November 2021
A condominium board is dissatisfied with their management company or manager. Addressing concerns in a professional manner can be more effective than replacing them.
Managing a condominium community is complicated. There are times when things don’t work out so well. The management company or manager may not be a good fit for the corporation. The board may have given too much responsibility or authority to the manager and failed to notice small problems until things go badly.
The board employs a management company and condominium manager to take on much of the burden of running the corporation. This allows the board to focus on other matters secure in the knowledge that resident and building concerns will be properly handled.
When first hired, the board will have hopefully made expectations of the management company and condominium manager clear in a signed contract. Now that problems have arisen it should be clear where the problem lies.
Among responsibilities of the condo board should be remaining in regular and direct contact with the manager, regular performance evaluations and a propensity to address things that have not been done as expected. Failure in any of this leads to a deteriorating relationship and damage that may be difficult to reverse.
Condo boards should recognize when it’s time to make changes to improve a difficult situation.
Poor communication is a common reason for boards to replace management. The board may have felt it necessary to take on tasks that may include resident communication, financial management and financial reporting. They may have felt the need to take over parts of day-to-day operations or became dissatisfied with vendors, contractors or contracts. A new director may precipitate change in management by identifying concerns ignored by prior directors.
When dissatisfied with management the first step a board should take is a non-confrontational conversation with the manager in the form of a performance evaluation. Focus on areas of dissatisfaction and expectations, and allow the manager to respond. It may be that the manager has been focused on pressures of daily operations, putting out fires and dealing with resident matters. They may be working hard but neglecting to establish priorities and address planning requirements. Alternatively, the board may be at fault. Their frustration could be the result of expecting management to do more than is possible or the addition of responsibilities without consideration of implications.
If issues remain unresolved have a conversation with the management company. The board can request a different manager be assigned to their property.
Giving management an opportunity to rectify concerns is often the best approach. A manager and company are likely to work hard at addressing concerns rather than lose your account. Should the company fail to be responsive the board retains authority to replace them with proper notice.
When the board feels the best recourse is to make a change this should be done on good terms and as seamless as possible. Treating the manager with respect makes them more likely to ensure a smooth transition. The current manager retains a history of the building that may not have been documented and needs to be communicated to a new management team. An effective way to facilitate this knowledge transfer is to employ both outgoing and incoming managers for a period of time.
An outgoing management company should turn over all hard copy and electronic files for the corporation along with any keys in their possession. More time sensitive information to be turned over immediately includes financials, bank account information and payment schedules. Everything turned over should be itemized.
Changing management is disruptive and time consuming. It should be considered only when other attempts at resolution have proven ineffective. Allowing all parties to work as a team to address areas of dissatisfaction can be more effective than wholesale management changes.
