Apartment management: Before the builder hands over

When residents take over their apartment's or layout's maintenance from the builder, many things go wrong! This two-part guide helps you keep track of the critical legal, bureaucratic and day to day tasks.

Taking possession of an apartment is so often fraught with its own challenges (late handover, defects within the apartment) for the individual apartment owner, that more often than not building-level issues tend to be ignored.  Further, during the Builder-provided warranty period, occupancy normally tends to be very low, making very few people available for handling building-level issues. 

Caveat Emptor: Latin for ‘Let the Buyer Beware’.

While first-time associations do cover obvious issues (like major defects / incompletion in building construction, basic documentation, handover of maintenance corpus), many other issues are ignored, either due to a lack of awareness or resources or both.  These, however, do come up a few years down the line, often necessitating the Association to spend a large amount of money with obviously, with no support from the builder to rectify the same. 

A typical multi-storied apartment building (or complex of many buildings) is a collection of multiple aspects, each of which is integral to maintaining a proper quality of life for the Residents. The following table describes the typical components of these systems.

Apartment management functions

While the first two areas – legal and finance – tend to get the maximum attention from first-time associations, for obvious reasons, many areas within the other amenities tend to be ignored or ‘left for later’.

Wisdom of hindsight

Here’re a few of the issues we faced in my apartment building that could have been avoided, had we done a formal, proper handover from the builder.

Missed during Handover

Result

Cost Implications

Fire system check

Ineffective and malfunctioning fire system (no alarms / wrong alarms) – detectors installed in isolation / missing wiring, faulty detectors and woofers, etc, unfilled extinguishers, blocked hydrants, etc.

Rs 2 lakhs plus for testing, rectifying and verifying the entire fire system

Electrical Equipment Audit

Audit from BESCOM uncovered that installed load was more than sanctioned load – as a result, we had to pay a penalty and back charges (due to a differential tariff rate) and get a revised sanction for the higher load

Rs 0.5 lakhs for penalty and back charges

Rs 1.25 lakhs (estimated) for increasing sanctioned load

Evidence about RWH compliance

Unknown status on RWH compliance – while it is known by word-of-mouth that the rain water from the terrace drains into a nearby recharge well, there is no documentation supporting this. As a result, to meet statutory compliance, the Association has to implement RWH, bearing the cost on its own.

To be determined. Would range between Rs 0.6 lakhs – Rs 2.0 lakhs, depending on option chosen.

Missing components of terrace – per sale deed, builder had promised a ‘clubhouse’ on the terrace, which wasn’t delivered

The Association had to spend its own money to make the terrace area more usable

Rs 1.5 lakhs

Formal, Documented Handover

Needless to say, such misses at the time of handover may prove costly to the Association, further down the line.  The Builder is liable to rectify any defects during the warranty period.  Once the warranty period is over, not only is it close to impossible to get the Builder to act, it is even difficult to get any information or even a response from him.  Therefore, it is imperative that Associations try and get as many issues resolved during the warranty period itself. When that is not feasible make a formal statement of issues found, rectified and pending, to which the builder can be held accountable in the future.

 

The formal handover also includes proof that the current of systems in the apartment complex is working as per design, documentation pertaining to the system and certifications / other statutory documents, if any.

Handover Procedure.  A good way to ensure that a proper handover is done is to have a formal, structured handover process that covers all the sub-systems in the building / complex and relies heavily on formally documented records. 

1.    Identify Sub-systems: As a first step, all major sub-systems should be listed (as for example, above) and assigned to teams of 2 -3 members.  The Managing Committee (MC) can – and should – call for volunteers from the Residents / larger Association body, as it would be quite impossible for the smaller number of people in the MC to do all the handover tasks by themselves.

2.    Identify Components: For each sub-system, all components should be identified and listed.  Keep in mind that each sub-system will have many components, not all of them immediately apparent.  For example, while it’s obvious to most that the Fire and Emergency Management sub-system comprises the smoke detectors and alarm panels, not many know that there is a complex system of pumps and controllers that should also be included here.

3.    Identify Handover Activities: For each component, list all handover activities to be done.  Handover activities would broadly cover the following topics:

  • Obtain Statutory Documentation
  • Obtain User and Technical Documentation
  • Obtain Evidence of checks and tests from Builder
  • Perform own verification

4.    Prepare Handover Checklist: A checklist should be prepared, organised by sub-system and component to clearly document all handover activities and results of the same.  This checklist can then be provided to the builder as a formal record of the handover.  A formal acknowledgment and acceptance of the issues contained within should be then obtained from the Builder which can be used to hold him accountable to fix all defects raised.  This can be done, even if the warranty period is over, provided the acceptance to fix these issues was obtained prior to the end of the warranty period.

Builder RWA Handover Checklist

Comments:

  1. S Srinivasan says:

    Very useful and practical article to be followed by every new association ready for taking over the apt. complex.

  2. Pramod Naik says:

    Excellent. Can Prashant or Citizen Matters produce a DVD of this and offer it on Youtube as a public service?

  3. Ramanathan Chellappan says:

    Prashant –

    We are in the process of getting hand over from the builder soon. Want to understand if we need to hire a vendor to check the fire system? or does Fire NOC suffice that we are in good shape?
    Also we don’t have proper provisioning for RWH . Do we have to get this done from Builder? Will some authorities check at later point of time. Can you please provide more details?

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