Reserve Study Costs $$$

PeterB1
Your question is interesting, Peter. I ran it by Jonathan Juffs, the co-author of our book, (Jon is a full-time, professional reserve planner) and these are some of his remarks.

Jon said … First of all … “there is no inspection of the homes and their associated individual amenities. That leaves things like the common roads, lighting, sanitary systems, storm drainage, water works, the tennis court, pool, party building (and its shell and appurtenances). Most of these components are buried and should not be overlooked. The recommended reserves plan may justifiably include a contingency amount earmarked for these components”.

“In Ontario, where we work, reserve fund planners are relatively un-regulated, and our rate would be something like $3K to $5K depending how remote the property is, or complex the actual unit boundaries are. If your state has rigorous requirements imposed by the professional engineers or insurers, it may be that your costs reflect higher rates than ours. In my opinion, your lower-end quotes seem to be about right — the upper end is too high”.

“The 2 or 3 days of site time does seem excessive. However, some clients tend to greatly underestimate the amount of office time spent quantifying and costing the numbers. There may be some trade-offs”.

Hope this helps a bit, Peter.

HeatherB2 - You said it, you have few common areas. The amount of homes (if they are indeed single-family free standing) is irrelevant except for the fact that the $530 expense per unit is divided by 80 of $6.25 per unit/home. In PeterB1's case the cost per unit for his association's study could cost from $33.00 - $67.00. Money well worth the expense as a budgeted line item.

HeatherB2, I do not concur that PeterB1's study sounds steep, or is steep for that matter. Your association is apples, he is oranges, no comparison.

PeterB1 - I strongly recommend you get a copy of Graham and Jonathan's book. It will assist you and your association in developing a broad 'Scope of Work' for understanding the importance and components of a quality Reserve Study. 2-3 days for a 10 acre site with outbuildings and infrastructure may need to be increased. Budget for the most that you can in a Capital Reserve Replacement Analysis, and Deficiency of Element Study according to industry and building code construction standards. Try not to create a special assessment to raise the funds for the studies, rather try to eliminate or shave off as much discretionary spending as you can and budget for the expenditures.

Best of Luck!!
Gerald

We recently had our 168 unit townhome community undergo a reserve study. We have 22 buildings that comprse the units, a pool area, detention pods, roads, mail room area and the common grounds, probably 8-10 acreas. Our cost was $3,000.00. My community is in Brandon, Florida (Hillsborough County). It's a very comprhensive report and shows us just far off we are in our reserves thanks to a builder and first management company that set our monthly assessments wayyyyyyyy to low.