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A Facilities Management Agreement sets out how a service provider will handle the day-to-day operations of a building or property. These contracts are common in NZ commercial properties, covering everything from basic maintenance and cleaning to complex systems management and security services.

The agreement spells out key responsibilities, performance standards, and costs while following local health and safety requirements. It protects both parties by clearly defining service levels, reporting procedures, and what happens if things go wrong. Most Kiwi businesses use these agreements to ensure their properties stay well-maintained and compliant with Building Act obligations.

Consider putting a Facilities Management Agreement in place when taking on a significant commercial property or expanding your building portfolio. This becomes especially important when managing multiple service providers or dealing with complex building systems that require specialized maintenance under NZ regulations.

The agreement proves invaluable during property transitions, major renovations, or when scaling up operations. It's particularly vital for buildings with strict compliance requirements, like healthcare facilities or food processing plants. Property owners often implement these agreements when seeking to reduce operational risks, standardize service delivery, or prepare for property certification under the Building Act.

• Single-Service Agreements: Focus on one core service like cleaning or security. These are common for smaller properties or specialized needs.
• Integrated FM Agreements: Cover multiple services under one contract, ideal for large commercial buildings or campus environments.
• Performance-Based Agreements: Link payment to specific KPIs and service levels, popular in corporate offices and retail spaces.
• Building-Specific Agreements: Tailored to unique property requirements, often used for heritage buildings or specialized facilities.
• Bundled Service Agreements: Combine hard services (maintenance, HVAC) with soft services (cleaning, landscaping) under unified management.

• Property Owners: Commercial landlords, government agencies, or corporations who need professional management of their buildings and facilities.
• Facility Management Companies: Professional service providers who deliver maintenance, cleaning, security, and other building services.
• Building Managers: On-site professionals who oversee daily operations and coordinate between owners and service providers.
• Legal Teams: In-house or external lawyers who draft and review agreements to ensure compliance with NZ property laws.
• Compliance Officers: Specialists who monitor service delivery against building codes and health and safety requirements.

• Property Details: Gather full building specifications, systems inventory, and current maintenance records.
• Service Scope: List all required services, performance standards, and specific maintenance schedules.
• Budget Parameters: Document cost allocations, payment terms, and any performance-linked fee structures.
• Compliance Requirements: Check relevant NZ building codes, health and safety regulations, and industry standards.
• Key Contacts: Identify authorized representatives, emergency contacts, and reporting lines.
• Performance Metrics: Define measurable KPIs, reporting requirements, and review processes.

• Parties and Services: Clear identification of all parties and detailed scope of facilities management services.
• Term and Termination: Contract duration, renewal options, and conditions for early termination.
• Performance Standards: Specific service levels, KPIs, and quality benchmarks.
• Payment Terms: Fee structure, payment schedule, and provisions for cost adjustments.
• Health and Safety: Compliance with NZ workplace safety laws and risk management procedures.
• Insurance Requirements: Mandatory coverage types and minimum liability limits.
• Dispute Resolution: Process for handling disagreements under NZ jurisdiction.

A Facilities Management Agreement differs significantly from a Property Management Agreement, though they're often confused. While both deal with property oversight, their scope and focus are quite different.

• Service Scope: Facilities Management focuses on operational maintenance, building systems, and service delivery, while Property Management covers broader aspects like tenant relations, rent collection, and property marketing.
• Technical Focus: FM Agreements emphasize specialized maintenance tasks and building infrastructure, whereas Property Management deals more with administrative and financial aspects.
• Reporting Structure: FM providers typically report to property managers or owners on specific operational metrics, while property managers have broader reporting responsibilities covering entire property performance.
• Risk Allocation: FM Agreements concentrate on operational risks and service delivery standards, while Property Management Agreements address broader property-related risks and tenant relationships.