To solve the problems caused by disposition of leases in interdependent units such as flats, office blocks, shopping centres etc. the government introduced the ‘commonhold’ type of ownership.
Under this type of ownership, individual units are held as freehold, but the common parts such as entrance, corridor are held in common under a commonhold association that shall be liable for all repairs, etc. to these common parts. The commonhold association is held as a private limited company and owners of all individual units shall be its members. A community statement that states the obligations of every individual unit owner is formed. This obligation shall be binding on all of them, including the obligation to pay service charges. This responsibility ensured by the statement whether positive or negative shall be binding on successors to the title, as well.
When every single unit is held as a freehold, the problem of wasting asset can be tackled and when the common parts are held under the commonhold association, the problem of landlords charging demanding inflated service charges is solved as well. This type of ownership is available for new and existing developments, but to convert existing blocks, express permission from the landlord as well as the tenants is required.
Photo courtesy: Eamon Curry
