An interesting read by Charles Hanes about the role of the service companies in new condos (i.e. the property manager, "concierge", etc...). What are people's opinions on this; Fear mongering or does he have a point?
Iâ€™ve got tons of documented proof to support the following statement: â€œNo matter what the price point, developers are absolutely committed to meeting ONLY the MINIMAL STANDARD of construction qualityâ€. Weâ€™ve got settled disputes where the developerâ€™s litigator insists on â€œminimal standardâ€ even when it comes to settling legal deficiency disputes. The best that you can expect is â€œMINIMUM STANDARDâ€ unless the documents specifically say otherwise.
You will not find this in any of the glitzy sales and marketing materials that they spend tons of money on to get you to buy the condo from them. Now, all these â€œminimum standardsâ€ come in two forms, visible sub-standard workmanship and mechanical substandard workmanship.
Now remember, the property management company has been brought in by the developer thus the property managerâ€™s loyalty will rest with the developer who gives them the contract (and who want to job on their future buildings as well) thus their loyalty is undivided.
This works the same with the security guard company. Oh, you donâ€™t realize this term? Well, when you were buying it was called the â€œExecutive Concierge Serviceâ€ (that would stand the building apart) but the developer never had any intention of fulfilling that representation (promise). During the construction period they need security guard companies to watch the site and try to minimize theft of construction materials. When the building occupies the developers never hire a concierge company (most are going broke because they canâ€™t find work in this town) but simply leaves the security guard company in place.
It is said that many developers receive kick backs from property management companies for these contracts but thatâ€™s fodder for another article. The point is that you never get your concierge and you get to live with a security guard in your lobby (no training as a concierge or people skills or subtle understanding of the expectations of a concierge job). Oh well, condos are the science of compromise all right!
The same applies with the superintendent usually as well. Now, I donâ€™t have anything against any of these supposed roll fillers but my 30 years of experience has shown me the best first step for a newly formed condo board is to replace all three roll fillers immediately at the turn over meeting (or at least give them notice at that meeting as their contracts usually have a 60 day notice clause).
I am continually bombarded with complaints by developers unable to find â€œa good property management companyâ€. I know of a few decent ones but they are few and far between. I know a couple of terrible property management companies and right up at the top of my list of nightmare property management companies is indisputably Brookfield Residential Services Ltd.
I have had first hand experience with Brookfield and they have proven themselves absolutely untrustworthy and incompetent. They worked with the board of a condo that I resided in and in the first year of operations the condos budgets literally doubled under their management or should I call a spade a spade â€œmismanagementâ€.
We finally had a new board elected the second year and they fired Brookfield (we were not the only condo board getting rid of them) but significantly, when we told Brookfield that we were auditing the budgets, they immediately and mysteriously found a $12,000 discrepancy (to the boardâ€™s favour) in their books! Imagine that someone so conscientious that they would do their own audit before handing things back over to us and fortunately finding the $12,000 overpay to them before we did which might have led us to form the conclusion that they were taking money from us that was not authorized.
This is all why it is so important that your condo corporation get it right the first time out of the box! Brookfield and the â€œshill boardâ€ (board manipulated by the developer at the turn over meeting). It took two more years to work things out at that condo so the owners suffered for three years under highly questionable management tactics at the hands of Brookfield and the corrupt board before getting costs under total control. Maintenance fell by 50%.
The shill board and the developerâ€™s loyal property manager (â€œBrookfieldâ€) allowed the mechanical audit (a very important aspect of a condo turnover) to be deferred almost a full year. It should have been undertaken no later than six but preferably three months into registration to allow sufficient time to remedy deficiencies found in the audit. Of course, Brookfield and the corrupt developer manipulated things together that insured that the Mechanical audit wound up after the full year under which time the developer is held accountable. They simply refused to settle the deficiencies requests submitted by the new board and passed the blame onto the old board.
All of this could have been avoided had the owners taken control of their and their condoâ€™s lives by doing it right the first time! The refreshing things is that doing it right the first time is easy! You replace absolutely every contract (property manager, security, maintenance) immediately upon bringing on the original board of directors.
It is also critically important to realize that if you donâ€™t terminate all those contracts, immediately they become permanent and things like the security guards become very difficult and costly to terminate after the fact. You absolutely need your property management company, security company and superintendent accountable and loyal to the owners without equivocation!
I absolutely guarantee you that if you swear by this one simple rule (fire them all) your condo and life experience will benefit immeasurably. If you donâ€™t, then your condo is destined to flail around in the disappointing mediocrity that consumes a decided majority of condos in Toronto.
The quality of your condo experience really is tied directly to what you are prepared to do to make it a better place. Your condo is a reflection of you!