What should I look for in a management company?
As a member of the board of directors for your condominium community or homeowner association, you and your fellow board members are charged with a plethora of specific – and very important – duties, all outlined in the association’s bylaws. It truly takes a village to run a condo: you make all of the major decisions and establish policy for the association. It’s a big task and chances are you are all busy with your jobs and families. Further, in many cases, you may lack knowledge or expertise about residential building management. Thank goodness for the professionals at the property management company whose responsibility it is to handle the daily tasks of managing the community – from fee collections and bookkeeping, to overseeing building capital improvement projects and handling maintenance emergencies. The best full-service property management companies add value to a property in a number of ways:
- Handles all aspects pertaining to the day-to-day operations of the property
- Performs regular routine and preventive maintenance checks. Works to identify any maintenance issues early on and provides a detailed report and remediation plan
- Hires and manages qualified vendors from an established network to provide needed services, i.e. grounds maintenance, janitorial, etc.
- Attends monthly and annual board meetings and facilitates effective governance by providing expertise and support; maintains an open line of communication with the board, and keeps residents well-informed of any building and community-related issues
- Provides accrual-based accounting and financial reporting services and handles fee collections, invoicing, and day-to-day administrative service
- Prepares and provides monthly and annual financial reports and maintains auditable records of transactions
- Assists with capital improvement loans and assessments and provides oversight, coordination, and administration of capital improvement projects
- If not onsite, visits regularly to review property conditions. Manages onsite staff
- Ensures that all state and local regulations are met, that the property meets compliance regulations, and required certificates are posted
- Assists with neighbor disputes, as needed
Also, in many cases, the property manager is the face of the building. Therefore, it’s important that his/her working relationship with board members as well as residents is a productive and solid one.
When it comes time for your board or association to hire a new property management company, how can you best evaluate candidates and be confident in your choice? Here are a few guidelines to help you select a residential property management team you can trust to best serve your community’s interests.
- This is the obvious place to start. Speak to real estate agents, property owners, residents, and board members at other communities.
- Attend a property management company event or trade show. Many cities host trade shows that are open to the public. Property management companies often have booths at these events, and you can easily gather a lot of information in one day.
- Peruse property management company publications. You will certainly find these at trade shows and expos.
- Go online. Every property management company has a website. Check out the services they offer, see how large they are, and read testimonials. You can learn a lot about a company in the way they present themselves. Check social media, including LinkedIn.
Once you have a list of companies to consider, you will need to generate a request for a proposal. Below are some things you want to know more about:
- Experience and reputation. How long have they been in the residential property management business and how are they regarded? You want a company that you can trust and has a long history of success.
- How many communities does the company manage – and would your property manager be in close proximity? Many of the larger management companies are headquartered in a city but have smaller regional offices out of which they service the properties in those areas. You want a property manager based locally so he/she can be on site quickly if needed (a flooding basement can’t wait) and has a trusted network of local vendors that will respond quickly.
- Get a list of the properties they manage and hit the road. Look to see if the grass is cut, the leaves are raked, and the snow is plowed. Remember: you want a property management company that will enhance the value of one of your most major assets and ensure your community has curb appeal.
- Luxury residences may want “lifestyle services” – for example a full time, onsite concierge. Make sure the company can provide the hospitality services your residents expect.
- Look for state-of-the art property management accounting and software which enables unit owners to communicate electronically through a management portal.
- Snoop: do many of the senior staff and portfolio/property managers have high-level industry certification? Look for the acronyms CPM, CMCA, AMS, and PCAM – these are among the top designations, for managers, in the property management industry. If many do, that is a sign that it is a solid, well-run company – or those very qualified people would go elsewhere. Additionally, you should only consider companies which possess an AAMC or AMO designation as these important designations demonstrate the professional capabilities of the management company.
Trim down your list to top candidates and then meet.
- Interview the portfolio or property manager who will be in charge of your property; you want to meet your point person – the person who will be accountable.
- Make sure their proposal is specific to your property and addresses the things you’ve discussed. This is a good time to make sure they are paying attention!
Finding the right property management company will take some time, to be sure. But in the long run, a residential property management company that is a reliable and trustworthy partner to your board of directors or homeowner’s association is worth the effort. A well managed, well maintained community goes a long way toward keeping property values high and residents happy – your ultimate end goal.
By Michael A. Feltenberger, CMCA, AMS, PCAM
Michael is responsible for the day to day management of Barkan Management’s Tysons Corner, Virginia office and has more than 25 years of experience in common interest community management. In addition, he has obtained the Professional Community Association Manager (PCAM), Association Management Specialist (AMS) and Certified Manager of Community (CMCA) designations from Community Associations Institute (CAI). He previously served as a member of the Washington Metropolitan Chapter of CAI board of directors and a member of the National Association of Professional Community Managers (APCM) board of directors. Michael has lectured locally and nationally on issues related to common interest communities.