The Missing piece in Indian real estate

Portal & Companies / Agents who facilitate Flats for Buying,Selling,Renting - Check.

Companies that provide Analytics on Real Estate - Check

Companies that do Facility Management - Check

Companies that do Property Management - Check

Companies that do a Structural Audit - Check

Companies that provide IoT, Boombarrier, Biometric, CCTV etc. - Check

Companies that provide Security - Check

Companies that do end to end Accounting - Check

Full fledged ERP to Manage an Apartment Community - Check [?adda.io?- the best of the lot ?? ]

Self Managed Owners Associations ( OAs )- Check

So what is missing? : Owners Association Management Companies ( OAMs )

Curious what an OAM is - Read on.

Perhaps a decade back Apartment Communities could easily self manage themselves. Nowadays the kind of facilities the builders provide are mind boggling - in today's Apartment Buildings you will find the same facilities that are in a 5 star hotel. Not only that the size of the Apartment Complexes have gone up tremendously. In 2006 Prestige Shantiniketan launched in Bangalore with 3000 units - and our jaws dropped seeing the sheer size of this proejct. Now 3000 units has become the norm. Recently I heard of a project with 20,000 units.

This is as big as running a Medium to Large Sized Business. Managing such large projects needs a team of full time Experts. The MC volunteers have a day job and in the weekend meetings they are inundated with numerous issues and decisions to be taken.

The MC team outsources the Facility Management, the Housekeeping, Security, Accounting etc. But the MC remains heavily involved in the vendor management. Apart from managing these vendors - the MC also manages the operations of an Owners Association - Budgeting, Cost Optimisation, Revenue Augmentation, Legal Compliances, Purchase Management, NOC for New Sale or Rent, Supervising new Initiatives and Projects etc. . It is an endless list.

Imagine if the above chores can be outsourced to a company - an Owners Association Management Company.

The Management Committee - or the Board - now can focus on approving Decisions suggested by the OAM, reviewing Monthly Reports, presenting at the AGM etc. If they have the bandwidth they can Strategise long term projects that benefit the Property. Let's say they want to install Solar Panels to reduce Electricity bills. They can have this as one of the projects and the OAM can take over - get bids from vendors, evaluate them and present top 3 quotations to be selected by the Board. Once the project gets kicked off - the OAM can oversee the project and give weekly or monthly updates to the board on the progress of this project.

From Operations to Strategy

The precious little time of the OA gets utilised on Strategy rather than on Operations. The Operations is outsourced to the OAM. This also attracts bright minds to the Management Committee - the busy bees who are already running successful companies - their expertise and vision can be used for the betterment of the Apartment Community.

Outside India, in Dubai, Singapore, Mauritius, Australia, US - there are these OAMs to whom the OAs outsource their work - and the MC - or the Board as it is called - oversees the work through periodic meetings and reports from the OAMs.

There is lot of win-wins here. The OAMs can have a common team across OAs - for instance - they can have a legal expert team, accounting expert team etc - and they can advise multiple OAs. Also over a period of time these OAMs evolve their own processes for better efficiency and cost saving - which they can pass on to the OA.

This also creates new Employment opportunities for those specialising in the Built Environment.

Is there a market in India? Yes. ADDA is lucky to have got some of the early adopters in OA and we can connect you to them. Yes, they will pay for a service like this.

There are 8 Million Household Units in US managed by HOAs ( Housing Owners Associations ) managed by 8000 OAMs.

India has 4.5 Million Residential units that were marketed and launched in the last 15 years.

Right now, as on 2021, this is a Blue Ocean Market in India.

Do we have these domain experts? Yes - quite a lot in fact. Whoever has served in the Management Committee is already an expert. Since this is a hands on job they would have got exposed to all aspects of running an Owners Association. We know of many passionate MCs who have become experts in this domain of Owners Association Management.

But will the Maintenance Costs go up if we outsource the OA Administration?

Yes in the short term, there will be an increase - which will be offset easily with the cost savings that can come from better running of an Apartment Community. And if the 5 star facilities the builder hands over - stays as 5 star facilities - apart from enjoying life in a well maintained community - there will also be a substantial increase in the rental and property value of the Apartment Community. Everyone wins.

The above is the pinned Tweet from San, CEO of ADDA - https://twitter.com/sanban. She is betting on the rise of OAMs in India.

Isn't this a business worth exploring?

Interested in starting an OAM? Do write [email protected][email protected].

If you have already started an OAM and want to list in ADDA Discover platform - do write to [email protected].