Broadclose Management Company

As a homeowner on the Broadclose development in North Cornwall, Vanstone hadn’t intended to get involved with the administrative side of the estate. However, that changed during the AGM in the autumn of 2019, which underlined widespread frustrations with the property company managing Broadclose at the time.

“The AGM wasn’t good,” says John, “I felt unheard but I was challenged to become a director if I was so unhappy about it!”

He did exactly that, joining fellow homeowners, Christina Tielenburg and Andrew McFadden, as a director of what is effectively the residents’ association.

Their first move was to take back control from the property management company, which they decided would give them greater flexibility in tackling the long-standing issues.

Getting the right support

With 173 properties at Broadclose, all residents pay a charge to cover the services across the estate, which primarily includes the maintenance of a grey water system, as well as the upkeep of the shared grounds.

As a large estate, around two-thirds of the houses are affordable homes for rent or sale through the Westcountry Housing Association and the Guinness Trust, while the remainder are privately owned homes. One of the priorities is ensuring that the service charge is affordable while covering the costs of the estate. As John notes: “There is a fine balance between spending people’s money and maintaining a necessary standard.”

It has been apparent that the estate had been underfunded for a while, and a combination of debts and irregular payments had contributed to issues with cash flow.

Cutting ties with the property management company brought an immediate cost benefit. It also meant that the ‘onerous’ responsibilities of collecting the service charge and administering the accounts were now squarely on the directors’ shoulders.

They turned to Simpkins Edwards for support, who has previously acted for Broadclose for several years before the specialist management company had come on board.

Jo Tope, partner at the Simpkins Edwards Holsworthy office, has helped to streamline their processes, including dealing with their debt. This had escalated under the property management company, with a sense that they had ‘no real teeth’ or persistence in resolving the issue.

“Jo has been very, very good,” says John, “She is proactive and has managed to clear almost all the outstanding debt.”

Alongside this, the team at Simpkins Edwards has moved one of the housing associations to monthly invoicing to improve cash flow.

They also send quarterly management accounts, which John and the other directors find particularly useful: “Jo provides us with the information we need as a company. It’s well explained – she doesn’t just send the accounts, she sends detailed notes.”

These show how costs and income are fluctuating, as well as highlighting any matters of interest and concern, giving a much clearer picture.

“We can see where we are and where we are going,” John explains.

Regaining control

Working with Simpkins Edwards also provides the transparency that had been lacking previously. “Before that, it was a bit of a dark art as far as I could see,” says John.

The company is essentially a not-for-profit, existing to cover the costs of the estate that all the properties benefit from. As directors, they appreciate the oversight and advice Simpkins Edwards offers. This gives them the confidence that they are meeting their obligations as directors, while also allowing them some distance from the finances.

“Everything is easy to deal with,” says John. “Simpkins Edwards takes care of the time-consuming elements of the accounts and has set up processes to liaise with third parties, such as the solicitors appointed for house sales.”

With a much tighter rein on expenses and a better understanding of the financial situation, previous problems such as overspending, accruing debt and depletion of reserves have been brought under control. Broadclose is able to plan for maintenance more effectively and have a strategy for managing the costs of the estate going forwards.

Crucially, they have all the information they need, when they need it.

John finishes to say: “I like the communication from Jo, she is very responsive. And we’ve never had to chase – I think that’s unusual!”