SHOULD WE HIRE A MANAGEMENT COMPANY?

Started by RichardE2 • 9 replies • 1361 views

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RichardE2 (Florida)
Posts: 6

Posted:

We are an HOA of 267 single family individual lot homes,Bryn Mawr Villiage, Orlando Fla.

We have had a CAM performing all duties for the assn. for the past 14 years. We have had the same attorney and CPA for this period. Our financial position is extremely good with reserves and capital investments of about $100,000 and no debt.

Our annual budget is around $155,000.

Our annual assessments are currently $50 per month. Our common areas include several acres of lakeside(2 lakes),tennis courts,2 pools,Clubhouse with kitchen & office.

Our board is elected annually. The current board has sat for the past 3 years with 1 or 2 substitutes.(hard to find someone to give the time required)

The current board has decided to investigate the possibility of turning over all functions to a management company. Many of the homeowners are afraid we will not have the hands on we currently have with a CAM on location.

Our Cam is currently being paid $28,000 for 25 hours per week on site.

Please share your experiences GOOD or BAD with Management Companies.

DonaldM3 (South Carolina)
Posts: 132

Posted:

Richard,

I’ve been on boards in both a small (20 units) and larger (250 units) HOA. It’s really nice being self managed; I really liked that! I would not, however, consider serving on a board of a HOA of over ... say 50 units unless there were really some great people on the board with most of them being retired; it’s just too much work. If, however, you were already doing it and it was working for you, I’d say stay with it.

AnnaD2 (Florida)
Posts: 960

Posted:

Richard, if it ain't broke don't fix it. Right now it sounds like you have a good thing going. I'm sure that having an on-site CAM gives you a much better sense of what is happening with your assets, what needs to be done, and better communication.

Finding a good management company (especially in Florida) can be difficult. The huge companies often promise you the world and present a very glossy picture of what they claim they'll do for you. But after a while you're simply a source of income for them, communication becomes difficult or it ends completely, you start to have questions about where your money is going and things that you need answers to get ignored because they're just not important to them.

We went through years of pure hell with two previous management companies. Luckily we now have a very small company working for us and they've been terrific. It sounds like what you have is a good situation.

AnneH2 (Florida)
Posts: 82

Posted:

I don't think I would make any change. It sounds as though things are going well.

What issues are you all looking to address by considering hiring a PM company?

RichardE2 (Florida)
Posts: 6

Posted:

Board members interested in any possible operating cost savings. I don't think enough consideration is being given to the assn homeowners having control of finances operations.

Thanks for your input. I really wanted to hear actual experiences with Management Companies on a daily basis. So far I've only heard devasting senarios after losing control of the Assn.

RussS (Florida)
Posts: 16

Posted:

You folks are doing a great job. Good reserves and no debt. I know of a 450 HOA with little or no reserve, and there are many more here in FL in bad financial shape. I think if you hire a PM company and are hands off (for the most part ), that reserve will soon disappear. Then try to sell the need for big asessments to the homeowners to get it back.... That will be tough. I don't think you will reduce cost... Good luck and congratulations!

PeterB1 (Florida)
Posts: 257

Posted:

Richard,

What does your employee do on site for 25 hours/week? We are self-managed (130 homes) and the idea of bringing someone in to respond to homeowners and contractors sounds appealing.

But, 25 hours seems like a lot. Can you describe a scope of the job?

Thanks.

RichardE2 (Florida)
Posts: 6

Posted:

The CMA's hours are basically 9am to 1pm monday-friday in the office to be available to homeowners. However the scope of her duties include the complete business operation of the HOA;writes checks,collects and deposits monies, reports monthly financial activity to contract Bookeeper, property inspections, documents and files ARB and other requests and contacts,maintains complete activity file on each property, obtains bid quotes,verifies
vendor's qualifications, has contacts with city representatives,notices homeowners on violations,supervises maintenance and cleaning personnel,verbal and written contacts with Attorney concerning delinquent HOA dues for lein's and forclosures.

There are many other duties not mentioned, however you can see that our CMA gives complete management for our HOA, with Board oversight.

I believe the most important activity our CMA provides is advisor to our 7 member Directors Board concerning compliance with Florida Statutes,and City and County Ordinance requirements. It seems that our Board is forever changing and most people that serve can offer a little expertise in their field of work.

Thank you for your response.

MarkR6 (Florida)
Posts: 2

Posted:

I see stories of management companies draining funds from the HOA's. To me it sounds like they gave full financial control and then forgot about it. I thought you paid them monthly for all services, retained all current vendors and the Board still continued to oversee.

MarkR6 (Florida)
Posts: 2

Posted:

Quote:

Posted By MarkR6 on 03/18/2009 5:30 PM
I see stories of management companies draining funds from the HOA's. To me it sounds like they gave full financial control and then forgot about it. I thought you paid them monthly for all services, retained all current vendors and the Board still continued to oversee.

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