Seven Tips to Finding a Reserve Study Firm
Your reserve fund is what helps your association anticipate its future– and budget for it, too. This fund gives you the power to maintain the quality of your community by allowing for projects that are both necessary and expensive (like a future roofing or paving project, for instance).
Needless to say, establishing this fund can get a little complex. But you don’t have to be a fortune teller to read the future of your association...you simply need a good reserve study firm to help. Here’s how you can find one.
1. Do some background work.First of all, any prospective firm you work with will want to know about your association. Collect information on your association and develop a complete description of it. You will need details like location, number of units, description of buildings, list of amenities, etc.
2. Find your firm.Searching for candidates is easy. Good property management companies maintain a list of qualified firms. You can also check with your local chapter of the Community Associations Institute or go to caionline.org.
3. Ask the right questions.Decide what criteria you’ll be using to evaluate your candidates. You will get a clearer picture of the end product by asking questions such as number of years in business, number of studies performed per year, company background, specific experience with communities like yours, funding methods, pricing methods, time it takes to complete the work, association involvement and types of guarantees. Identifying the most important factors when it comes to hiring a firm for your association will help you winnow down the candidates.
4. Make contact.Reach out to your candidate firms with a request for standard informational material, such as examples of previous reports. Then ask the questions you developed earlier, carefully recording the answers. As you interview more firms, you may find that your questions evolve as well. Don’t forget to request three references.
5. Compare.Your research is done; now it’s time to make your comparison matrix. Here’s a simple suggestion: make a spreadsheet that lists your hiring criteria in the left-hand column, then list your candidate firms across the top, horizontally. After that, use your research to fill in the boxes. At this time, you’ll also want your accountant to review the sample reports your candidates provided to make sure they meet your federal filing needs. When your matrix is complete, eliminate those that don’t meet your most basic requirements. The rest are up for evaluation.
6. Reach out to references.Contacting the remaining firms’ references should involve brief conversations. Ask simple questions such as whether the association was pleased with the firm’s work, whether their association is similar to yours, when the study was performed, if cost expectations were met, if the study was delivered on time, if there was something they wished the firm had done differently, whether they considered hiring other firms, what factors they used in choosing this firm, and whether or not they’d hire them again. Keep the list of questions to a maximum of ten. Be efficient, friendly and respectful of their time.
7. Decision time.You’ve identified candidates. You’ve interviewed them and eliminated the non-contenders. You’ve developed a candidate matrix. And you’ve reached out to their references. Now you have all the tools you need to make an informed decision.
Partnering with a reserve study firm can have a huge impact on the future of your association. Follow these steps and you’re sure to find yourself working with a quality firm that meets your expectations. For more help, contact FirstService Residential.
Start preparing for your community’s future needs now. Sign up to download our in-depth white paper, which highlights how to establish a sound budget and strategic financial plan, and learn how partnering with a property management company can enhance your residents’ property values and overall lifestyle.