The Elizabeth Board held a special meeting of the Board (as opposed to the usual monthly Board meeting) on January 14, 2009, to vote on the next step in its process of exploring the procurement of services from an outside management company. In attendance were all seven board members and about 60 people of the Elizabeth Condominium Association (ECA).
Based on various reports from those who attended, here are some of the highlights of what our Board president, Woody Cunningham, said:
• He outlined the process that the Board has been engaged in for the past six months. This has included talking to neighboring condo associations, meeting with representatives from several management companies, both here in the Elizabeth and at their offices, issuing writing a Request for Proposal, receiving and analyzing proposals (with help from experts), entertaining a bidders’ conference at the Elizabeth, receiving bids based on what the responding management companies learned in the bidders’ conference, and generally learning about the new advances in the field of large building management.
• In the area of financial management, an outside management company could offer significant savings to the ECA because of state of the art software, a centralized system, and their handling of large sums of money through the banking system.
• In the area of personnel, a centralized Human Resource Department would help realize benefits associated with health insurance and pension plans.
• Building operations, maintenance & repair: a new approach would allow for refocusing the General Manager’s duties, allowing for better building functioning as well as back up resources should our usual operations personnel, including engineers, fall ill or have some other kind of emergency.
• Utilities: ECA might realize a cost-saving through the larger reach of a management firm.
• Communications: ECA would benefit from already established options for websites, electronic messaging, and news dissemination.
• Building insurance: possibility of getting lower rates because of large-scale operations
• Cost: this is complicated, because the expectation is that while there would be a significant five-figure outlay to hire a management company, there will also be significant savings that could balance out the cost of hiring a management company over the long term. The cost depends on many choices that will be considered. The bottom line assumption is that the cost of an outside management company will fit our budget, but no one has any hard and fast numbers at this time.
• Cost/Benefit Determination is required to make the best decision.
Some of the issues around moving forward with a management company involve:
• The cost.
• The long-time employees who currently work for the ECA.
The Board voted 4 to 3 to move ahead with discussion with an outside management company, and voted for discussions to be held with Legum and Norman. How this will play out is yet to be determined.
Some of the things I believe we need to keep in mind:
• As all property owners know, you must continually invest in your property to maintain and enhance its value as well as keep ahead of repairs, assure proper preventive maintenance, and make the necessary improvements. Failure to continually invest in, maintain, and improve the property will result in erosion of property value.
• Key personnel on our current staff represent valuable institutional knowledge and, despite the problems, the Board appreciates what the current staff has been able to contribute. The Board is considering all options: full self-management, full professional property management, and a hybrid of both.
• The business of running an enterprise like the Elizabeth Condominium has come a long way. We need to move into the 21st Century with our management approach. There is no reason why we should allow our communal home to fall into disrepair.
• In this time of economic downturn, we need to be mindful that property investment requires money for maintenance and upkeep. It’s that old adage about penny-wise and pound-foolish. We need to make sure we spend what’s necessary without going overboard so that our investment will increase in value -- not decrease in value because we did not properly maintain and improve it.
Constructive comments are welcomed.
No comments:
Post a Comment