If you’re on the board of a condo, co-op, high-rise or HOA, you know that managing your community’s budget is a major priority. You’ve likely explored many ways to save money and get the best deals, while still maintaining a high level of service.
While even a few hundred dollars in savings is surely welcome, what if you could save even more? Like one association in California that saved over $25,000 a year in vendor contract fees? Or another that saved hundreds of thousands in landscaping costs?
We looked at communities across North America that had significant financial savings year after year and found that despite their vastly different sizes and property types, there was one thing they had in common: they all had a partnership with a property management company.
If your community is currently self-managed, hiring a property management company may seem like an additional expense, but as the numbers below show, the savings in other areas can outweigh the initial costs.
Already work with a property management company but remain unsatisfied with the value you are receiving? Read on to discover some things your residential property management company should be doing to improve your cash flow and stretch your budget.
A Great Property Management Company Should:
1. Access the best vendors – and negotiate for you
It takes time and effort to vet different vendors, send out RFPs, interview potential partners and select those who best fit with your community – not to mention the additional stress of the financial negotiations that take place once a vendor has been chosen. Oftentimes the vendors that seem like a great deal at first end up nickel-and-diming you as the project progresses. Or worse, some vendors may meet their negotiated price, but not complete the job properly, on time or may under deliver in terms of customer service.
The right property management company has built strong, long-term relationships with the best local vendors. This residential management company should also have vast expertise at negotiating better rates and scoring value-added savings. For example, Andy Larkin, CCAM, a general manager at FirstService Residential, North America’s leading property management company, was able to save his community a total of $264,000 per year by carefully reevaluating many of the community’s contracts. From janitorial service to security to insurance, Andy used his negotiation skills to secure lower rates from the community’s vendors, without sacrificing quality or service.
2. Be proactive about cost-benefit analyses
Is it more cost-effective to keep janitors in-house or contract a third-party service? What about engineering and pool maintenance services? Dawn Suskin, a professional property manager with FirstService Residential in California, had these same questions when she created an in-depth cost analysis between these two scenarios for a community she managed. She discovered that, in their case, hiring in-house staff could save money for the community while also increasing service hours AND the number of employees. Not only did she present the findings to the board, she then worked for months hiring and training a united and qualified team for the community.
This is the kind of proactive, personalized service the best property management companies should be offering your community. What was the total cost savings for Dawn’s community? Over $25,000 in hard costs per year including future added value. This new in-house staff means more regular maintenance, which lessens the frequency of equipment breakdowns and reduces the need for more costly, larger repairs.
3. Research and apply for grants for your community
Are there projects that your community desperately needs but you have been putting them off due to lack of funding? Did you know that there are often federal, state, municipal or private organizations that offer grants for residential community improvements? Brian Taylor did. An experienced FirstService Residential property manager, Brian noticed a rapid decline in the trees throughout the master-planned community he manages. The cost to replace them was more than the community could afford, so he took it upon himself to research, apply for, and secure a grant so that the community could complete the project.
While grants are publicly available, the appropriate ones take time to find, and are notoriously complex to apply for. The right property management company will know where to look, and take the time and effort to do what it takes to secure a grant for your community improvements. In Brian’s case, the process required research of different arbor groups and 14 months of extensive work with the state grant system. The results were worth it – his community was able to plant over 1,100 new alder trees throughout the property, at almost no cost to the residents.
These are merely a few examples of how community associations are saving thousands of dollars every year with the assistance of a great property management company. The professional property managers at FirstService Residential are experts at stretching a community association’s budget. To find out how your investment can go farther, fill out this short form to contact FirstService Residential today
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