How a smart financing strategy helps communities stay strong

A high‑rise, an unexpected report, and a decision no board wants to face

Picture a 22‑story high‑rise - sleek glass balconies, a lobby that smells faintly of citrus, neighbors who chat in the elevator about weekend plans. It’s the kind of building where people feel rooted. Then, one afternoon, the board receives the results of a required structural inspection. The news is sobering: the garage deck and several balconies need immediate restoration. The price tag is $7.5 million.

The reserves are healthy, but not enough to cover a project of this scale. The board - volunteers with day jobs, families, and limited time - must now decide how to fund the work. A large special assessment is one option, but it would land unevenly on a community made up of retirees, young families, and seasonal residents. The board wants to protect the building, but also the people who live in it.

This is not an isolated story. Across North America, aging infrastructure, rising construction costs, and new regulatory requirements are pushing residential communities into major capital projects. And increasingly, boards are turning to lending to manage the financial impact without destabilizing their communities or high-rises.
   

Special assessments are part of responsible governance - but they don’t have to be disruptive

Special assessments have long been a tool for funding major repairs, replacements, and compliance‑driven projects. They’re not a sign of poor planning; they’re a reflection of the realities facing older buildings and evolving safety standards.

But even when assessments are necessary, the way they’re structured matters. Boards want solutions that:

• Keep monthly assessments predictable
   
• Support long‑term property values
   
• Maintain community stability
   
• Treat owners fairly across income levels and life stages

Lending gives boards more flexibility to achieve those goals.
 

How lending helps communities absorb major projects without financial shock

Association loans allow boards to complete essential work while smoothing out the financial impact on homeowners. Instead of requiring a large lump‑sum payment, the association borrows the funds and repays them over time through a special assessment.

This approach helps boards:

• Gain immediate access to funds to complete the project in full
   
• Start projects sooner, avoiding cost escalation
   
• Spread costs across the useful life of the improvement
   
• Reduce immediate financial pressure on owners
   
• Maintain market confidence and resale activity
   
• Preserve reserves for future needs

In many communities, lending isn’t about avoiding special assessments, it’s about managing them strategically.
 

3 questions to ask when looking for a loan for your community

When a board begins exploring financing, the options can feel overwhelming. Terms vary widely. Lenders approach associations differently. And the stakes - both financial and structural - are high. Asking the right questions early helps boards cut through the noise and focus on what truly matters.

1. What will this loan mean for our monthly assessments, today and five years from now?

   Board members need to understand how a loan will affect owners month‑to‑month, not just in year one but across the full repayment period:
    
   • The projected monthly impact on assessments
      
   • How different loan terms change that impact
      
   • How repayment aligns with the useful life of the project
      
   • What happens if interest rates shift or the project scope changes
   
   This isn’t just financial forecasting, it’s long-term community planning.
    

2. Does the lender understand how community associations actually operate?

   Community associations, cooperatives, condominiums, and strata corporations are not traditional borrowers. Their revenue comes from assessments, their governance is defined by statutes and bylaws, and their financial structures are unique.
   
   Boards should look for lenders who:
    
   • Specialize in HOA, condominium, strata, or co‑op financing
      
   • Understand governing documents and assessment structures
      
   • Know how to evaluate delinquency rates and reserves
      
   • Have experience underwriting large capital projects
   
   A lender unfamiliar with this world can slow a project down, or derail it entirely.
    

3. How will this loan support the community’s long‑term financial stability?

   A loan should strengthen - not strain - the community’s financial foundation. Boards should evaluate:
    
   • Whether the loan preserves reserves
      
   • How it positions the community for future regulatory requirements
      
   • Whether it supports stable resale values
      
   • How sustainable the repayment structure is for owners
   
   The right loan helps the community complete essential work today while preserving flexibility for tomorrow.

Boards and managers are navigating a more complex environment than ever

Today’s boards are facing a level of financial complexity that didn’t exist a decade ago. CAI has highlighted a nationwide shift toward:

• More frequent reserve studies
   
• Mandatory structural integrity inspections
   
• Higher reserve funding expectations
   
• Increased transparency and reporting
   
• Greater fiduciary accountability

These changes are good for safety and long‑term planning, but they also reveal funding gaps that must be addressed quickly. And while community managers are experts in operations and resident service, they’re not capital‑funding specialists. Boards, made up of volunteers, often don’t have the time or expertise to evaluate lending structures, negotiate terms, or model long‑term financial impact.

For boards in self‑managed communities, or those working with property management companies that don’t have dedicated financial specialists, the burden of evaluating funding options often falls heavily on volunteers and their community manager. While managers are experts in day‑to‑day operations and resident support, they are not capital‑financing experts. As a result, boards may find themselves doing much of the legwork alone: comparing loan structures, modeling long‑term assessment impacts, and negotiating terms without specialized guidance. This can slow decision‑making and increase risk at a time when clarity and speed matter most.

This is where specialized support becomes essential.
 

How FirstService Financial helps boards and council members save time and money

FirstService Financial was created to provide boards and council members access to the kind of financial expertise that traditional banks and generalist lenders simply don’t offer. Community associations operate under unique rules, governance structures, and financial models. They’re not corporations, municipalities, or individual borrowers - and they shouldn’t be treated like them.

What makes FirstService Financial unique is its combination of scale, specialization, and alignment with the needs of community associations. Their team provides:

• Expertise in Homeowner associations, condominium, strata, and co‑op lending
   
• Access to competitive loan programs, at preferred negotiated pricing
   
• Financial modeling that compares loan structures and assessment impacts
   
• Guidance on repayment strategies that minimize owner disruption
   
• Support throughout underwriting and board decision‑making
   
• Consulting on the right loan structure to meet the community’s needs

Because they represent thousands of communities, they bring negotiating power that individual associations cannot achieve alone.
 

A conversation with Andrew Lester, president, FirstService Financial

We asked Andrew Lester, President of FirstService Financial, to share what he’s seeing as boards grapple with the financial realities of major projects.
 

What do boards worry about most when facing a major project?

"Boards are balancing a lot at once. On one hand, they know they have a fiduciary responsibility to address critical repairs or upgrades and protect the long-term value of the property.

On the other hand, they’re deeply aware that their decisions affect real people with very different financial situations. Boards worry about whether the solution they choose is financially responsible, defensible, and fair across the community - not just today, but years down the road. The pressure is especially high because these are volunteer leaders making decisions that can involve millions of dollars and long-term financial commitments."

—Andrew Lester, president, FirstService Financial
  

How does lending help with that?

"Lending gives boards flexibility. Instead of asking owners to come up with a large lump-sum payment all at once, loans allow costs to be spread over time in a way that aligns more closely with how residents budget month to month.

That predictability matters. It gives boards a way to fund essential work while reducing financial shock and avoiding scenarios where some owners are forced to sell simply because they can’t absorb a sudden assessment. A good loan structure also allows boards to match repayment with the useful life of the project, which helps keep things equitable between current and future owners."

Q: Are boards becoming more open to borrowing?

"Absolutely. Over the last several years, lending has moved from being viewed as a last resort to being recognized as a legitimate planning tool. Boards are facing higher construction costs, stricter safety and inspection requirements, and more scrutiny around reserve funding.

In that environment, borrowing isn’t about avoiding responsibility - it’s about managing it thoughtfully. We’re seeing more boards include lending as part of their long-term financial planning, alongside reserves and assessments, rather than waiting until they’re forced into a decision under pressure."

Q: What do boards often overlook?

"Timing is the big one. Many boards don’t realize how much leverage they gain by starting the conversation early. When boards explore financing options before a project becomes urgent, they have more choices, better terms, and more time to communicate clearly with owners.

Waiting until a repair becomes critical often means higher costs, fewer options, and rushed decisions. Starting early allows boards to model different scenarios, align financing with reserve strategies, and move forward with confidence instead of urgency."

Q: What’s the most common question you hear?

"By far, boards want to know how a loan will affect monthly assessments. That’s the question owners ask first, and boards need a clear, defensible answer. It’s not just about the first year -  boards want to understand the long-term impact, how different terms change the monthly number, and whether the structure is sustainable for the community as a whole.

Clear financial modeling turns an abstract loan discussion into something tangible, helping boards explain not just what they’re doing, but why it makes sense."

Real communities, real decisions, real impact

"The loan helped us complete the project without overwhelming our owners."

A 300‑unit condo needed a $10 million structural restoration.

"The loan allowed us to move forward confidently. Owners appreciated that we found a balanced solution."

"We kept monthly assessments predictable and protected resale values."

A high‑rise used a loan to avoid a large lump‑sum assessment.

"Buyers stayed confident, and owners stayed current. It kept the community stable."

"The financial modeling helped us make an informed decision."

A strata corporation evaluated multiple funding options.

"Seeing the long‑term impact of each scenario helped us choose the structure that best supported our owners."

Financing support for FirstService‑managed communities and high-rises

Board and council members in FirstService‑managed communities can request a complimentary financial assessment and tailored loan options directly through their community manager, or complete this form to schedule a call with our lending team.
 

Guidance for boards planning what’s next

If you’re a board or strata council member exploring long‑term planning for your community - or navigating a complex capital project today - our team is available for a no‑obligation conversation about your goals, challenges, and financing options. Complete this form to connect with us.