Right to manage (RTM)

The right to manage was created by the Commonhold and Leasehold Reform Act 2002. Leaseholders who qualify set up an RTM companyRTM companyA private company limited by guarantee, set up by leaseholders, whose object is to acquire and exercise the right to manage their building., invite the other leaseholders to join, and serve a claim noticeClaim noticeThe prescribed notice in which an RTM company tells the landlord (and anyone else with management duties under the leases) that it claims the right to manage, and names the date it intends to take over. on the landlord. If the claim succeeds, the company takes over the landlord's management functions on the acquisition dateAcquisition dateThe date on which an RTM company takes over the management of the building from the landlord..

What changes, and what doesn't

• The RTM company takes over services, repairs, maintenance, improvements, insurance and management under the leases (s.96).
• The landlord keeps the freehold, the ground rent, and the right to forfeit a lease (s.96(6)(b)).
• Leaseholders keep their leases, with exactly the same terms.

Good to know

• No compensation is paid to the landlord.
• Since 3 March 2025, the RTM company is generally not liable for the landlord's costs of the claim. A tribunal can only order costs if the claim ends and the company acted unreasonably (ss.87A–87B, added by the Leasehold and Freehold Reform Act 2024).
• Buildings may now have up to 50% non-residential floor space, up from 25% before March 2025.

See our guide What is the right to manage?.