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French Property Insider

Volume VIII, Issue 18
May 6, 2010
Paris, France
http://adrianleeds.com/frenchproperty/insider

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Special Note to New Subscribers:

We have been publishing this "e-zine" since 2002 for paid subscribers, and now, since April 29, 2010, FPI is free to all who wish to stay informed of what's new on the French property market...for investment or pleasure.

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A bientôt,

Adrian Leeds
Editor, French Property Insider

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Bonjour French Property Insider Subscriber,

Almost every residential building in Paris has a "copropriété" (home owners association) and therefore a "Syndic" (manager) that effectively (or often ineffectively!) manage the property.

The copropriété is made up of the owners of the individual apartments or offices. The Syndic is normally a management company with a "Carte Professionelle Gestion Iimmobilière" (a management license), but can also be a volunteer -- someone who generously gives of his/her time to manage the property on behalf of all of its residents.

Naturally, it is a savings if the association doesn't have to pay a management company -- annually about 2€ per square meter of space, or 130€ per apartment of an average size (65 square meters). In total, the owners pay on the average a little more than 22€ per square meter per year to the copropriété, with heating one of the principal costs of about 20%, followed by personnel expenses (guardian, maintenance manager, etc.) which represents about 15% of their annual budgets. Increases in expenses in the past few years can be attributed to new regulations enforced by the government in concern of environmental issues (asbestos and lead contamination) and new security measures (digicodes, interphones, etc.)

Annually, the two entities meet to discuss the past and coming year's business at hand. During that one session, much must be decided, although smaller committees meet during the year to deal with more precise issues. Owners who cannot attend, can give their power of attorney to another owner or other party, who then can vote on his behalf. (We often provide this service for absentee owners.)

Attending one of these meetings, known as the "Assemblée Générale," is a mixture of both pain and pleasure. This past March, I reported on the meeting from my own building in the Parler Paris Nouvellettre® , proclaiming that in 10 years of ownership, only one had been missed...not a bad record.

Tuesday afternoon, in the conference room of the Académie d'Architecture at 9 Place des Vosges, the owners gathered for their annual meeting. One of the owners of Le Palace des Vosges, the fractional ownership apartment at that address, attended with me. She spoke little French and therefore spent more time observing, while I was listening intently. She eyed the cast of characters with interest.

The usual suspects were there -- a mixture of people who had been a part of the illustrious dwelling for many years: the Michelin three-start restaurant, L'Ambroisie, the president of the Académie d'Architure, American art dealer, Nikki Diana Marquardt and a host of individual home owners.

With the magnificent 16th-century brick structure on view from the massively high windows adorned by freshly burgeoning linden trees, we endured almost four hours of chaotic posturing by the owners, the sounds of their voices bouncing off the hard walls, making it almost impossible to hear anything distinctly. There were 27 "resolutions" to be addressed and each one required conversation and decision-making.

The renewal of the Syndic's contract must be voted upon every year and every year that I've observed, this Syndic manages to snake past the vote in spite of the fact that almost every owner is unhappy with their performance. It becomes a "Catch 22," whereas they can't really replace one until another one is ready to take over, so in effect, a smaller committee must interview other companies in advance and make a recommendation that would then come before the owners at the annual meeting. No one has attempted this, and therefore the ineffective Syndic is renewed each year with disgust.

The owners' biggest complaint is their lack of responsiveness and their poor management skills are evidenced by their inability to control the annual meeting. Usually, at least one or more of the owners has to take over to prevent the meeting from getting completely out of hand while the manager, a young woman, sat there in bewilderment not knowing how to handle these aggressive owners.

There was one resolution (#24) that concerned our apartment, designed to question the rights we had to change the facades to the apartment and the garages, as well as the rights we had to plant shrubbery and install patio furnishings outside in the courtyard. In response, our Notaire prepared a letter explaining that not only did we have the permission from the Architects des Bâtiments de France and the Mairie de Paris, but from the last copropriété meeting whereas they themselves voted to grant us permission to make the changes, all very well documented! Meanwhile, a deceased owner's car has been sitting in the courtyard for five years with no one paying much attention to the eyesore it creates. So, why were we being questioned?

Luckily, now that I'm a seasoned attendee of these meetings, I've learned not to take their posturing too terribly seriously, or at least to see the reality over and above the legal aspects. We had jumped all the proverbial hoops and couldn't ascertain why the improvements we had made to the property were being criticized...until we learned the truth: a small group of owners noticed that we had spent a lot of money to change old metal shutter-style garage doors into beautiful cathedral glass and metal atelier-style doors, triggering their suspicion that we were going to make apartments out of the garages, changing the classification of the property!!

We both got a big laugh out of that one! And proclaimed that NO, they were both "remises" -- one for storage and one for a car or bikes. YES, we just wanted them to be beautiful and improve the appearance of the courtyard! YES, it cost dearly to do so. And so now it was our turn to ask, "Would you like us to replace them with what was there previously!? And what do you intend to do about the car that no one (alive) owns?"

There was no clear answer to either question, and on the issue of our planter boxes and lawn furniture: that is clearly "interdit" (forbidden). One cannot do anything in the common areas without permission of the copropriété. But did they object to their beauty? NO! So, when I asked "Does that mean we must remove our 'jolies plantes?'" They didn't actually say "yes" or "no," but reiterated that we simply didn't have "le droit" to place them there.

Will we really remove them? Probably not...at least not until they issue some sort of official legal restraint, as I have a feeling no one really objects to their presence, and in fact appreciate their enhancement of the property, but object only to the individual freedom they represent. (Oh, those unruly Americans!)

The point of all this is that as a property owner in Paris, you can expect to have to get along with your neighbors, as you/we all live under the same roof, like it or not. They have and make their rules, and we must find our path to live harmoniously within them.

A bientôt,

Adrian Leeds
Editor, French Property Insider
Email: fpi@adrianleeds.com

P.S. The Chambre de Notaires de Paris reports for February 2010 that sales in Paris are up over last year by 38%, the average price per square meter is 6,390€ and have increased on the last quarter (November 2009 - February 2010) by 1%.

P.P.S. Plan on spending Tuesday afternoon, May 11th from 3 to 5 p.m. at Parler Paris Après Midi, when we all gather for a drink and a lot of laughs. Visit http://www.adrianleeds.com/parlerparis/apresmidi.html or more information.

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