How should a condo board approach hiring a property manager?
The selection of a property manager is an important decision that needs to be weighed carefully and planned wisely, as management plays a crucial role in running the day-to-day operations of a condominium.
Unless a corporation was self-managed, or the existing manager quit, chances are the reason the board is selecting a manager is due to its termination of the existing manager. In selecting another property management firm, the first thing a board should consider doing is objectively evaluating what aspects of management it liked and what aspects of management need to be improved upon. The following checklist of additional considerations will help to guide boards through the selection process.
1. Determine whether the board will oversee the selection process on its own or hire an independent consultant to assist it. A primary consideration is how much time the board has to attend to this important task.
2. Decide whether to hire management as an independent contractor or as an employee. An important question to answer is: Does the condominium corporation want to assume all the legal obligations of an “employer”? Management companies are generally hired as independent contractors.
3. Research the manager’s reputation. Ask prospective managers for references and follow up on same. Also ask the corporation’s other service providers to recommend good managers.
4. Evaluate the experience and credentials of the manager, and if a company, the experience and credentials of its employees who will ultimately be providing the management services, such as the senior manager and on-site manager/administrator. Experience should be considered in terms of condominium management as whole, as well as specific to the type of community in question, whether a townhouse, high-rise, commercial or mixed-use development.
5. Obtain a clear and exhaustive listing of all fees a manager charges. Manager’s fees are negotiable, so examine them. The board should also ascertain a manager’s expectations as to property coverage, time off for learning or professional development, off-site staff meetings, sick leave, etc.
6. Consider whether the manager will be a good fit for the community. The board should meet with prospective managers who make its short list of candidates.
7. Before making a final selection, review the manager’s proposed contract (or have a lawyer review it) to ensure that it accords with the board’s expectations.
8. Verify industry designations, for both property manager and management company, as well as insurance coverage (e.g., fidelity, liability, etc.).
Robert Buckler is a condominium consultant at Beredan Management & Consulting Inc. and realtor at Century 21 Heritage Group. He can be reached at email@example.com. Karen Kisiel is a Toronto-based condominium lawyer. She can be reached at firstname.lastname@example.org.