Managing a high-rise community is far from simple. With a mix of rising costs, evolving legislation, and escalating expectations from residents, boards are tasked with balancing financial decisions and quality of life for their communities. The recent release of the 2025 BENCHMARK: High-rise report for high-rise communities sheds light on these challenges and provides a roadmap for navigating them through informed budgeting, strategic planning, and leveraging expert resources; fill out the form on this page to access the report. Keep reading to learn more key insights from the report's launch, as discussed by an expert panel from industry leader in property management, FirstService Residential.
 
High Rise Benchmark Report

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To help you navigate these complexities and stay ahead of industry trends, we invite you to download the BENCHMARK: High-rise guide by filling out the form.


During the panel, David Diestel, CEO at FirstService Residential, opened the discussion by introducing the BENCHMARK report, a tool designed to guide board members of high-rise communities through the complexities of their budgeting process. The report offers data-driven insights that compare costs across similar communities, empowering boards to make more informed decisions. Diestel also emphasized the growing importance of board members who dedicate their time and effort to creating long-term value for their communities while navigating the challenges of cost management and resident satisfaction.

The report serves as an important comparative resource for boards frequently asked by residents how their community's fees and expenses compare to others. More importantly, it shows the need for initiative-taking planning by providing regional and national benchmarks.
 
"All of you are community leaders— everyday heroes, representing the best long-term interests of all of your residents and the entire community."
 

David Diestel, CEO

Addressing rising costs

One topic that’s noteworthy for board members is the escalating cost of insurance premiums. Robert Smith, president of the South region at FirstService Residential, notes that in many markets, insurance premiums have driven substantial hikes in homeowner association (HOA)v fees—by as much as 60% in some areas like South Florida over the past five years. Other factors, such as wage inflation and utility cost increases, also contributed to the financial pressure. Additionally, newly enacted legislative requirements regarding reserve funding and building inspections in states like Florida are further intensifying these challenges.

John Lee, vice president of FirstService Financial, a subsidiary of FirstService Residential, explained that proactive communication with insurance providers is one of the most effective strategies to mitigate costs. Communities that invest in capital improvements and document their efforts in improving risk profiles often receive more favorable insurance premiums. Sean Ingram, senior vice president for the British Columbia market, echoed Lee's thoughts and highlighted the importance of implementing innovative solutions like water sensors and natural disaster-preparedness measures that not only enhance safety but can also lead to cost savings through discounts.
 

Reserve funds and preventative maintenance

Another major challenge for boards is reserve funding. CEO David Diestel noted that reserve contributions are on the rise across all markets. For example, legislative mandates in states like California and Nevada require specific allocations to reserves, which has pressured budgets. Smith then pointed out that reserve contributions in some communities have increased by over 100%, depending on historical funding levels and recent adjustments to meet current needs.

The importance of conducting regular reserve studies and sticking to long-term financial forecasts is crucial. Susan Ward Freeman, president of the high-rise division in Texas, stressed the value of preventative maintenance programs. Delaying maintenance can lead to costly repairs that impact budgets significantly. For example, she recounted an incident in one of the properties her team oversees where a sprinkler malfunction caused millions of dollars in damages—something that could have been minimized with better planning and technology.
 

Strategic budget planning for the future

A recurring theme throughout the realm of high-rise budgets is the importance of starting the budgeting process early. FirstService Residential property management experts encouraged boards to treat annual budgeting as part of a larger multi-year strategy.

Boards should engage key stakeholders—including general managers, engineering and financial consultants, and insurance advisors—early in the year to align goals and address potential hurdles. Freeman described these strategic discussions like creating a "report card" for the past year while projecting the vision for the future.

In addition to early planning, experts recommend boards conduct frequent check-ins throughout the year to adapt as circumstances evolve. Weekly or bi-weekly workshops focused on action items, financial health, and risk mitigation keep everyone accountable and on track.
 

Exploring financial solutions

With rising costs, some boards may find it necessary to explore financing options for large capital projects. Lee explained the benefits of securing loans instead of relying solely on reserves or special assessments, particularly when balancing operating costs with capital improvements. The key to securing favorable loans lies in providing lenders with a strong financial narrative, which involves demonstrating the health of reserves, outlining a realistic repayment plan, and highlighting initiative-taking investment in the community.
 

Enhancing resident experience with progressive amenities

High-rise communities face stiff competition as newer developments boast modern amenities and technologically advanced features. To stay competitive, boards must make timely investments in upgrades that enhance the resident experience.

Sean Ingram and others shared emerging trends in amenity spaces, encouraging boards to think creatively and strategically. For instance, multi-use design is gaining traction—spaces such as soundproof rooms can serve as study areas, media rooms, or practice spaces and provide utility for residents with different needs. Similarly, common areas might include wellness-focused features like meditation areas, saunas, and cold-water plunge pools, catering to the growing interest in holistic health.

Robert Smith also highlighted the increasing demand for pet-friendly spaces, package rooms with advanced tracking systems, and even food and beverage stations. These elements improve residents’ day-to-day lives while increasing the appeal of the community to potential buyers.
 

Tech and innovation

From building design to operations, technology is playing a larger role in how high-rise communities function. Marc Kotler, president of the New Development Group in New York City, illustrated how technological innovations such as water detection systems, energy-saving features, and smart building integrations have helped reduce operational costs while enhancing resident satisfaction.

For existing communities, Kotler stressed the importance of identifying creative solutions for modernizing older buildings to meet current resident expectations. For example, converting unused commercial spaces into lounges or fitness areas can elevate the value of such properties with minimal disruption to existing infrastructure.
 

Supporting all stakeholders

Additionally, bards aren't the only stakeholders navigating the nuances of high-rise management. Developers also rely on professional management teams like FirstService Residential to help balance design, cost, and operational reality. According to Kotler, getting involved early in the design phase can help that features like package rooms, utility systems, and layout plans align with future operational cost goals. Small design decisions, when made early, can have significant financial and experiential impacts on the building's long-term success.

Developers are increasingly focused on creating unique experiences for residents. Freeman highlighted a developer initiative that introduced transition-focused concierge services, extending care and personalized support during the often-stressful moving process. Such innovations help developers distinguish themselves while creating a lasting impression on residents.
 

Communication Is key

Effective communication is a critical factor across all discussions of high-rise budgeting. Boards face the dual challenge of making tough financial decisions while maintaining confidence and trust among community residents. Transparent reporting, frequent updates, and meaningful engagement with residents are essential.

Susan Ward Freeman stressed that explaining the "why" behind budget decisions—whether it's investing in capital projects, adopting new technology, or increasing reserve contributions—helps garner resident support. Boards that effectively communicate their vision for the future are more likely to earn trust and cooperation even when implementing difficult decisions.

 

BENCHMARK: High-rise report

The report offers communities a valuable resource for comparing costs and making informed decisions. However, the tools and insights provided will only be effective if boards adopt a proactive, strategic approach to planning and communication. Experts the following helpful pieces of advice for community leaders and boards:
  • Adopt a mindset of opportunity. See your HOA as a chance to create a positive resident experience and maintain property values, rather than just a financial obligation.
  • Invest in your community. Strategic investments pay dividends in the form of lower insurance premiums, happier residents, and sustained property values.
  • Be realistic and honest. Make financial plans based on accurate data and long-term goals to avoid sudden rate hikes or budget deficits.
  • Start early. Begin your budgeting process well in advance and continually update your plans throughout the year.
  • Collaborate. Lean on management teams, financial experts, and other stakeholders for resources, advice, and benchmarks. You’re not alone in this process.
By starting early, communicating clearly, and planning for the future, boards can successfully tackle the challenges of managing high-rise communities in today’s complex financial landscape.

To help you navigate these complexities and stay ahead of industry trends, we invite you to download the BENCHMARK: High-rise guide by filling out the form.

Contact FirstService Residential, the high-rise management leader, to learn more about services offered for high-rise living.

 

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