Understanding Management Rights Language/Terms
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When looking at Management Rights you will need to understand most of the commonly used terms by the Management Rights industry.
Here is a list of some common phrases you may encounter and a brief reference.
| Salary or Remuneration
Body Corporate Salary/Remuneration |
Income the manager receives for completing the duties described under the caretaking agreement with the body corporate (Caretaking Contact)
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| Net Profit | Before tax business income adjusted for sale purpose, which has allowances for industry add backs.
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| Agreements | Caretaking and Letting Agreements you engage with the BodyCorporate.
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| Caretakers Duties | Jobs you are required to do as part of your responsibility as the Caretaker, these are outlined in the Caretaking Agreement.
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| On Title | If the office is On Title means you own the freehold to the office, as opposed to an exclusive Use area.
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| Letter of Offer / Offer & Acceptance | Used to negotiate the sale price plus terms and conditions to appear in the sale contract.
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| Contracts | Drafted by the Agent/Solicitor to industry standard, usually approved by the buyers and sellers solicitors prior to signing.
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| Verification (Sometimes called) Finance Due Diligence | Financial Verification of the business figures, this is done only after we have a signed contract, done by the buyer’s specialist management rights accountant.
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| Due Diligence | Legal Due Diligence of the Caretaking & Letting agreements and body corporate records is done by the buyer’s specialist management rights solicitor.
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| Body Corporate | Consists of a group of owners from the complex but managed by a separate company known as the Body Corporate Managers
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| Committee Approval
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The last step of a buyer’s contract is when the incoming manager is approved by the committee at meeting. Also refers to committee voting on any issue raised by members including the manager, most commonly done at a meeting.
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| Unconditional Contract
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The stage during the contract period when the key conditions of Financial Verification, Legal Due Diligence and Finance Approval have been satisfied.
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