
Asset Life Cycle
CHALLENGES IN REAL ESTATE SECTOR
The role of the real estate sector in the economy has evolved over time.
All of these changes is driven by the waves and intersections of technology,
globalization and sustainability.
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DISTRUPTIVE TECHNOLOGY
Technological revolution has provided consumers with more choices and greater access.
Consumer access to real estate information caused a paradigm shift to how real estate information gets disseminated and interpreted.
No point fighting, the only way is to anticipate, adopt and assimilate.
For example, buyers do not heavily rely on real estate agents to see what’s going on in their area, they can do that online.
More than 80% of potential home buyers use the internet to educate, research and find real estate opportunities.
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GLOBALIZATION
The global transactions have extended their influence to the real estate sector, resulting in cross-border investments in real estate, international development projects, and multi-national real estate ventures.
Globalization can influence real estate in two ways:
Affecting the implicit value of a location.
Affecting the implicit value of a building.
However, global trends affecting location quality tend to have more severe consequences for long-term investments than those affecting the characteristics of buildings.
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SUSTAINABILITY
The challenge of current real estate developers and managers despite of technology and globalization are to adopt greener business practices in all regions of the world, at all stages of economic development.
Recent research suggests that commercial office buildings with higher levels of energy efficiency or sustainability indeed achieve higher rents, occupancy rates and sales prices (Lyons et al., 2013; Pivo and Fisher, 2010; Fuerst and McAllister, 2011; Devine and Kok, 2015).
Factors driving the broader sustainability-related trends in commercial real estate are tenant demand, green certification, regulatory requirements and extreme weather events.
Thus, sustainability is becoming a fundamental issue for commercial real estate owners, investors and renters, affecting long-term value generation and short-term profitability.
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Cu
rren
t ch
all
eng
es
• No incentives and rewards for industry best practices Recognition
• Poor understanding on value proposition & definition Awareness
• No proper financial model for organisation Financial
• Lack of skill & competent personnel in current market Human Capital
• No standardisation of practice and benchmarking information
Performance Measurement
• Poor governing act, guideline or regulation for professionals Regulations
• professionals do not have a platform to voice concerns Common Voice
• Integrated property software IT Application
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Why Property Management should be regulated –
• To protect public interest in terms of:-
– Health and safety
– Public fund administration
– Accountability
• To ensure independence, transparency and corporate governance
• To provide recourse for action by public for mismanagement and negligence
WHY PROPERTY MANAGEMENT SHOULD BE REGULATED?
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The United States of America
• In the US, most of the states require a license to manage properties issued by the State Department of Real Estate e.g. Tennessee Real Estate Commission, California Department of Real Estate etc.
Peoples Republic of China
• China has Property Management regulation under the Department of Housing & Real Estate.
Singapore
• In Singapore, majority of the Property Managers are members of the Singapore Institute of Surveyors and Valuers.
REGULATIONS IN OTHER COUNTRIES
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WHY PROFESSIONAL PROPERTY MANAGERS
• They have tertiary education from Universities recognised by JPA/LAN on Property Management
• Over 420 graduates in Property Management annually from local Universities :
- Universiti Teknologi MARA – Advance Dip in Estate Management, BSc of Estate Management (since 1971)
- Universiti Teknologi Malaysia – B. of Surveying (Property Management), B of Science (Property Management), B of Science (Real Estate Management) (since 1978)
- Universiti Malaya – BSc of Estate Management (since 2001)
- Universiti Tun Hussein Onn – BSc of Real Estate Management (since 2006)
• The Board also recognizes 92 Undergraduate Degrees from various overseas universities.
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WHY PROFESSIONAL PROPERTY MANAGERS • These degrees qualify us to render services relating to real estate which
includes Property Management, Estate Agency, Consultancy and Valuation.
• After obtaining the degree, registrants will have to undergo 2 years of training and pass a test of professional competence which includes Property Management.
• Continuous Professional Development of 10 hours per annum in order to remain registered.
• Professional Property Managers are eligible for Professional Indemnity Insurance whereas unlicensed Property Managers are not covered
• Registered Property Managers who err are subject to disciplinary actions and may even face disbarment from practicing.
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WHAT THE BOARD OF VALUERS HAVE DONE TO ADDRESS THE PROBLEMS • The Board has implemented Malaysia Property
Management Standards which is mandatory for all Property Managers – lauded by the Housebuyers ‘ Association & the Public.
• The Board through the registration and regulation of
Property Managers, has made it compulsory the need to have Client’s Account as well as Professional Indemnity Insurance as part of the annual renewal of practice certificate to all practitioners. Anyone who does not fulfill this requirement will not have his license renewed.
• The Board has also made Police Reports against all those
who have infringed the Act. In at least 1 case, the High Court has ruled illegal Property Management Firm guilty of an offence under the Act.
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MALAYSIAN PROPERTY MANAGEMENT STANDARDS Standard 1 : The Property Manager Standard 2 : Appointment of A Property Manager Standard 3 : Handing Over/Taking Over of Property Standard 4 : Building Management Standard 5 : Maintenance Management Standard 6 : Financial Management Standard 7 : Administrative Management Standard 8 : Insurance Management Standard 9 : Health, Safety & Emergency Management Standard 10: Tenancy/Lease Management Standard 11: Facilities Management Published by:
The Board of Valuers, Appraisers And Estate Agents, Malaysia www.lppeh.gov.my Tel. 603-2288 8815
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BILL
gazette
—INTRODUCTION :The Board has established a Task Force to ensure the
smooth implementation of the Registration of Property Managers in the
new Register of Property Managers.
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BILL
gazette
—INTRODUCTION :The Board has established a Task Force to ensure the
smooth implementation of the Registration of Property Managers in the
new Register of Property Managers.
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Reasons Lack of care for public safety – poor maintenance
Embezzlement of Fund – breach of trust
Charging unreasonable fees for services by developers’ service arm
Monopoly by the developers on provision of services and charges
Manipulation of accounts by interested parties – not audited
Tenancies/contracts given to related parties without getting the best price – conflict of interest
Practice of Property Management by unqualified people with dubious background
Renovation deposit not refunded
No proper handing over
Creating a new register of property manager under Act 242
TO REGULATE THE PRACTICE OF PROPERTY MANAGEMENT
POINTS OF IMPORTANT
AMENDMENTS
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CRITERIA 1. QUALIFICATION
2.COMPETENCY 3. INTEGRITY
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REGISTER OF PROPERTY MANAGERS Description Criteria
1 Qualification
SPM Certificate Diploma Other
Diplomas
Degree Other
Degrees
Recognition SPM,
MCE O-
Level or
equivale
nt
Recognized
by BOVEAP
Recognized by
BOVEAP
Recognized
by BOVEAP
Recognized by
BOVEAP
Recognized
by BOVEAP
2 Course
Discipline
Full
Certifica
te
Property
Mgmt.,
Facilities
Mgmt.,
Building
surveying
Property Mgmt.,
Facilities Mgmt.,
Building
Surveying, REA,
Quantity
surveying,
Architecture,
C&S engineering,
M&E engineering
Architecture
Law and
others
Property Mgmt.,
Facilities Mgmt.,
Building
Surveying
Quantity
Surveying,
Architecture,
C&S engineering,
M&E engineering,
REA
Law and
others
3 Minimum
Experience
8 years 6 years 3 years
5 years 2 years 4 years
REGISTER OF PROPERTY MANAGERS Competency verification:
1. Past Property Management Experience
a. Experience at Managerial level
b. Areas of experience in at least one area in:
i) Financial Management, and
ii) Building & Facilities Maintenance Management
2. Declaration of: a. No police record
b. No cases of mismanagement
c. No breaches of fiduciary duties
d. Not blacklisted by COB
e. Not found guilty by Strata Tribunal
f. No disciplinary action by BVAEP
REGISTER OF PROPERTY MANAGERS
3. Area of Experience:
PM experience in at least one (1) sub-area in Financial Management and at least one (1)
sub-area in Building & Facilities Maintenance Management
Financial Management: (a) Keeping of proper accounts (b) Debt recovery measures (credit control measures) (c) Insurance renewal covering all possible risks (d) Insurance claim procedures & application of claims
Building & Facilities Maintenance Management: (a) Proper maintenance & repairs of building facilities & M&E plants (b) Proper procurement process & full tender process (c) Management & control of renovation contractors & workmen (d) Management of tenancies and facilities (e) Convening & facilitating general meetings for JMB and MC
4. Letter from employer to confirm the PM experience
REGISTER OF PROPERTY MANAGERS
After “Window Period”
After the window period, persons wishing to be registered property managers shall comply with the following:
(i) Possess a degree qualification recognised by the Board
(ii) Must undergo at least two (2) years continuous training and experience under the supervision of a registered property manager
(iii) Submit Record of Experience in a Work Diary and Log Book
(iv) Upon completion of the minimum two (2) years continuous working experience, applicants shall pass the Test of Professional Competence (TPC)
REGISTER OF PROPERTY MANAGERS Responsibility of Registered Property Managers
1. Comply with the Act, Rules, regulations and the Property Management Standards
2. Practice with honesty and integrity
3. Deliver his services professionally and observe the professional ethics and Code of Conduct
4. Maintain high standards of his profession to protect the public against fraud, misrepresentation and unethical practices in property management
Penalties
1. Cancellation of registration
2. Suspension of registration
3. Admonishment
4. Admonishment and fine not exceeding RM10,000
5. Fine not exceeding RM25,000
6. Publish the conviction in newspaper or any electronic media
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Sr Ishak bin Ismail, FRISM, MRICS, MPEPS
Chairman of Property Management Practice Committee of Board of Valuers, Appraisers, Estate Agents and Property Managers
[email protected] 012-2276484/0392848884