Choosing a Management Company

Choosing a Management Company

From time to time, a condo association may evaluate their management company and consider whether or not they are getting appropriate value.  Often, this is due to problems with the present management company’s performance.  Other times, board members determine that it would be worthwhile to explore other options in the marketplace.

There are a number of resources that propose ways of selecting a management company.  Industry trade groups (such as the Community Association Institute) and condo law firms have RFPs (Request for Proposals), which ask questions that purport to help in identifying the best qualified companies.  We would submit that often these tools are more valuable to the members of the industry trade groups, than the HOA that is considering new management.

Some associations define what they are looking for in terms of differences from their present company that they are not satisfied. Typical of the issues that boards want improved are things like:

  • Better communication.
  • Return phone calls.
  • Reduce property manager turnover.
  • Tracking of Repairs.
  • Follow-up.

Based on what we have seen talking to boards looking for a new management company, we find this approach to be very limiting. We hope the information presented below will be beneficial in terms of providing a better selection process. We might also emphasize the approach we recommend is consistent with the order of management functions as articulated by noted management author Peter Drucker — planning comes before staffing. We believe it is helpful to do the planning before selecting the management company.

Regardless of the reason your association is looking for new management, we would propose the following guidance in the selection of a new condo association company.

  1. Define the Goals — Focus on Results

This is the First Step.  Below is one possible Goal.

Reduce Operating Expenses by 15% within 2 Years

Most HOA management companies suggest that their management will result in some undefined “savings” that supposedly come from energy contracts, bulk insurance purchases, some kind of purchasing leverage due to their size. But the reality is that since most companies are doing this, changing companies is not likely to result significant savings – if there is any savings at all.

There are numerous well maintained condo buildings in Chicago managed by companies such as DKCondo, Sudler, FirstService Residential, and Associa.   Thus, one can reasonably say that these companies are getting the job done — buildings are beautiful and everything is working — but, at what cost? In management, getting the job done is one measure of management performance – the other is efficiency. Though not a definitive measure, we believe that the Assessment to Property Value Ratio is a key metric in determining management performance. Alternatively, one might reasonably ask what happens to a property when the owners refuse to go along with an assessment increase?

Of course a prudent HOA board would not want to reduce operating expenses that result in corners being cut, such as deferring maintenance or a reduction of service that that adds real value to the association. The opposite is more likely true – reducing operating expenses can free up money to invest in needed capital improvements, enhance amenities, increase the reserve accounts, or actually increase valuable services.

Thus, we would submit that one of the most important considerations in selecting new management is to evaluate the company in being able to measurably reduce operating costs – while increasing quality.

From time to time, a condo association may evaluate their management company and consider whether or not they are getting appropriate value.  Often, this is due to problems with the previous management company’s performance.  Other times, board members determine that it would be worthwhile to explore other options in the marketplace.

There are a number of resources that propose ways of selecting a management company.  Industry trade groups (such as the Community Association Institute) and condo law firms have RFPs, which ask questions that purport to help in identifying the best qualified companies.  We would submit that these tools are more valuable to the members of the trade groups, than the HOA that is considering new management.

Regardless of the reason your association is looking for new management, we would propose the following guidance in the selection of a new condo association company.

Management Options

Learn the Options

Evaluating Trade-Offs

Does it Make Sense

Be Realistic

The RFP

Frequently, a board considering new management will develop an RFP (Request for Proposal) to help them select a new company.

Condo Management with Better Results

Effective condo management results in Better Quality, Better Value, and Fewer Headaches for board members.   Enlan delivers results.

Real property management involves more than making phone calls when something goes wrong.  Our company serves condominium associations with a more traditional management approach — using the tools of professional management (planning, organizing, etc.), to deliver improved quality and efficiency.

Condominium Management Based on Stewardship

Enlan Condominium Management serves condominium associations based the principle of stewardship.  Stewardship is an old concept that refers to taking care of someone else’s property as if it were your own.  Condo board members can take comfort in knowing that someone is looking out for their property in a manner that reflects their values.

Our condo management approach respects the homeowners’ investment in their property, and the valuable time of board members providing volunteer service.  We call this 360 Degree Value.

The CondoManagement360™ Program 

We deliver a complete condominium management program to enhance L-T value, predictability, fairness, consistency, and quality.  This is the opposite of “penny wise and pound foolish”.   We help condo association boards keep their focus on the big picture.  This is CondoManagement360™.

At Enlan, we refer to our role as stewards.  This means that since we are entrusted with the property and goodwill of the condo associations we manage, our job is to manage in the way we would want it managed if the property belonged to us.  We believe that this distinguishes us in the industry.

Stewardship does not mean that our company makes policy, or major capital spending decisions without a resolution from the board.  Stewardship is based on long-term accountability.  Like other companies, Enlan typically provides monthly reports for the association.  But stewardship requires long term performance, with results measured over years — not just months.  We seek to provide value for today and tomorrow.

With our stewardship approach we deliver better quality and better value for homeowners, with fewer headaches for board members.  And when the board entrusts the day to day management to us, the board has more time to focus on the strategic policies, priorities, and direction for the association.

Professional Management

Before a condominium association board entrusts us with the stewardship of the day-to-day management of an association with property values well into the millions of dollars, we want the board to know that their decision is based on is well-placed trust.  The trust is based on our reputation, knowledge and application of traditional management disciplines (planning, organizing, staffing, directing & controlling), and technical knowledge of and experience with the building trades / project management / facility management / grounds management / and contracting.  Good management is both effective and efficient.  Thus we deliver both quality and value.

Value Alignment

With the principles of stewardship, we believe that we are better aligned with the values of the association.  We focus on 360 degree value, and our systems and training reflect this.

Enlan Corporation offers a full range of services:

Condo Management Services

Administrative

Compliance Management

Strategic Planning

Financial

Resident Services

Facility Management

Grounds Management

Project Management

Personnel Hiring and Supervision

Consulting

Providing property management services for condominium and townhome associations in and near downtown Chicago, including:

  • North Loop — Near North
  • South Loop — Near South
  • West Loop  — Near West