Join Australia's most dynamic and respected property investment community

Multiple shops & apartments to strata title or leave on one title

Discussion in 'Commercial Property' started by joca, 16th May, 2016.

  1. joca

    joca New Member

    Joined:
    16th May, 2016
    Posts:
    3
    Location:
    perth
    Hi everyone I am new here great to have a forum to discuss property questions hopefully someone can help me out.
    My family own 3 existing shops which are on 2 titles, we own 2 propertys next door also on 2 titles which we have started to build 3 shops with 3 apartments above. Part of the council approval to get this new development happening is entire site needs to be amalgamated before completion of the build. As there is common parking areas front and back.
    If we have no intention of selling anything for the next 5 to 10 years at least is their any advantage of strata titling now? Family members will be living in the apartments. All Shops will be leased out.
    Part of the problem the older shops share common toilets with no disabled toilet so probably will need to be upgraded to get them strata titled which we don't really want to do.
    Once everything is amalgamated on one title does splitting up outgoings become a problem ?
    Thanks in advance
     
  2. DaveM

    DaveM Adelaide Buyers Agent & KFC Strategist Business Member

    Joined:
    14th Jun, 2015
    Posts:
    2,098
    Location:
    Sydney & Adelaide
    Can you do a community title instead with common areas being managed by a community association? The strata plan then contributes a proportion of maintenance and upkeep via a payment from the owners corporation, levies for that side include the association costs. Leave existing shops as is, and strata the new build for valuation purposes.
     
  3. Scott No Mates

    Scott No Mates Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    5,536
    Location:
    Sydney or NSW or Australia
    Create two separate stratum title lots one for commercial andone for the residential. Each can then be strata subdivided as required as well as maintaining development rights.

    What's your beef about creating or upgrading facilities? At present you disenfranchise a % of the prospective tenants & users 4-5 m2 of toilet won't make a development unfeasible, you have more serious issues if it will.
     
    sanj likes this.
  4. sanj

    sanj Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    2,137
    Location:
    Perth
    Agreed, seems a case of penny wise pound foolish imo
     
  5. Scott No Mates

    Scott No Mates Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    5,536
    Location:
    Sydney or NSW or Australia
    Consolidation and subdivision are two distinct steps. You must consolidate to one title then subdivide into separate lots and common areas. Seek legal, town planning and specialist surveying advice - spend a few $ to get it right rather than creating an expensive mistake.
     
  6. joca

    joca New Member

    Joined:
    16th May, 2016
    Posts:
    3
    Location:
    perth
    Hi thanks for the replies yes we must amalgamate the site first before strata title, the existing shops have tenants in them so any work to upgrade the shops will effect their business which we don't want to do at this stage. Another problem we have is the front of the whole site has a 10m road reserve part of the conditions of amalgamation this road reserve needs to be on a seperate lot which brings all sorts of problems by itself.
    Basically we are not property developers and weren't prepared for some of the issues and costs we have encountered.
    Basically at this stage we just want to get to stage 1 and amalgamate the site as I said before we don't need to sell anything so not sure by doing a strata if its just going to complicate things and something that can be done further down the road.
    Our current surveyor although very experienced is semi retired I'm going to try to find another who can give me another opinion.
     
  7. sanj

    sanj Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    2,137
    Location:
    Perth
    you should find a good PM/development manager/firm to handle this project then. ultimately you're talking about something worth a fair few million dollars and it doesn't appear that you're quite sure what to do.

    what you don't want is that even if you end up finishing the project you either built something the public doesn't want/like or you paid too much due to inefficient design/engineering or that the builder took you for a ride whatever.

    you've got a big asset there potentially getting a lot bigger, get someone in to help since it seems like cash isn't the issue, experience is
     
  8. sanj

    sanj Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    2,137
    Location:
    Perth
    ah just saw that you've started already. I'd still be inclined to speak to someone experienced and acting in your best interest and get specific advice re your issue and also see if there are any glaring issues easily remedied now during the build
     
  9. joca

    joca New Member

    Joined:
    16th May, 2016
    Posts:
    3
    Location:
    perth
    Thanks sanj sorry for the late reply been away yep to late to stop now not really sure who to speak to ? we have already spoken to our surveyor, accountant, real estate agent (commercial), everyone gives a different opinion our biggest issue is the amalgamation because there is a road reserve at the front by us developing and needing to amalgamate the land this has triggered conditions by the WAPC. Road reserve needs to be shown as a seperate lot for later acquisition (if ever), existing water meters need to be moved out of road reserve basically its become a big headache. Currently this road reserve is used for parking only for the existing shops.
    According to our surveyor this separate lot for the road reserve becomes a problem when creating strata title. I have written to planning minister but doesn't look like we can change their decision.
     
  10. Omnidragon

    Omnidragon Well-Known Member

    Joined:
    17th Oct, 2015
    Posts:
    414
    Location:
    Victoria
    Strataing may give better financing flexibility, and potentially reduce land tax if held in different entities?