Covid-19 and strata managed properties

Article by Jay Turner of Laguna Pest Control – Thanks again Jay.


We are entering scary and uncertain times with the advent of Covid-19 and there is no doubt we are all going to feel the financial impact from this. One thing I have been trying to do is pre-empt how and which areas of my business this financial downturn is going to affect. To do so I have been looking at each of the different categories of work we do. The most obvious one was food production premises such as restaurants and cafes which I discussed in a previous article. This article now discusses strata managed properties.

Strata managed properties, commonly called Body Corporate managed, are properties that are jointly owned and comprises multiple units, common areas and common facilities. This may include holiday let accommodation such as resorts, or permanently occupied residences and businesses. My first thoughts were that pest control would be one of the first expenses that these establishments would drop in order to cut costs over the coming months. However, after spending the day speaking to several of our resort managers and body corporate managers to get a feel for what will happen, this doesn’t seem to be the case. The main reason being is body corporate expenses are typically forecasted and budgeted for in advance. Therefore, the funds for pest control have typically already been put aside. The other reason being is that the body corporate fees which each individual owner has to pay is divided up into an administrative fund and a sinking fund. The administrative fund is used for those everyday anticipated expenses such as maintenance, gardening, pool servicing, cleaning, electricity and water for common areas and of course pest control. Whereas the sinking fund is used for capital expenses for the building such as painting, major repairs, replacement costs and any other infrequent expenditure. So, the sinking fund is often used for those unexpected costs possibly even shortfalls from owners not paying their body corporate fees possibly during an economic downturn.

There is no doubt that there will be some smaller body corporate managed properties that will feel the pinch from this economic downturn due to poor financial planning and not having any reserves in their sinking fund. But the common consensus was that pest control was an essential service and one that should not be impacted by the predicted covid-19 financial crisis. I was even advised by a body corporate manager not to discount our services during this period as it will only cause issues with financial predictions for the following year.

And to end on a further positive note, holiday let premises are at their all-time lowest occupancy rate. Meaning access into most units is going to be a lot easier and a lot less required visits. And then add that there will be a lot less mopping between guests meaning our products should last significantly longer. And hence less chance of service calls!

Brad