How to Change Strata Managers Without Wrecking Your Building

How to Change Strata Managers Without Wrecking Your Building

Changing your strata manager is one of the most consequential governance decisions an owners corporation will make. Done well, it produces immediate improvement in the quality of management, the responsiveness of communication, and the financial transparency of the building. Done badly, it produces months of disruption — missing records, contested invoices, undelivered AGM notices, contractors with no clear point of contact, and a committee that splits over who was right.

The October 2025 reforms to the NSW Strata Schemes Management Act 2015 gave NCAT new power to vary or end management agreements where the manager is operating in conflict with the OC's interests. The threshold for change has therefore lowered, and more buildings will go through this transition in 2026 than at any time in the recent past. This article walks through the legal framework, the practical steps, the common pitfalls, and what to do when the outgoing manager makes the transition difficult.

When Should a Building Change Managers?

The decision to change managers should be made for specific, documented reasons — not for general dissatisfaction or because a single committee member has a preferred alternative.

The reasons that justify change fall into four categories.

Service quality. Persistent failure to respond to communications, errors in financial statements, missed AGM notices, failure to enforce by-laws, or general administrative incompetence. The pattern, rather than any single incident, is what justifies change.

Cost. A management fee that is materially above market for buildings of comparable size and complexity. Most management contracts can be benchmarked against published fee schedules from competitors and from industry surveys, and a fee that is 30-50% above market is meaningful.

Conflict of interest. Disclosed or undisclosed commissions, related-party transactions, contractor referrals that do not appear to be at arm's length, or any of the patterns of conduct identified by the 2024 ABC Four Corners investigation and the subsequent reforms. The October 2025 reforms made this category of reason significantly more legally consequential.

Strategic fit. A manager whose business model is no longer aligned with the building's needs — typically a small specialist manager whose building has grown into a complexity beyond their capacity, or a large firm whose service has become standardised in a way that does not suit a building with specific needs.

A change driven by any of these reasons, supported by documented evidence, is significantly more likely to produce a successful transition than a change driven by personality conflict between the manager and a particular committee member.

The Legal Framework: Ending the Existing Agreement

The legal pathway for ending the existing management agreement depends on the contract terms and the state framework.

Expiry. Most management agreements run for an initial term of 12-36 months and continue on an annual basis after the initial term expires. The simplest pathway for change is to give notice not to renew the agreement at the next renewal point. Notice periods vary but are typically three to six months before the renewal date.

Termination for cause. Where the manager has materially breached the contract — failed to perform required services, breached confidentiality, breached fiduciary duties — the contract typically allows the OC to terminate with notice. This requires documented evidence of the breach and is most commonly used where the manager has acted in clear conflict with the OC's interests.

Termination by special resolution. Many management agreements contain provisions allowing the OC to terminate by special resolution at a general meeting, often with a notice period of 30-90 days. This is the standard pathway for changes driven by general dissatisfaction or strategic fit.

NCAT order (NSW). The October 2025 reforms gave NCAT power to vary or end a management agreement where the manager is found to be operating in conflict with the OC's interests, has breached fiduciary duties, or has otherwise conducted themselves in a manner that warrants termination. This is the appropriate pathway where the manager is resisting change, where there is documented misconduct, or where the OC's standard contractual options are inadequate.

Mutual termination. Where both parties agree, the agreement can be terminated by mutual consent. This is more common than is sometimes recognised — managers facing a likely loss of the agreement at the next renewal sometimes prefer to negotiate an amicable departure than to fight a contested termination.

The right pathway depends on the circumstances. For most changes, the expiry-or-special-resolution route is sufficient. For changes involving misconduct, the NCAT route may be appropriate.

The Process: Step by Step

The process for changing managers, in roughly the order it should be followed, is as follows.

Step one: build the case. Document the reasons for change. Collect the evidence — service failure logs, fee benchmarking, conflict of interest evidence, missed deadlines. Present the case to the committee in writing. The committee's decision to recommend change to the OC must be based on substantive grounds.

Step two: review the existing contract. Identify the term, the renewal date, the notice requirement, the termination provisions, and any handover obligations. Understand exactly what the OC can and cannot do under the contract.

Step three: source replacement candidates. Issue a tender or expression-of-interest process to several qualified strata management firms. Provide each candidate with the same information about the building — number of lots, age, type, current fee, services required, particular issues. Request a written proposal addressing services, fee, transition plan, and approach to common building issues.

Step four: evaluate proposals. Review each proposal against a clear set of criteria — service quality, fee, transition capability, references from comparable buildings. Visit the candidate firms' offices where possible. Speak to references at buildings the candidate manages. Take the time to evaluate properly.

Step five: convene the general meeting. A change of strata manager requires either a special resolution at a general meeting, or (for less significant changes) a committee resolution if the contract permits. Issue the meeting notice with the required period (typically 14-21 days), include the proposed motion clearly, and ensure the agenda and supporting papers are available.

Step six: conduct the meeting. Present the case for change. Allow questions. Hold the vote. If the resolution passes, formally notify the existing manager.

Step seven: handover. This is the step that most damages buildings. The handover from outgoing to incoming manager involves the transfer of records (financial, by-law, correspondence, contracts, building plans), funds (administrative and capital works fund balances), keys and access devices, contractor relationships, and ongoing matters (active complaints, repairs in progress, owner inquiries). The handover protocol should be documented, scheduled, and supervised by the committee.

Step eight: post-transition review. Three months after the new manager takes over, review the transition. Were all records transferred? Were any matters lost or delayed? Is the new manager performing as proposed? The review allows the committee to identify and address any remaining transition issues before they compound.

The Common Pitfalls

Several recurring problems disrupt manager transitions.

Lost records. The outgoing manager is sometimes uncooperative about transferring records, particularly historical records that the incoming manager will need to manage long-running matters. The contract usually requires a complete handover, and the OC's interest is in obtaining everything before the existing relationship ends. Insisting on a complete records list at the point of termination, rather than after, is significantly more effective.

Contested invoices. The outgoing manager often presents final invoices for fees, expenses, or services performed in the final months. Some of these invoices are legitimate; some are inflated or duplicate charges already paid. The committee should review final invoices carefully against the contract and the records.

Contractor confusion. The building's contractors — plumbers, electricians, fire safety consultants, gardeners, cleaners — have relationships with the outgoing manager. The transition typically involves either continuing those relationships or replacing them with the incoming manager's preferred contractors. Either path is fine; the failure mode is leaving the contractors uncertain about who they should be invoicing and reporting to.

Owner communication. The transition is significant for owners and should be communicated proactively. A letter from the committee explaining the change, the rationale, the timing, the new contact details, and the practical impact on owners (levies, insurance, by-laws) prevents most owner complaints.

Insurance and statutory obligations. Strata insurance, building insurance, work health and safety obligations, fire safety statements — all of these have continuing obligations that must be transferred clearly. The committee should confirm with the new manager that each obligation is being managed.

Committee splits. Manager changes are sometimes contested within the committee, with one or two members supporting the existing manager and the majority supporting change. This is uncomfortable but manageable. The OC's resolution at a general meeting is the legitimate authority. Committee members should respect the outcome regardless of their personal preference.

When the Outgoing Manager Makes It Difficult

Most managers manage transitions professionally. Some do not.

The patterns of difficulty include refusing to provide records on request, claiming additional fees for handover work, retaining funds in trust accounts without a clear basis, communicating directly with owners to undermine the change, and (in extreme cases) using their access to building systems to make the transition harder.

The legal options available to the OC depend on the conduct.

For records refusal, the contract almost certainly requires handover of all records relating to the building. A formal demand, escalated to legal correspondence if necessary, generally produces compliance. NSW Fair Trading's October 2025 enforcement powers extend to records-related matters.

For contested final invoices, the OC's position is to pay only what is documented and contractually owed. Disputed amounts can be escalated to mediation or, if necessary, the Tribunal.

For trust account issues, every state's regulator (Fair Trading in NSW, Consumer Affairs in Victoria, the Office of Fair Trading in Queensland) has jurisdiction over strata manager trust accounts and can investigate where funds are not being remitted to the new manager appropriately.

For communications with owners that undermine the change, the OC's position is to communicate the legitimate decision to owners and to address the substance of any concerns raised. Most owners ultimately respect the OC's resolution.

For extreme cases — abusive conduct, theft, sabotage — the OC's options extend to police complaints, professional misconduct complaints to the relevant industry body (SCA NSW or equivalent), and civil proceedings.

The State-by-State Picture

How UnitBuddy Helps

UnitBuddy's manager transition module captures the records, contracts, contractor relationships, and ongoing matters that need to transfer at handover, and provides a structured handover protocol that both outgoing and incoming managers can work through. The system maintains a complete, time-stamped record of the building's affairs that survives the transition, ensuring that historical context, decisions, complaints, and repairs are not lost.

For committees considering a change, the platform's audit and benchmarking features provide the data foundation for the case — fee comparison, service responsiveness metrics, complaint patterns — that justifies the decision to the OC.

Changing strata managers is rarely a casual decision and should not be made for casual reasons. Done with documented evidence, a structured process, and a clear handover protocol, it is one of the most powerful tools an owners corporation has to improve the way its building is run. Done casually, it is one of the easiest ways to damage years of operational continuity in a single quarter.