5 steps to the best Florida reserve study company

What is a reserve study?

A reserve study is a report about the condition and likely useful life of all the major components in your building or community. In a high-rise, major components include things like the roof, plumbing, waterproofing, exterior painting, garage gates and access systems, HVAC components, elevators, trash compactors, and boilers; in a homeowners association (HOA), they might include the gate system and pool pumps.

The reserve study also contains a recommended schedule for repairs and replacements (i.e., capital improvements) that will be needed over the next 30 years, estimated costs for these projects, and a recommended funding plan. All of this information allows your board to set aside money year over year so you can pay for the work when the time comes. (To learn more about capital improvements and the role of reserve studies, download our guide to mastering capital improvements.)

The laws that govern association reserves may change rapidly as legislatures respond to changing market conditions. This article is not intended to and does not constitute legal advice or create an attorney-client relationship. Board members should consult their association’s attorney to discuss the legal implications of their decisions or actions prior to proceeding.
 

What is a reserve study company?

A reserve study company is the specialized firm that inspects the physical condition of your community’s major shared components and helps the board plan financially for future repairs or replacements. Buildings 3 stories or taller will need to hire a reserve study company with a licensed engineer, licensed architect, or person certified as a reserve specialist or analyst by the Community Association Institute (CAI) or the Association of Professional Reserve Analysts (APRA) to perform the visual inspection portion of the study. Your management company can help you find qualified and licensed reserve study companies that can help meet this requirement.
 

Benefits of hiring a reserve study company

Working with a qualified reserve study company gives your board the insight and confidence needed to plan ahead. A professional study can help take the guesswork out of long-term budgeting and helps your community avoid financial surprises:

• More accurate planning: A reliable reserve study outlines when major repairs will likely be needed and what they’re expected to cost, helping your board build a timeline and funding strategy that makes sense.
   
• Objective insight: An outside expert offers an unbiased look at the condition of your property’s key components and flags issues your team might miss.
   
• Support for board decisions: A thorough, third-party study provides the backup you need when explaining funding decisions to residents or planning future assessments.
   
• Peace of mind: With a solid reserve study in hand, your board can move forward knowing you're planning responsibly and protecting the long-term health of your community.

Partnering with the right reserve study company means fewer unknowns and better decisions, for today and for the years ahead.
 

How to find the right Florida reserve study company

A reserve study is only as reliable as the company behind it. To avoid gaps in planning, or costly surprises down the road, it's important to choose a reserve study company that understands your property, your board’s goals, and how your community operates. Here are five key steps to help guide the process:

1. Start with a few options.

   Like any association vendor, you should work with your management company to vet potential candidates. Maureen Connolly, client accounting business partner, said, “Start with 3 or 4 companies that seem like a good fit for your association. You can find a potential reserve study specialist by contacting engineering companies that have previously worked on your property.”
    

2. Paint a picture of your association.

   To produce a useful and accurate reserve study, the company will need a full understanding of your building or community’s size, layout, systems, and financial position. That means sharing the basics like age, square footage, number of units, and amenity details, as well as your maintenance records and a list of recent or upcoming repairs. You’ll also want to provide your most recent reserve study and your current reserve balance so they can start with accurate, up-to-date information.

   "Your community or building should have a subject matter expert who can answer detailed questions,” Connolly suggests. “It may be your manager, a veteran board member, or someone who has served on the board before."
   
   Maureen Connolly, client accounting business partner

   Connolly also added that if the reserve study company doesn’t ask these types of questions, they shouldn’t be entrusted to conduct your reserve study.
    

3. Ask the right questions.

   Be prepared to interview the reserve study company representatives by having a list of questions ready to go. Of course, you know to get the basics you’d ask of any vendor. Beyond that, there are a few additional questions you’ll want answered.
    
   • What time commitment does the company expect from your association? “Another red flag to look out for? When the company wants to work on your reserve study alone, without your board’s input,” said Connolly. “The process of putting together a reserve study involves a lot of collaboration. It requires input from both your board and management company.”
      
   • How much time will the company spend on the site inspection? You need to know how long you can expect the reserve specialist to be onsite and how many times they will come back to check information.
      
   • When will you be able to complete the reserve study? Because of new requirements (like the study for structural integrity), many reserve study companies are backlogged. It’s important to understand their timeline and yours, so that you are able to complete the necessary steps to remain in compliance.
      
   • What’s included in the reserve study price? It’s important to find out how many revisions the company will make to the study before adding fees. Be clear on price and what actions will incur extra costs.
      
   • What will the study look like? Get sample copies of the company’s reports. Different associations prefer different formats, and you should be comfortable with theirs. Connolly said, “Some companies don't include a reserve study review meeting in their pricing structure. You should have one so you can sit down with the reserve specialist to ask questions about the final report. 



4. Check their references.

   Once you’ve met the companies you feel might be right for your community, the next step is to check their references. Talk to at least 3 other communities for each company you’re considering. Don’t be shy about getting in touch with other properties they’ve worked with to get their opinions about the quality, price, and speed of the work. How many other companies did the board consider? Why did they make this final choice? Did they wish the company had done something differently? What did the company excel at?

   "It’s important to know how the company handled issues and challenges when they arose. When challenges arise, a reserve study company must be proactive and calm under pressure."
   
   Maureen Connolly, client accounting business partner

5. Compare and contrast.

   Spreadsheet lovers will take this one on happily. Create a matrix with everything you want on the columns and what the companies offer on the rows. Who comes in at or under your budget? Who will get the job done on your timeline (or sooner)? Which company expects the same amount of board and management involvement that you want to provide? Once you have your matrix completed, it becomes a simple chart of pros and cons. You now have all the tools to make the call on which company is the best for your community.
   
   After your reserve study is finished, you should feel confident about financial planning for your community. A thorough study will help you set up your maintenance plan, save for repairs and replacements when needed, and help keep your community or building financially healthy for years to come.

If you need help finding the right reserve study company for your community, contact FirstService Residential today to learn how our property management team can support your board every step of the way.