IQ Apartments

Prepared for:

C/-The Project Manager 85 Monaro Street Queanbeyan NSW 2620

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Introduction………………………………………………………………………………………………..3 Why Us…………………………………………………………………………………………………… 6 The Civium Approach…………………………………………………………………………… 6 Our Track Record………………………………………………………………………………...7 Our Team ………………………………………………………………………………………... 7 Our Experience …………………………………………………………………………………..12 Sophisticated Financial and Administrative Management……………………………………13 Our Systems …………………………………………………………………………………….. 15 Facilities Management …………………………………………………………………………..17 Insurances ………………………………………………………………………………………..18 Demonstrating Value……………………………………………………………………………..19 Primary Fee Structure …………………………………………………………………………….……. 20 Annexure A – Strata Management Services……………………………………………………..…..21 Annexure B – Case Studies…………………………………………………………………….……...25 Annexure C – Current Major Clients….……………………………………………………………….31 Annexure D – Testimonials…………………………………………………………………………….32 Annexure E – Draft Budget…………………………………………………………………………….33

At Civium, we believe that strata management is about people. About the relationships between people. For us, it‟s personal; we‟re all about relationships. Each client is an individual, and every property is unique.

We pride ourselves on not only delivering high quality services to our clients, but also making significant contributions to the community/industry as well.

Civium Strata People realises that Strata Management is more than just the bricks and mortar of a building, it is about creating relationships, being engaged with communities and people. That‟s why we put people in our name. Civium is Latin meaning a congregation of people/civilians coming together, our logo is a collaboration of dots which represents people coming together, in much the same way as the Romans congregated in colosseums. Each day we strive to be reach our vision of being the ultimate provider of property services, whilst living and breathing our values of teamwork, professionalism, integrity, commitment, success and respect because we know by doing this we will offer a superior level of service. Relentless in the pursuit of excellence, Civium Strata People often take the time to make sure that not only is our service of value, but it is efficient and effective in satisfying our clients‟ needs and we also work collaboratively with other service providers in the industry to achieve the desired outcomes that work for all. We believe this is why we are held in such regard by those who work with us, such as Executive Committees, service partners and contractors alike, as well as industry officials such as the Property Council of Australia. Our status as one of the largest and most trusted providers of strata management is built on a reputation as experts in management and our unrivalled approach to developer consultation. Every stage of a development‟s life-cycle from conceptualisation to construction and scheduled maintenance is thoughtfully planned for and our experts can assist in not only the ongoing management solutions but also in the early stages of development. We offer our developers a consultative approach to all developments, with expert advice and guidance on matters of compliance, project planning and can be present at development launch events to answer questions from potential purchasers. This kind of care and attention to detail results in many developers and Executive Committee Members, who build and live in extremely complex living communities, such as the NewActon precinct and the Trilogy Trust, choosing to work exclusively with us.

Innovation has always been an important factor in not only offering valued client services but also in operating a smooth business. Strata Management can be demanding at times, to not only cope with the demand but go above and beyond. To that end, Civium Strata People has set up a support network of highly skilled professionals across our maintenance team, arrears management team and client services team who are no more than a phone call or email away. These specialists provide a higher level of professionalism in the management we offer. Because of this structure our Strata Managers have the support of these teams behind them can focus on their proactive relationship and risk management. Not only this, our Strata Managers are genuinely happier and healthier, managing only an average of 40 buildings, once again allowing them to provide superior service by complete all necessary tasks in a timely fashion and reducing stress.

The Strata Community Australia (SCA) Awards are designed to recognise and reward those individuals and companies who make a significant contribution to the strata industry and community. Excellence is a journey and not a destination. To help with this journey the SCA Awards provides a means of measuring and benchmarking within our industry. At the 2014 ACT Awards Night, Civium Strata People were thrilled to be awarded 2014 Strata Management Business of the Year Award. This award is presented to the strata management business that makes a significant contribution to the strata industry by providing outstanding service to their clients, providing training to their team members and held in high regard by service contractors and all other stakeholders within the industry. Civium Strata People is extremely pleased with this recognition of our dedication to delivery of high quality service; innovation in product/service, high level of ethics and industry knowledge. This award is truly a reflection of our great team and the people that make our business what it is.

Civium Strata People are proud to support Camp Quality, raising over $75,000 for them in the last 18 months as well as engaging in volunteering and hands on programme assistance. “Partnering with Civium Strata People has been an incredible experience and one that will create a huge impact on the lives of children living with cancer in Canberra. The money Civium Strata People will raise helps to support and build resilience and optimism into the lives of kids affected by cancer and their families. Working with Civium Strata People has been an absolute pleasure, as the motivation of the staff to help has been incredible to be a part of.” Camp Quality – Partnerships Manager .

Outwardly the IQ Apartments appear as any mixed use development. However, the operational functionality is very different to that of a standard mix use development as seen in Canberra.

Incorporating the most up-to-date and sophisticated living environments ever built in Canberra with the sophistication of an energy management system for each unit in the complex.

The design principles offer not only flexible floor configurations it also offers the latest state of the art environment management systems (EMS). Each apartment has a state of the art energy efficiency management system, with air conditioning and hot water controls. This feature will be integral to the performance of each unit and will allow the unit owners to track their energy consumption, all done in real time. This will obviously be a huge selling advantage to potential purchasers both investors and live in owners. Also central to the energy efficiency of this apartment complex are the design principles incorporating outdoor areas and expanded living areas. This allows each resident to adjust their living requirements to suit each season. Every apartment is fitted out with prestigious fixtures, fittings and appliances. Security is ensured with electronically activated proximity access controls with key backups. Other features on this smart complex are the EO certified joinery, low VOC paints and water saving kitchen and bathroom fixtures with a high efficiency gas hot water system. All this adds up to an average EER unit rating of 6 Stars. This building is a mixed used development comprising residential units, commercial office/retail and restaurants. This mix of uses does present a range of operational concerns that, if not managed properly, can develop into long term management issues. For example the commercial waste areas in this building are small and located within close proximity of the residential waste collection area. This may cause issues with the residential tenants as the commercial tenants will co-mingle and from time to time use the wrong waste bins. Similarly the waste transfer rooms (that takes the domestic rubbish and recycling to the ground floor from the residential units) will also need to be managed closely so as these areas remain free of debris and clean at all times. Registration of plant and equipment is something of a hot topic in the ACT however this issue is currently with the ACT Government and still no closer to any legislative direction. However we believe it best practice for the developer to register all plant and equipment prior to the registration of the body corporate. Once the units plan registration is complete then it‟s also our recommendation to assign the plant and equipment registration to the executive committee. Fire safety is another onerous area of responsibility, and obtaining annual fire safety certificates is recommended with any new and cutting-edge development, especially the IQ Apartments. Again, this is not mandatory in the ACT, however as part of the ACT Building Act essential fire services have to be maintained to the relevant standard, of which is AS185. Complying with this standard brings with it best practice principles as well as the practicalities of having fire extinguishers and hose reels tested and maintained from year to year.

Civium Strata People take a dedicated and experienced team approach to our strata management team structure. Behind the Strata Managers we have a support team who undertake administrative, compliance, repairs and maintenance, financing and accounting services. This team compliments the Strata Managers and allows them to manage and provide advice and direction to you as the developer during the developer control period and ultimately to the Owners Corporation and the Executive Committee post the first annual general meeting. We also have our General Manager and Division Managers at the disposal of our team members and our entire team is supported by industry leading technology solutions to provide seamless and efficient services.

Essential Services Managers and Administration Team

Trust Accounts Team

Business Development Team

Facilities Management Team

Levy Arrears Team

Client Care Team

Insurance Renewals & Claims team

 Civium Strata People manage in excess of 13,000 lots across the ACT and NSW.  We manage properties of all sizes including complex marquee developments.  In the last 12 months we have achieved a 50% market share of the new developments in the ACT. Case studies of properties similar to IQ Apartments can be found in Annexure B.

Our team dedicated to IQ apartments are amongst the most experienced strata, facilities, accounting, and property professionals in the ACT. The dedicated IQ apartment‟s team have over 100 years combined experience in the delivery of business and property service solutions to Canberra clients.

Personnel

Position

Experience

Managing Director Responsible for the overall management of the Civium Strata People.

20 years

Doug O‟Mara Doug.Omara@civiumstrata.com.au

General Manager Responsible for the management and leadership of the strata management team, while working closely with (and mentoring) the divisional managers and providing them with management expertise in a professional and proactive way. Business Development Associate Rresponsible for assisting with the co- ordination and integration of new properties into the strata management department. Responsible for the management of the ACT strata management team by working closely with and providing management expertise in a professional and proactive way. Manage an assigned property portfolio, ensuring the company meets its client‟s expectations. Division Manager Member SCA (ACT)

15 years

Keith Woodman Keith.Woodman@civiumstrata.com.au

Shannon Rawlings Shannon.Rawlings@civiumstrata.com.au

2 years

5 years

Jarrod Smith Jarrod.Smith@civiumstrata.com.au

Insurance Manager Responsible for all strata insurance management including insurance renewals, relationship building with Insurance providers, quotes, policies management, claims, general administration and client service. Chief Finance Officer Qualified CA Rresponsible for overseeing all financial management matters and educating staff on proactive financial management for body corporates.

25 years

Garry Lee Insurance@civiumstrata.com.au

15 years

Kylie Harding Kylie.Harding@civiumstrata.com.au

Accounts Manager Rresponsible for managing the day to day accounts of managements as well as GST and BAS when required.

12 years

Rohan Jayasooriya accounts@civiumstrata.com.au

Facilities Management Responsible for adding value to managements in the area of facilities management and large scale building contract management. Maintenance & Compliance Manager Responsible for all repairs and maintenance work requests with an imperative to expedite them efficiently and cost effectively as well as manage he fire requirements, lift, asbestos, WH&S, sinking fund forecast reports for managements. Client Services Manager Responsible for the management of customer service, specifically to systematically contact all Civium clients To seek feedback on our customer service as well as deal with any issues that may arise. Levies & Debtor Manager Responsible for the efficient co- ordination and collection of levy monies and arrears for plans under management.

5 Years

Peter Majdandzc Peter.Majdandzic@civiumstrata.com.au

Maryse Dingle Maryse.Dingle@civiumstrata.com.au

10 years

Anne-Maree Palasrinne clientservices@civiumstrata.com.au

5 years

Rachael McClellan Levies@civiumstrata.com.au

3 years

Doug has over 20 years experience in Real Estate and Property having held Senior Executive positions over this period with CBRE, Colliers International and Knight Frank prior to establishing the Ray White Group in the ACT. In 2014, the Strata Management Department of the Ray White Canberra Group, became Civium Strata People, with a specific and dedicated focus on servicing clients living and working in strata communities. Doug leads the innovation and system implementation, new business and national expansion of Civium Strata People. In addition to Doug role as Managing Director of Civium Strata‟s national operations, he has an ongoing role as the leader of the broader Ray White group in the ACT which comprises a team of over 100 property professionals across the residential, commercial, retail and financial services sectors across a six office network.

Since establishing the group Doug has also been actively involved in a number of sales transactions, having sold in excess of $300 million and leasing in excess of 200,000 square metres of Canberra real estate and has also negotiated the sale of the highest priced residence in the history of the ACT.

He has received recognition nationally for his contribution to the Ray White Group.

Doug also holds a number of board positions and provides mentorship to Canberra based businesses outside of the Property Sector.

With over 15 years‟ experience in property, specialising in shopping centre management. Keith brings to the position of General Manager a wealth of industry skills and knowledge. This provides Keith with an in-depth understanding of the competencies as well as the practice in how to apply the management tools to leverage and strengthen the Civium Strata People team.

In addition to these life skills, Keith brings a wealth of knowledge around asset management, including facility and building management.

Having joined Civium Strata People as the GM in June 2014, Keith is combing his working knowledge of asset management with his human resource skills to deliver a cohesive and well thought through strategy for all Civium Strata People clients. This is particularly important for our developer clients‟, in particular Keith‟s ability to drill down, produce and deliver and comprehensive and sophisticated expenditure budget for new developments.

In the 5 years Jarrod has been with Civium Strata People, he has achieved a great things, resulting in promotion within a short period of time from Strata Manager to a Senior Strata Manager to Pod Leader - responsible for a team of 4 Managers, and more recently with a promotion to become responsible for 50% of the organisations department as one of two Strata Division Managers, along with a portfolio of high profile clients. Jarrod has the ability to translate and interpret relevant legislation that is consistently of a very high standard, whilst remaining unbiased through his understanding and application of the regulations to those who rely on him and the specific information that is required. Jarrod demonstrates on a daily basis, to internal staff and external clients, his clear and concise understanding of challenging situations in which Jarrod accomplishes a positive outcome for all parties involved through education, managing expectations and producing results that are in line with legislative regulations. Jarrod has acquired many skills and vast experience that he applies through understanding how the legislation should be operated, consequences of outcomes for external clients and the organisation whilst achieving successful results. Jarrod has been an integral part of designing and building procedures in assisting Managers within the organisation to become more efficient, provide a higher level of service to external clients and create improved methods to effectively be adopted by the organisation in current daily routine. Jarrod consistently manages the department and a high level of clientele through many challenging tasks simultaneously. Jarrod promotes within the industry the standard for levels of service through communication, pro- activeness and constant clear progression advice of individual tasks irrespective of their complexities. Jarrod has a natural ability to assist every situation with an approach of empathy, active listening, tailored content and communication that results in a style that proves positive for clients in achieving successful outcomes. As a Division Manager, Jarrod resumes the responsibility for taking on clients that have conveyed their concerns for different reasons which results in a higher level of sensitivity towards service standards, knowledge and the ability to effectively improve previous expectations to a point that secures future business through earned respect, rapport, trust and confidence in Civium Strata.

In recent years, Canberra has seen substantial growth in the construction of mixed use developments. These buildings comprise both residential and commercial/restaurant and retail units. This arrangement is relatively new to the Canberra region and carries with it additional challenges and obligations. Here at Civium Strata People, we have the skills and experience in our strata management and business development teams to fully understand these challenges and pride ourselves in our ability to understand and effectively manage these buildings.

How does this benefit you?

We have heavy involvement in the setup of the budgets whilst the building in still under construction. This allows us to fully understand the complexities of the building in terms of mechanical equipment, fire services, waste management, security as well as the other ‘soft services’ such as cleaning and landscaping. Another important factor of all mixed use developments is the completion of an Asset Register. Having a properly completed Asset register prepared upfront and available from the date of registration gives guidance and surety around sinking fund budgets in the coming years. It also provides a base line for all future sinking fund audits. Our experience extends across the ongoing management of many similar buildings across Canberra, and as such, means we understand and appreciate their complexities. We therefore have the additional capacity to provide recommendation, guidance and support on such issues as:

 Waste Management  Grease Traps  Commercial Fit-Outs  Access Control

 Ingress/Egress Control  LDA/TAMS Negotiation  Commercial Staff Management  Service Contracts/Asset Management  Split Contributions/Shared Services Budgets

Successful management of the above will ensure the body corporate operates effectively whilst meeting short and long term goals, particularly regarding the financial and structural integrity of the building and surrounds. Should the above be ignored or mismanaged, many additional problems will arise, for example; Waste Management: – Failure to manage this process will result in complaints, odours, health risks, penalisation and loss of amenity. Owners/Developers and Builders can confidentially place their faith in our organisation to relieve the stress caused by the numerous tasks and responsibilities we undertake and by drawing on our experience to identify practical solutions to every day challenges. Understanding and managing this building will require a more sophisticated and measured approach to strata management that can only be achieved through real time experience and engaging Civium Strata People to manage this development from the developer control period through to registration and beyond.

Budget

To prepare a fully costed administration budget requires a detailed understanding of the development complex. This not only satisfies the legislative requirements for sales contracts, it also alleviates any future angst around second year budgets. More often than not we see draft budgets‟ that have, not only fallen short of the legislative requirements to provide properly noted GST and unit entitlements, they also are deficient in identifying the detailed expenditure across the asset. Our team has the skills and industry experience to view and analyse the development plans and assign accurate expenditure.

For example we have identified the following operation requirements at IQ Apartments, not only for budgeting, for the asset register:

 Fire Services – sprinklers installed in basement 1, basement 2 and ground floor  Hot water pumps – maintenance post the DLP period

 Security – roller shutter motor, as well as the swipe card readers and intercom system  Management of the car parking allocation to the commercial and retail tenants  Management of the commercial waste areas, in addition to the management and collection of the

tenants waste from the collection points  Lift maintenance post the DLP period  Car park exhausts – maintenance post the DLP period  Landscaping maintenance

Sinking Fund budgets also form part of a properly costed asset plan. Our sinking fund allocation in the first year budget allows for a properly prepared and costed sinking fund report. This report is the base line for the property asset management plan, and works towards future-proofing the asset. We have taken the liberty of applying our knowledge and expertise in providing a draft budget and contributions schedule that includes some of the omissions identified in your existing budget. Please refer to Annexure E. Registering a complex building such as IQ Apartments is a daunting task, and in our experience we generally take the lead with developers, builders and solicitors in preparing all the documentation surrounding the registration and striking levies against the first year budget. As we have intimate knowledge of the budget process our internal processes allow us to set up the building in our system well ahead of time. This provides our administration teams with the necessary information to prepare the section 119 certificates, enter the approved budget figures and complete the draft house rules and inaugural minutes in readiness for the first annual general meeting. It‟s also at this time our skills and experienced teams are able to provide you with recommendations around the best possible way forward in managing the complex. For example with all mixed use developments there are always issues with:  Signage rights on the outside of the building  Use of company graphics and logos internally  Granting rights of access over easements  Interdependency between commercial/retail and residential tenants around noise, security and waste issues Our process post registration

We provide recommendations around the best ways to manage these issues prior to the expiry of the developer control period. This allows the developer to make informed decisions about the draft house rules in readiness for the first annual general meeting. In the ACT, once a development is registered as a Units Plan, it is necessary to put in place certain things for the establishment of the Owners Corporation and for the operation of the building in the following categories:

 Inaugural minutes and resolutions  Create UP file in Citadel Systems  Initial budget and corresponding levies  Initial financial statements  Owners Corporation Rules (previously Articles)  Bank accounts, ABN, TFN and other necessary accounts  Insurance

 Section 119 settlement certificates  Service contracts and agreements  Obtain handover documents from developer – warranties, plans, user manuals  Other general administration.

Civium Strata People will prepare the necessary documents that relate specifically to the ongoing management and operation of the Units Plan.

Introducing the Civium Citadel System

CSMS

CTM

CCP

COC

CIE

It is the Civium information technology platform, known as the Civium Citadel System (CCS) that sets us apart from our competitors and is a significant point of difference in the marketplace. The system comprises five core bastions that deliver a unique service experience to our clients. 1. Civium Strata Management System (CSMS) The back bone of the platform is our financial management software specifically developed for the strata industry. Not only does our system lead the way in both accrual and cash accounting, it allows easy integration and delivery of key documents, has streamlined document management and invoice processing and a comprehensive budgeting package. The system generates levies and processes invoices with ease giving the Owners Corporation the most efficient and effective strata accounting service in the marketplace. 2. Civium Community Portal (CCP) Our clients have full access to all information relating to their complex 24 hours a day 7 days a week no matter where you are in the world In the portal our clients have access to all of their financial records (EC members only), levy payment history, documents relating to the complex, house rules, articles of association, the Units Plan, and insurance certificates. Clients are also able to submit and track maintenance requests, pay levies online, and manage contact information. 3. Civium Invoice Express (CIE) With our web based invoice approval system our accounts team is able to view and process invoices accessible on any device at any time. The system has the functionality that caters for up to 4 external approvers from building managers to multiple committee members and provides a full audit trail of approvals, comments and rejections. 4. Civium Outbound Communications (COC) Our strata managers now have the ability and access to this system which allows instance communication to our clients in real time. This means that meeting minutes can be emailed at the

end of each meeting directly to the email list assigned to each property. Communication is the key to our business and real time communication is fast becoming the accepted standard in the strata management industry. With this software package we have:  Efficient distribution of correspondence such as levy notices, arrears, minutes, agendas etc.  Full audit trail available evidencing delivery to Aust post or via email.  Able to demonstrate delivery to an email gateway as well as confirm opening of email.  Automated print delivery in the event of email failure  Aim is to reduce arrears and delays in responding to arrears management.

5. Civium Task Management (CTM) The last component of the system is the one we most recently developed for internal task

management. Every task assigned to your strata manager is logged immediately following the AGM and each subsequent task that requires completion throughout the year is logged into CTM. Each complex managed by Civium Strata People can elect to have a report on the status of each task emailed to the Executive committee at the end each week or month. In the event a task remains un- actioned by your strata manager for a period of 30 days or more a report is then sent you the Strata Division Manager for their attention.

Never before has a Strata Management company provided this level of transparency and commitment to provide the highest level of service and accountability.

We offer facility management or building management services across our portfolio and we have demonstrated ability to deliver facility management services through our involvement with Nishi and NewActon South. Civium Strata People worked with the developer prior to construction to provide strategic advice on the transfer and granting of easements over the residential lots. In this context easements has the meaning of use and access to shared utility services. Ultimately the development consisted of 18 Blocks on a single Section, comprising 220 residential units registered as a single units plan. As an integral part of this units plan, a shared facilities and division of costs budget was prepared by Civium Strata People. This register dealt with the rights and other responsibilities of the various parties granted under the registered easements. Ultimately this list of shared facilities and division of costs schedule formed part of the contact of sale and listed the Lessee‟s permitted use of the said shared facilities. Post construction and throughout our management of this building, Civium Strata People receives weekly reports from the on-site facility manager in relation to service and supervision of contracts to ensure they perform to the levels and frequencies required for this building.

The list of facility management services we would provide to the executive committee at IQ Apartments would include:

 Building compliance and safety  Life-cycle maintenance strategies and implementation  Trades including electrical, air-conditioning, plumbing, carpentry, lift and fire services  Specialist maintenance  Grounds and gardens maintenance  Security services (both physical and electronic)  Pest control  Cleaning

Civium Strata People facility management offers a wide range of independent consultancy services that can support your facility management needs and incorporates existing contracts such as cleaning and gardening should those services be required.

Many organisations recognise that their FM operations aren‟t working efficiently, and can‟t identify the problems. Our consultants can analyse how your facility‟s non-core activities are managed and determine the best way to deliver them.

We consider where to best reduce costs, how to improve the quality of services and how to reduce your risk. Most importantly, by increasing certainty in your FM spend, we ensure you‟re not just reacting to daily needs, but are able to clearly plan for the future.

Our facilities management consulting services include:

Strategic reviews

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 Assessing FM procurement practices and managing procurement processes  Analysing asset portfolios, providing strategic asset management and planning  Advising on risk exposure  Helping to implement new FM systems and processes to improve service  Improving the sustainability of your operations  Analysis of utilities consumption and bench-marking

We list below the approach we would use for IQ Apartments:

 Assign a dedicated on site building manager with a support team consisting of a senior strata manager and senior facilities manager  Engage the in-house support services consisting of our dedicated teams for insurance, automated debtor collection, compliance, financial reporting  Partner with our sub-contractors and tradespeople for all service contracts to enhance and assist the overall management systems including developing an asset register, establishing and maintaining an inventory of spares, managing the preventative maintenance contracts and follow up where maintenance has not been performed  Enhance our relationships with business to business partners in relation to services to ensure they are performed (as a minimum) to the statutory levels of competency  Assess and recommend life cycle planning requirements across the property to minimise risk and impact on the sinking funds and/or operating budget  Work within and monitor compliance with the ACT Unit Titles (Management) Act 2011 Practically speaking this translates into the strata and facility manager inspecting the property each day, taking note of cleanliness, adherence by tenants to rules and regulations, lighting, repairs & maintenance and garden maintenance. Having the team on site also allows timely responses and action on all other unforeseen issues that will ultimately arise.

Level of insurance; coverage particularly in respect to Workers Compensation and Public Liability

Civium Property Pty Ltd is the holder of all insurance cover. Civium Strata People is party to that insurance policy and includes:  Workers Compensation  Professional Indemnity $10,000,000  Public Liability - $20,000,000.00  Products Liability - $20,000,000.00 in the aggregate

** Anywhere in the Commonwealth of Australia or New Zealand

Our approach to pricing of services and how we ensure value for money for clients

Pre registration of the owners corporation and during the developer control period we work with the developer/ builder to gain the greatest understanding of the operational requirements of the building and the plant and equipment installed. This involves meeting contractors on site who are providing quotes to service and maintain the plant and equipment. By visting and walking the site with contractors as often as possible gives the Strata and Building managers an intimate knoweldge of the site. Where possible we obtain three quotes from our service providers. We make our recommendations based on the best value for money and discuss our recommendation with the owners corporation before engaging the successful service provider. We only use pre-selected and approved contractors and tradespeople. Before we recommend a service provider they must undergo a compliance and professional standards check. This ensures that they adhere to our strict policy and service standards, and in the event they do not have the appropriate insurances/ licenses we do not engage them.

We also have a maintenance and compliance team whoe ensure all contractors meet our code of conduct before they are engaged to perform services for our Owners‟ Corporations.

Having a dedicated and focused management team assigned to the IQ Apartments will provide the best opportunity for our value for money proposition. The team will undertake a review of all service providers within the first 3 months of engagement. Our recommendations will always be based on achieving value for money and where possible we will make recommendations to this executive committee on our findings.

We have provided the below summary of our standard charges based on a complex of 237 commercial units for a 2 year contract.

Service

Charge Per unit (Inc GST)

Charge Per UP (Inc GST)

Totals* (Inc GST)

Management Fee *

$242.00

-

* $57,354.00

Note: * In Year 2, the base management fee would increase by 5%

Pursuant to our standard management agreement applied in the ordinary course of managing your Owners Corporation, the total of fees management fee is $57,354.00 (inclusive of GST) plus disbursements of $80.00 per lot per annum. All additional disbursements are outlined in Annexure A – Strata Management Services.

Day to day accounting functions Regular processing of payments including:

Included Service

Additional Service Charge

Additional Service

Review and quality assurance of all invoices

Liaison with Executive Committee for approval of payments and purchases

Preparation of payment and EFTs if required

Handling and resolving creditor queries

Input payments into accounting system

Regular processing of invoices and other receivables including

Preparation and distribution of quarterly levy notices

Input invoices and receipts into accounting system

Preparation of debtor report

Action to collect outstanding amounts including the application of any associated fees and charges

$125 Per hour

Management reporting Preparation of quarterly financial statements including:

Included Service

Additional Service Charge

Additional Service

Reconciliation of all bank accounts

Preparation of work papers to support each Balance Sheet item

Maintenance of Corporate Register and control access to corporate information in accordance with the ACT Unit Titles (Management) Act 2011

Completion of quarterly Business Activity Statement /recovery of GST offsets

$394 Per annum

Working with and facilitating external audit requirements if required

Financial reporting Provision of financial reports for inclusion in Executive Committee (EC) reports including:

Included Service

Additional Service Charge

Additional Service

Executive summaries indicating any trends or anomalies

Commentary on the Balance Sheet and Profit and Loss Statement

Reports on debtors, actions lists and cash position

Responses to queries and clarifying accounting questions

Liaising with the Executive Committee Treasurer and/or other EC members

Meetings Actively participate in the following meeting or related activity:

Included Service

Additional Service Charge

Additional Service

Prepare the agenda for and attend monthly Executive Committee meetings

Assist in preparation for and attend the Annual General Meeting and any Extraordinary General Meetings

Take minutes at meetings and prepare minutes for clearance and subsequently distribute them

Prepare financial and operational reports required to be distributed before or at meetings

Liaise as necessary with Executive Committee members and subcontractors

Annual Reporting Maintain appropriate records and prepare the following reports annually:

Included Service

Additional Service Charge

Additional Service

Financial statement including Profit and Loss and Balance Sheet

Preparation of the Annual Budget in conjunction with the EC Treasurer

Arrange for annual audits to be conducted if required

Distribute annual reports and budget to Owners

Insurance Provide the following services in respect of insurance:

Included Service

Additional Service Charge

Additional Service

Obtain quotes for the renewal of insurance policies

Arrange insurance evaluations as required

$25 Per arrangement

Prepare, lodge and manage routine insurance claims

Submit quotes to the Executive Committee and renew insurance according to instructions

Declare commissions associated with the insurance and any other contracts and agreements entered into

Support Provide support to the Executive Committee particularly:

Included Service

Additional Service Charge

Additional Service

Assistance responding to possible breaches under the Rules

Managing access arrangements including arranging the issue of

$33 Per

card/key

swipe cards and fobs and recording the issue of these including a key register

Prepare certificates for issue as required under the Unit Titles (Management) Act 2011

As per the Regulation

Additional services It is anticipated that the following services will not be included in the management fee but rather will be accounted for and invoiced separately: Access fees and fees incurred in the preparation of other certificates required under the ACT Unit Titles (Management) Act 2011

Included Service

Additional Service Charge

Additional Service

$55 for room hire

$220 for a basic information pack

Fees incurred in connection with the recovery action for outstanding levies are to be charged to the unit owners and, following recovery, retained by the Agent with any interest to be credited to the Owners Corporation

$44 per 1 st & 2 nd notice $88 per 3 rd & final notice

Abnormal activity related to building defects and builder issues are to be charged at the agreed hourly rate

$105 Per hour

Direct expenses such as postage, stationery, IT, bank fees, telephone calls and other disbursements are to be charged at cost

As agreed

Charging Rates It is anticipated that fees associated with the Strata Management function will be provided and agreed on the basis of a standard management fee per unit per annum inclusive of GST. This charge will include compensation for:

Included Service

Additional Service Charge

Additional Service

Quarterly Business Activity Statement

Annual income Tax Return

Printing, postage, stationery and telephone

$62.27 Per unit per annum

Letter drop charges

$105 Per hour

$6.30 Per unit per annum $6.30 Per unit per annum

IT fees

Document storage

Additional work rates Additional work outside the contracted scope of work may be required from time to time. It is therefore requested that these rates, hourly inclusive of GST, be identified and agreed for the following personnel:

Included Service

Additional Service Charge

Additional Service

Business manager

$125 Per hour

Senior Strata manager

$125 Per hour

Strata manager

$105 Per hour

Administrative staff

$75 Per hour

Additional service rates We anticipate additional services may need to be provided from time to time and request that the rates inclusive of GST be identified and agreed for:

Included Service

Additional Service Charge

Additional Service

Inspection of Body Corporate Register

$55 Per room hire

Preparation of Unit Titles Certificate

As per Regulation As per Regulation

Preparation of Unit Titles certificate with minutes

$44 per 1 st & 2 nd notice $88 per 3 rd & final notice

Recovery of levy arrears (the charge applied for each recovery action including the calculation of interest)

Matters of integrity The Owners Corporation requires the Strata Manager to:

Included Service

Additional Service Charge

Additional Service

Declare conflicts of interest

Maintain appropriate fidelity insurance including both public liability and workers compensation insurance

Declare and return to the Owners Corporation any commissions received unless otherwise agreed with the EC

Have a corporate statement on ethical conduct and fraud prevention plan

The Apartments 19 Marcus Clarke Street Canberra

Key Responsibilities:

 Provide advice to the developer in relation to compliance of new legislative requirements  Preparation of compulsory documents necessary for compliance with the Developer Disclosure Obligations  Consult in relation to practical implications of building design and operation  Procure service agreements in relation to ongoing building operation  Preparation of budget forecasts for operational and capital expenses of the building  Consult with key stakeholders including finance partners, agents, purchasers and solicitors  Establishment of the Owners Corporation and preparation of inauguration documents  Assist with the settlement of purchased properties at instruction from solicitor & developer  Implementation of strategic and operation plan following completion and settlement  Assist new building owners with transition of responsibilities The Apartments at NewActon is a development of local and national significance. The mixed use residential & commercial building incorporates 190 strata titled units, predominantly apartments, with some ground floor retail and office use. The nature of the building itself was complex in design and service requirements. Unusually however, the project was delivered as a staged development as part of a single Units Plan. At the time, a staged development under one Units Plan was reasonably uncommon in the ACT. This caused an increased degree of complexity surrounding planning and certain sequencing sensitivities in relation to budgets for building operations and levying of units settling in each respective stage at different times. The staging of the development was further complicated due to each stage forming part of a single building structure. Ground floor level units up to level 4 (known as the „podium level‟) were completed and registered as part of the first wave, thereby creating the legal entity of Units Plan 3488, while all following units on subsequent floors remained part of the uncompleted development. This part of the building continued to be a construction site with certificate of occupancy being issued some months later, followed by legal title being issued enabling settlement.

Challenges & Learnings (overview)

A great deal of thought was dedicated to balancing the need for trades access to

the construction zone via the thoroughfares of common property registered to the Owners Corporation, against the need for quiet use and enjoyment of the property by its new owners. Further issues relating to noise, cleaning and damage arose which required a high level of management. In addition to the complicated staging of the building completion, the project commenced shortly after wholesale sweeping amendments to the Unit Titles Act and other consequential amendments of legislation occurred. Materially for this development, it became necessary for the developers to provide a much higher level of disclosure than had ever previously been required, in relation to the operation of the Owners Corporation. At the time there was little to no experience within the marketplace to deal with the new disclosure obligations, and many of the consequences for failing to comply would have been severe, while others remained uncertain.

Key Benefits / Outcomes

As one of the first complicated developments to launch following the increased and uncertain disclosure obligations, the process undertaken provided an extremely valuable template for future projects in relation to planning and forecasting for Strata Titled developments.

The success of the activities undertaken are evidenced by a number of points:

 Nil occurrences of disputes arising from the disclosure documentation provided at the outset of project launch  Accuracy of operational budget forecasts to within an insignificant margin of error  Replication of the process undertaken with this project as applied to further developments across the market  Broad acknowledgement and acceptance of the process undertaken by industry peers (conveyancing professionals, agents etc)  High level of education / exposure of the process across the industry

Kingston Foreshore Eastlake Parade & Trevillian Quay, Kingston

Key Responsibilities:

 Provide advice to the developer in relation to compliance of legislative requirements  Preparation of compulsory documents necessary for compliance with the Developer Disclosure Obligations  Consult in relation to practical implications of building design and operation  Procure service agreements in relation to ongoing building operation  Preparation of budget forecasts for operational and capital expenses of the building  Consult with key stakeholders including finance partners, agents, purchasers and solicitors  Establishment of the Owners Corporation and preparation of inauguration documents  Assist with the settlement of purchased properties at instruction from solicitor & developer  Implementation of strategic and operation plan following completion and settlement  Assist new building owners with transition of responsibilities  Assist with commercial unit owners / tenants in relation to fit-out & signage approvals  Assist with approvals necessary for liquor licencing requirements  Troubleshooting with precinct issues in relation to commercial uses e.g. waste management Kingston Foreshore is a master planned precinct encompassing a number of standalone developments delivered by a range of Canberra‟s best known property groups including Doma, Englobo, Amalgamated & CIC. Although development continues within the precinct and will do so for many years to come, many projects have completed and the area is underpinned by the success of these landmark residential and commercial buildings to date. Borrowing from the lessons learned with The ApARTments at NewActon, it was necessary to disclose information pertaining to the funding and operation of the future Owners Corporations from the outset of launching the respective projects. Although fundamentally the method and processes involved in order to comply with the developer disclosure requirements was now well understood, the Kingston Foreshore represented an added layer of complexity due to the nature of the competing uses of commercial retail, office and residential apartments. While this combination is not in and of itself unusual, the developers of Dockside (Doma), Aurora and Element (Englobo) sought to create further separation of obligations and rights for each type of use than is provided by default within the Unit Titles Act. By reviewing special provisions within the legislation, and in consultation with key consultants of the developers design and legal teams, we were able to establish separate funding obligations for commercial retail units (and office units in the case Ray White has been involved in a majority of these projects both in relation to Strata consulting as well as commercial sales and leasing.

Challenges & Learnings (overview)