Builder gone bust

C-J

Hi all, i am renting a new apartment in mayo built by Kamer construction (my landlord is the builder). I just got a call from a Dublin management company saying that they will be taking over as my landlord as of next month, we are having a residents meeting tomorrow to switch standing orders etc. I am prob being unnecessarily careful here but does this mean that the builder has gone bust, is my initial contract wit my landlord null and void (years lease due for renewal in july) or does this management company take over? Mods please feel free to move, not my area of expertise so i'm confused!

muffler

This will probably be more at home in the Accommodation & Property forum.

Moved from Construction & Planning

athtrasna

You should be able to find this out at the meeting, your lease has not been terminated as such...it's an interesting situation.

A very important thing to clarify is that status of your deposit, as this would have been paid to your landlord. You may need legal advice on this but it depends on what you are told at the meeting.

C-J

Thanks for reply, i'm going to write a list of questions for tomorrow. My deposit and months rent was paid to local estate agent as they were my first point of contact, I might call into them to see what they say. Surely I should have gotten a letter etc off the landlord rather than a random phone call to say there'll be a meeting tomorrow! The rest of the renting neighbours and I are a bit confused it all happened so quickly. My sister works in property she basically said to read everything carefully before i sign and that the terms of the contract should be the same

Victor

http://www.insolvencyjournal.ie/notices/11-11-04/Appointment_of_Receiver_Kamer_Construction_Limited.aspx

odds_on

If you have a fixed term lease no one can terminate this prior to the expiry date, even if there is a change of ownership of the property. The new owner has bought the property with tenants in situ.

However, I am somewhat dubious about the term "Management Company" as taking over the ownership. Normally, a management company is comprised all the owners of a property within a block or a house on a secure estate. Thus I am a bit confused here. Just because a "Managing" Company (different to a Management Co.) who would be similar to a managing agent, is taking over the running of some apartments does not mean that the builder has gone bust. It is just taking some of the work load off the builder. The same as a Management Company appointing a managing agent who does what the managing company says - basically looking after the property and in some cases looking after the rent payments and management fees.

If the builder has gone bust, I would be more worried about who is going to remedy any faults in the properties, rather than to whom I am having to pay the rent to.

jmayo

odds_on wrote: »

However, I am somewhat dubious about the term "Management Company" as taking over the ownership. Normally, a management company is comprised all the owners of a property within a block or a house on a secure estate. Thus I am a bit confused here. Just because a "Managing" Company (different to a Management Co.) who would be similar to a managing agent, is taking over the running of some apartments does not mean that the builder has gone bust. It is just taking some of the work load off the builder. The same as a Management Company appointing a managing agent who does what the managing company says - basically looking after the property and in some cases looking after the rent payments and management fees.
...

My reading of it is that the builder has gone bust and thus a receiver may have been appointed by the creditors (usually banks) and they have appointed a management company (such as Colliers, Knigh Frank, or RFPM for instance) to manage the property portfolio of the builder.
Of course I could be wrong on this.

I have heard of instance where management company are working for NAMA managing properties that have affectively been removed from developers/investors because they are not repaying loans and also can't be trusted to not pocket some rents.
Thus the rents are paid to management company and onto NAMA.

EDIT check out Victor's link and it shows

Declan McDonald of PricewaterhouseCoopers was appointed Receiver by Ulster Bank Ireland Limited on 4th November 2011
Solicitor for Ulster Bank Ireland Limited: Mason Hayes & Curran
Registered address: Unit 1 Oldenway Commercial Estate, Ballybrit, Co Galway
Last accounts filed: 31/12/2009
CRO number: 179287

odds_on

Actually, I'm "house hunting" myself and having googled the builder, I see that he constructed 4 blocks and has 9 apartments left to sell (June 2011). The development is classed as an "unfinished development" by a government department (but Class 1 which is nearly completed). So looks like he has gone bust.

I have a note that I liked the apartments (1 and 2 beds overlooking the river).

It'd be nice to know the outcome of the meeting.

C-J

Met with the lady, basically had to transfer standing orders etc. She told us its all a big mess at the moment and that dealing with the tenants is the easy part, its the unfinished houses that are difficult to deal with. Didn't have to sign new lease or anything, but when I asked about the status of my months rent and deposit (over 1200) I was told that the estate agent would have paid this to the builder so that they will see nearer the time what will happen. Surely they will have to pay this to tenants who want to leave once the lease is up? There are 22 lease holders in my estate alone, and there are many many more built by this builder. I knew that there was something up because the estate is unfinished, 6 months ago there used to be workmen everywhere in company van finishing homes and it stopped overnight.

Marcusm

Ulster Bank is not in NAMA and did a lot of developer financing. As a result, they have taken over a lot of rented apartments (including 200 in the gasometer at the Gasworks in Dublin). The we management agent should write to you confirming the terms of your lease and accepting that the deposit will be made good. Decent receivers know that there's little point in defaulting on or not confirming the deposit liability as all it would lead to is an increase in damage, a reduction in rents (as people fail to pay last months etc) and an increase in voids. It's 2 years since the change in status at the Gasworks and I have yet to hear of anyone who lost a deposit.

C-J

Thanks thats good to hear. The thoughts of losing a deposit and a months rent would disgust me, its a lot of money at the moment to anybody!!

Victor

Personally, I would be more comfortable if there was something in writing from the receiver.

wyndham

Use the deposit as last months rent when the time comes.

the_syco

C-J wrote: »

Thanks thats good to hear. The thoughts of losing a deposit and a months rent would disgust me, its a lot of money at the moment to anybody!!

Ask if you can have a few free months of rent if they can't refund you the deposit and the months rent?

On a side note, you gave the rent and deposit to the EA, so the EA "should" give it back, but I'd say they'll just say that they gave it to the landlord. Has anyone sued the EA for not giving back the deposit, I wonder?

shangri la

the_syco wrote: »

Ask if you can have a few free months of rent if they can't refund you the deposit and the months rent?

On a side note, you gave the rent and deposit to the EA, so the EA "should" give it back, but I'd say they'll just say that they gave it to the landlord. Has anyone sued the EA for not giving back the deposit, I wonder?

no chance.

odds_on

the_syco wrote: »

Ask if you can have a few free months of rent if they can't refund you the deposit and the months rent?

On a side note, you gave the rent and deposit to the EA, so the EA "should" give it back, but I'd say they'll just say that they gave it to the landlord. Has anyone sued the EA for not giving back the deposit, I wonder?

The agent is only acting on behalf of the landlord - it is the landlord's obligation to return the deposit not the agent's. Your agreement is with the landlord and not with the agent.

The landlord might change agents during the term of the lease. However, the return of the deposit might be through the agent but it is not the agent's responsibility to return it.