Create a realistic budget that protects the financial health of your community.
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If you’re on the Board of a condominium, high-rise or homeowners association, you know that keeping your association’s finances healthy is one of your chief responsibilities. Keeping high levels of service while trying to save money and get the best deals possible is a hard line to walk. While any amount of savings is a win, what if you could save a lot? Like one association that saved hundreds of thousands of dollars in landscaping costs? Or the one that is saving tens of thousands each year on its electric bills?
Taking a look at communities that have been able to save significantly, we found one commonality. No matter the size or property type, communities that saved money all had a partnership with a quality property management company.
If your community is currently self-managed, you may see bringing in a property management company as spending more money, rather than saving it. Check out the numbers below – working with a quality property management company can save enough in other areas to outweigh those initial expenses.
If you already work with a property management company but aren’t satisfied with the value you’re getting, you may discover some tips below, things that your management company should be doing to maximize your operating budget and keep your association fiscally fit.
The right property management partner should do the following for your community:
1. Negotiate with your vendors on your behalf.
Finding the right vendors is hard work! It takes a lot of effort and time to vet them, send out RFPs, review bids, interview them and determine who will be the best fit for your community. After all that comes the negotiation process! Sometimes vendors that seem like a fantastic deal in the beginning can nickel and dime your community over the course of a project. Or – and this may be worse – they stick to their price but under deliver in quality or service or don’t complete the job on time or properly.
The best professional management partners have existing, long-term relationships with great local vendors. They are also experts at negotiating the best rates for your community and getting you value-added savings. FirstService Residential’s Value Engineering department, for example, can examine your vendor contracts and find places that your community can save money through negotiated pricing or get better service for the same money. One community in particular, was able to save a total of $264,000 per year by carefully reevaluating many of the community’s contracts. From janitorial service to security to insurance, the team was able to secure lower rates from the community’s vendors, without sacrificing quality or service.
2. Execute cost-benefit analyses.
It’s important to understand how much your association is spending and what the return is on that expenditure. Are you better off to hire janitors on your staff or to outsource that to a vendor? What about pool maintenance services and engineering?
A professional property manager for FirstService residential had to address these exact questions when she was making a decision for the community she managed. Thanks to her in-depth cost analysis, she discovered that her community could hire people and save money while increasing service hours and the number of employees, compared to using a third-party supplier. After presenting the results of her study to the Board, she worked to hire and train a qualified, professional team to work in the community. Her efforts saved the community more than $25,000 per year. Having staff in-house also means better preventative maintenance efforts, which reduces the frequency of equipment breakdown and larger, more costly repairs.
The right professional property management partner will offer this kind of personalized, proactive service to your community.
3. Examine energy usage.
Did you know that you can get your building audited for energy usage? Many local utility companies offer audits to customers. FS Energy, an affiliate of FirstService Residential, can also assess your energy use and compare it to other similar buildings. These audits will point out the ways your building is wasting energy and suggest solutions for them. Skypoint, a high-rise in downtown Tampa, Florida, has already saved tens of thousands of dollars in energy costs by replacing all of the lighting in many common areas with more efficient and effective means of lighting. The energy savings not only paid for the update, they earned Skypoint an award from the Florida Public Service Commission.
4. Seek out grants when available.
Does your community have needs that you can’t fund right now? For some issues, like planting trees, beautification and projects that will save energy or water, you might be able to get a federal, state, municipal or private grant to help. It takes time and effort to find the right grant, and many applications are complex. But it can be worth that effort to get important improvement projects funded. The right property management company will have the resources to do the research and navigate the grant application process.
These are just a handful of examples of how communities are saving thousands of dollars annually, thanks to partnering with a professional property management company. To find out how the experts at Georgia’s leading property management company, can help your association stretch its dollars, contact FirstService Residential today