Developers Creating Communities

Developers Creating Communities

Developers may use community title for traditional subdivisions, where previously standard titling arrangements were used in order to create communities. The use of community title allows a developer of a significantly sized flat land subdivisions to put together a package of urban lifestyle attributes for residents in a suburban environment. This is a marketing advantage for these projects.

Community title offers a flexible form of community governance, which is essential for truly creating a community. There are financial costs associated with the community governance. In return the governance offers lifestyle advantages and other financial savings with the community management model offering the developer an exit strategy from the project.

What is Community Title for Flat Land?

Community title is a method of providing governance for specific areas of land. It is “soft infrastructure” that complements the physical infrastructure built by developers. The governance runs with the land (as opposed to just attaching to the owner at that particular time).

The governance does more than traditional covenants. Covenants burden the land, restricting the behavior of the occupants of the land. Community title governance provides flexible management structures for people to come together to make decisions about issues that impact upon their land, and it also provides the administrative systems that allow the members of the community to implement their decisions.

What makes a Community Title?

Universally, the components of community title are –

  • Freehold land. The owners of this land become the members of the body corporate;
  • Common property, which is land held in the name of the body corporate on behalf of all of the members of the body corporate; and
  • A body corporate, which is the legal entity that comes into existence for the purpose of managing the common property on behalf of the owners of the freehold land.

    What is the Management System?

    Community title is suitable for flat land subdivision because it provides a management system specific parcel of land. These management systems are becoming increasingly necessary for developers to deliver on their vision for their projects. This management system can deal with issues that are particular to the freehold land that makes up the parcel. The issues that the body corporate may decide to manage include:

  • Regulating the built form of housing on each lot within the community;
  • Managing the open space within the community. This open space may be public open space (owned by the local authority, which the body corporate can administer through agreement with the local authority), private public open space (owned by the body corporate) or private open space (owned by individual residents);
  • Services received by the occupants and owners of the freehold; and
  • Managing and maintaining infrastructure that is particular to the parcel of land. Infrastructure of this kind is becoming increasingly more common, especially as developers introduce environmentally sustainable initiatives.Through the appropriate management system, the freehold land owners can receive real benefits in the form of services and greater amenity from the residential environment.

    Is There a Compelling Case for Community Title to be Used Today?

    If one accepts that creation of a successful flat land subdivision requires more than building physical infrastructure (such as a lake, a golf course or a community center), then the case for community title is established. While the physical infrastructure is essential, it is not the entire solution.

    What are the Marketing Advantages? 

  • Purchasers of land in a community title scheme will benefit from advantages being in a community titles scheme such as:
  • Facilities, like a community center or a walking track or a playground, designed for the community to allow residents to enjoy the amenity of the area in which they live;
  • Security through the provision of a community security service and also through the sense of community and safety enjoyed by all the residents;
  • Convenience through the provision of community specific services to the lot owners;
  • Presentation of the public areas and of the homes in the development through programmed maintenance and building covenants; and

Sense of community through the interaction of the residents.

What are the Developer’s Advantages?

Community title is a system for delivering on the vision of the development through the establishment and management of the covenants relating to the land through a Covenants Management System. Previously these covenants existed because of contractual arrangements between the developer and the first purchaser of the land with only the developer being able to enforce the covenants. The Covenant Management System was a consumer of resources and a source of angst for the development team. Community title allows for the body corporate to become the keeper of the standards for the community, and enforce the covenants as and when required.

Community title provides the developer an exit strategy from the development as it allows the developer to hand over all functions involved in running the community to the owners. The developers need not supply all the staff and funding for fulfilling community functions, such as maintenance duties. The developer’s marketing team can also pass over to the body corporate community social initiatives, like a newsletter, to ensure there is clear communication and an open forum with all residents

To talk to one of our knowledgeable strata development consultants, click here.