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GJA Law – Sydney’s Trusted Building Management Statement Lawyers

Building Management Statements in Sydney

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Building Management Statements is a significant legal matter that affects many individuals and families in Sydney. At GJA Law, we provide clear, practical advice and tailored services designed to protect your interests. Our approach combines local expertise, transparency in fees, and a commitment to simplifying complex legal processes.

What Is Building Management Statements?

A Building Management Statement (BMS) is a legally binding agreement registered on the title of two or more lots that outlines how shared areas, services, and responsibilities are managed between different owners or occupiers. Unlike strata by-laws—which apply within a single strata scheme—a BMS can govern relationships between separate titles, including:

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    • Residential and commercial lots in a mixed-use building.
    • Adjoining buildings sharing a common driveway, lift core, or façade.
    • Freehold lots with integrated infrastructure (e.g., shared basement car parking across separate buildings).

    The BMS defines who pays for what, who maintains which elements, and how decisions are made—creating a private governance framework where standard property law falls short.

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    When Is a Building Management Statement Required?

    A BMS is typically required in Sydney when:

    • A development includes multiple lots under separate ownership that share essential infrastructure (e.g., fire systems, HVAC, lobbies, or egress paths).
    • A mixed-use development combines retail, office, and residential uses across different titles with interdependent services.
    • No strata scheme exists (or only partial strata applies), yet ongoing cooperation is needed for building functionality.
    • Council or a financier mandates a BMS as a condition of development approval or funding.

    Common examples include:

    • A ground-floor retail lot and upper-level residential lots owned by different parties.
    • Two adjacent townhouse blocks sharing a common basement.
    • A commercial tower and a residential tower built on separate titles but connected by a shared podium.

    Without a BMS, disputes over maintenance, access, or cost allocation can quickly escalate—potentially paralysing building operations.

    Legal Framework Governing Building Management Statements

    In New South Wales, Building Management Statements are governed primarily by the Real Property Act 1900 (NSW) and supported by the Conveyancing Act 1919 (NSW). Key legal principles include:

    • A BMS must be in writing, signed by all affected lot owners, and registered on the title of each relevant lot via NSW Land Registry Services (NSW LRS).
    • Once registered, it binds future owners—not just the original signatories.
    • The BMS operates as an equitable covenant and can be enforced through the Supreme Court or NCAT.
    • It must not conflict with existing easements, covenants, or strata by-laws.

    Importantly, the BMS exists outside the strata framework, making it essential for developments that fall into the “governance gap” between traditional freehold and strata ownership.

    Key Components of a Building Management Statement

    A comprehensive BMS typically includes the following elements:

    1. Recitals and Definitions: Clarifies the parties, lots involved, and shared infrastructure.
    2. Management Committee: Establishes a committee (often with weighted voting) to oversee operations.
    3. Cost Allocation: Specifies how expenses (utilities, cleaning, security, insurance, repairs) are shared—usually by lot size, usage, or agreed percentage.
    4. Maintenance Obligations: Identifies which party is responsible for maintaining specific building elements (e.g., façade, fire stair, rooftop plant).
    5. Access Rights: Grants necessary rights of entry for inspection, repair, or service of shared systems.
    6. Insurance Requirements: Mandates joint building insurance and outlines claims procedures.
    7. Dispute Resolution: Sets out steps for mediation or expert determination before litigation.
    8. Amendment Process: Defines how the BMS can be varied in the future (usually requiring unanimous or majority consent).
    9. Termination Clauses: Rare, but may include triggers such as amalgamation of titles or mutual agreement.

    At GJA Law, we tailor each BMS to the physical layout, usage patterns, and commercial interests of the specific development.

    Drafting and Negotiating a Building Management Statement

    Drafting a BMS is not a one-size-fits-all exercise—it requires careful negotiation among stakeholders with potentially competing interests. Retail owners may resist subsidising residential concierge services; residential buyers may object to commercial operating hours affecting noise or access.

    Our approach includes:

    • Early engagement: Drafting the BMS during the design or pre-sale phase to avoid last-minute conflicts.
    • Balanced cost-sharing: Ensuring contributions reflect actual usage and benefit, not just square metreage.
    • Future-proofing: Anticipating changes in tenancy, technology, or building use over time.
    • Clear language: Avoiding technical jargon so owners and managers can understand their obligations.
    • Coordination with other documents: Aligning the BMS with leases, development agreements, and strata by-laws where applicable.

    We also assist with registration logistics, ensuring the BMS is properly lodged with NSW LRS alongside any related easements or covenants.

    Because a BMS binds future owners, courts interpret its terms strictly—making precision in drafting essential. A vague clause on “shared utilities” could lead to years of disputes over electricity submetering or water rates.

    Our Services

    GJA Law assists Sydney clients with a wide range of building management statements matters, including:

    • Reviewing and drafting contracts or agreements
    • Advising on legal rights and obligations
    • Negotiating terms or resolving disputes
    • Working with agents, financial advisors, or other professionals where necessary
    • Managing the process through to completion with accuracy and efficiency

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    Why Choose GJA Law?

    GJA Law brings deep expertise in Sydney’s complex property landscape. Our team has advised on BMS arrangements for developments across the Lower North Shore, CBD, Eastern Suburbs, and growth corridors like Parramatta and Liverpool. We offer:

    • Clear, commercially focused drafting that reflects your project’s realities.
    • Fixed-fee options for standard BMS frameworks.
    • Rapid turnaround to meet settlement or registration deadlines.
    • Integrated advice across property, planning, and commercial law.

    A well-crafted Building Management Statement doesn’t just prevent conflict—it enables seamless, efficient building operations for decades to come.

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    Contact Us

    If you are dealing with building management statements in Sydney, contact GJA Law today. Our experienced lawyers will guide you through the process with confidence and provide the support you need.

    Common Building Management Statements FAQs

    What is the purpose of a Building Management Statement (BMS)?

    A Building Management Statement is designed to provide certainty and structure where multiple owners rely on shared building elements or services. It clearly defines rights, obligations, and cost-sharing arrangements for infrastructure such as lifts, basements, fire systems, utilities, and accessways. By setting out these arrangements upfront and registering them on title, a BMS reduces the risk of disputes and ensures the building can operate efficiently over the long term.

    How is a Building Management Statement different from strata by-laws?

    Strata by-laws apply within a single strata scheme and regulate relationships between lot owners and the owners corporation. A Building Management Statement, by contrast, governs relationships between separately owned lots or schemes, often where no overarching strata structure exists. In mixed-use developments, a BMS commonly operates alongside strata by-laws to manage shared infrastructure that services multiple titles or schemes.

    When is a Building Management Statement required or recommended?

    A BMS is typically required where multiple lots under separate ownership share critical infrastructure or access arrangements. This commonly arises in mixed-use developments, developments with shared basements, or projects built across multiple titles. Councils, lenders, or purchasers may also require a BMS as a condition of approval, funding, or settlement. Even where not strictly required, a BMS is strongly recommended to avoid governance gaps.

    Who is legally bound by a Building Management Statement?

    Once registered with NSW Land Registry Services, a Building Management Statement binds all current and future owners of the affected lots. This means purchasers step into the obligations and benefits created by the BMS, regardless of whether they were involved in negotiating it. Because the document has long-term consequences, it must be drafted clearly, fairly, and with future ownership changes in mind.

    What risks arise if no Building Management Statement is in place?

    Without a BMS, disputes can arise over who is responsible for maintenance, insurance, access, or payment of shared costs. These disputes can delay repairs, compromise building safety, and reduce property value. In some cases, the absence of a BMS can prevent development approval, delay settlements, or cause financiers to withhold funding due to uncertainty around ongoing management arrangements.

    Can a Building Management Statement be amended after registration?

    Yes, but amendments are often complex and tightly controlled. Most Building Management Statements require unanimous or near-unanimous consent from affected owners, making changes difficult once lots are sold. Courts interpret BMS provisions strictly, so poorly drafted or vague clauses can be hard to fix later. This makes careful drafting and future-proofing essential from the outset.

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