How do you know when your Manager is doing a Good Job (or isn't)?
Most of us have never been in the position of supervising a property manager before. We have probably lived in an apartment before, but if a faucet leaked there for 3 weeks, we couldn't do anything about it. Now we can.
Following is a list of standards that you can use to evaluate your management company. But don't leave your good judgement at home -- these standards are just a beginning. There are many reasons why a manager might not meet these standards, and they may not be the manager's fault. For example:
 | If the development doesn't have enough money for its operations, then some important tasks are not going to get done. The manager budgets money -- he or she doesn't print it. |
| If the development has fewer than 50 units, it may not be able to attract a top tier company. The "Mom and Pop" companies that manage smaller developments often do not have the capacity to get the job done the same way a larger company can. |
| If the development is located at an especially difficult area -- like a very rural site or one in a very dangerous neighborhood -- there will be additional costs that drain funds from the coffers. |
| Older developments and developments spread out over a very large space also generally cost more to manage. |
With that said -- here is what you need to start putting a report card together for your manager.
Respect |
The manager and staff should respect you and all residents at all times. The tradition of treating tenants like sub-humans was always degrading, and now you can do something about it. Without respect, the rest of this chart doesn't matter. With respect, you can overcome almost any problem. | ||||||||
Information |
Your manager should provide you with any information (except confidential personnel information) concerning your development. Without information, you cannot tell how your development and your manager are doing. There are more details on this below. | ||||||||
Financial Reports |
Your board should receive financial reports on the
development once a month, or once a quarter if you agree to that. You
should get them by the 20th of the following month, and they should
include:
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Work Order Log |
You should also receive a work order log on a regular basis, saying when work orders were called in and when the work was completed. | ||||||||
Budget |
Your manager should work with you on your budget starting around November 1 of the previous year. By December, you should have a complete budget of income and expenses for the coming year. | ||||||||
Occupancy |
Developments that are completely subsidized should have occupancy rates of at least 98%. Unsubsidized developments should stay about 95% occupied. This may be lower based on specific circumstances. | ||||||||
Collections |
Your manager should be collecting at least 95% of the rent that is due from residents, and 100% of the subsidies. | ||||||||
Unit Turnaround |
This is the amount of time needed to prepare a vacant unit for occupancy. Turnaround time can be as low as 3 days; more usually it is 2 to 3 weeks. More than 3 weeks means unnecessarily lost income. | ||||||||
Work Orders |
Emergency work orders should be done within 24 hours. Non-emergencies should be taken care of within 3 days most of the time, unless special parts have to be ordered. | ||||||||
Inspections and Surveys |
Each unit should be inspected at least once a year. Similarly, residents should be surveyed at least once a year to hear their level of satisfaction with the development's operations. The exterior should be inspected by the manager and a board representative at least once a quarter. | ||||||||
Reserves |
Your operating reserve should be 10 to 25% of your operating budget; on the low end if your development receives public subsidies. Your replacement reserve should be evaluated every 5 years, and should be at least 5% of the total replacement cost. | ||||||||
Payables |
Bills should be paid within 30 days of receipt, or 60 days at the most. Total payables should not exceed 10% of your annual budget. | ||||||||
Meeting Attendance |
Your manager should be available to attend Board meetings at least once a quarter and membership meetings at least once a year. Some buildings will expect much more frequent manager participation. |
This list is not comprehensive. There are some standards which are implied (no
building should be condemned; no note should be in default) and others which you
might want to negotiate based on your particular situation.
