Flat Management Company

A Flat Management Company is normally incorporated to manage a property or group of properties where there are multiple tenants and is normally used to protect the interests of the leaseholders. The residents themselves usually act as the flat management company directors and shareholders. In large properties, it is not normally necessary for every person to be a director although each will normally hold one share.

The advantage of this structure is that the directors can manage the business of arranging facilities to the common building areas. In the event that one or more residents wishes to sell the property, all that is required is that they transfer their share in the flat management company to the purchasers. A steady increase in the number of flat management companies has been partly due to regulations introduced to allow leaseholders the right to buy and manage the freehold interest in their property. The Commonhold and Leasehold Reform Act 2002 contained several provisions that have been judged to be favourable to leaseholders. The immediate right to extend short leases irrespective of the time of residence has empowered occupiers to eventually consider managing the freehold for their own benefit. By setting up a flat management company, the expenses incurred for the upkeep of the communal areas and the manner in which suppliers and services are bought in would be governed by the residence themselves.

A Flat Management Company has its Memorandum and Articles of Association specially drawn up to allow the company to own, manage and administer a leasehold or freehold property, which is normally divided into several dwelling units or flats, with each leaseholder owning a share in the company. The leaseholder will be obliged to transfer the ownership of the share to the new leaseholder when disposing of the property.

Our comprehensive limited company formation package includes the following:

• Name clearance
• Certificate of Incorporation
• Specialised Objects Clause
• Five bound copies of Memorandum & Articles of Association
• Statutory Registers
• Certificate of Non Trading
• Letter of Surrender of Subscriber Share or Stock Transfer Form or Change of Member Documentation
• First Board Minutes

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