Why multi million dollars’ condos are perfectly maintained collecting just $0.23 – $0.37 per sq. ft./month condo fee but an economy class building is completely destroyed collecting $0.86 per sq. ft. /month condo fee, and having over $9 mln in debts and needing $14 mln for emergency repairs?
And what to do if you feel you do not get condo services you pay for?
Some residents believed that it had to do with luck or karma, while others thought that it must be something else entirely – like the quality of the construction or materials used in each building. But no one could say for sure what caused such a drastic difference in how people felt about their condos.
CondoBI team made a lot of researches to understand reasons of a big discrepancy in how much each condominium spent on common expenses.We collected a lot of examples of efficient and not efficient condo management cases and we want to publish some cases and show condo owners and directors that after a basic level of a condo fee that allows to provide a basic, mandatory maintenance, mandatory repairs and replacements, safety and a basic comfort, It does not really matter how much condo fees condominium collected, but it DOES matter how efficiently the money spent!
Let’s compare the buildings’ quality of maintenance and market values that have condo fees $0.23 and $0.37 per sq. ft. /month, and $0.86 per sq. ft. /month.
Why there is such different financial situation?
1. Toronto
This is one of examples that proved it is possible to collect just $0.23 per SF / month to maintain a luxury incredible condo building, with private and semi-private elevators . The most expensive lofts in the city, 6 Floors, 11 Units building:
Almost 5000 SF of custom designed space featuring the best of everything. Individual elevators into the loft foyer, enormous rooms, fireplaces, custom bars, libraries, tremendous entertaining spaces. Huge bedrooms w/2 walk in closets and spa like ensuite.
Condo fees – just $1631 per month for 4750 SF, it is $0.23 psf/month including 1 parkings spot. So, 6 – floor 100+ years building which is registered as a condo in 1998 year.
Lofts with 3+1 sizeable bedrooms with 3 ensuites, and underground parking space
This State of Art is worth to be shown to the wide public to understand and enjoy watching the quality of building and the life style!
Such condos prices are in a range of $3,800,000 – $8,800,000 for ~ 5000 SF
Based on the information of condos.ca, Condo has:
- security system,
- BBQ,
- visitor parking,
- gym,
- elevators,
- security guards,
- parking,
- hydro and water are included.
Taking into account that according to statistics of 2018, average condo fees in Toronto were ~ 3 times higher than in Montreal we were searching best practice examples in Montreal and we have found a lot of great examples.
2. Montreal
This is one of examples that proved it is possible to collect just $0.37 per SF / month to maintain a luxury condo building in a cold and snow winter:
Luxury Incredible Condominium with spectacular unobstructed views of the river. The property boasts grand proportions, high quality finishings, an inviting open plan, large fenestration3 sizeable bedrooms with ensuites (3+1), 2 private balconies, 3 parking spaces.
Condo fees – just $1037 per month for 2635 SF, it is $0.39 psf/month including 3 parkings spots. So, taking into account one parking spot fee is at least $20/month, net condo fees counted ~ $0.37 per SF/month. 23 – floor building is registered in 2005 year.
Condo has:
- outdoor and
- indoor heated pools,
- jacuzzi,
- 24/7 security,
- games room,
- party room,
- guests’ lounge,
- gym,
- golf imitator,
- water included.
Those are just 2 bright examples that prove it is possible to maintain luxurious condo buildings with just $0.23 – $0.37 psf/month condo fees!
3. Toronto
This is one example that proved it is possible to collect $0.86 per SF / month, have over $9 mln in debts for repairs but repairs are not done and the building needs $14 mln for emergency repairs the next year.
Why condo management was not able to provide a basic maintenance?
Do you think the major problem of that condominium was a low condo fee,
as some of the medias are trying to convince us?
Did condo owners need to pay more to prevent those problems?
They paid more and more. The condo fee has been increased by 200 % during last 30 years. It is approximately 6.6 % annual increase. It is rare when condominium collected a condo fee which is higher than average in Toronto >A but the basic level of maintenance is not provided.
How much would be enough for such building to provide a basic level of maintenance?
Major factors of condominiums’ financial failure might be:
- a conflict of interest (condo management and owners) that might causes a low or absence of motivation to spend condo owners’ money more efficiently,
- a lack of professional knowledge and skills (financial, engineering and general management) of a condo management team,
- a low interest of condo board to pay a proper attention to the list of repairs, and major replacements and to control the quality and quantity what actually has been repaired and replaced.
- a low opportunity for condo owners to influence condo management (owners are getting together once a year at AGM, they express unhappiness, makie noice with no result). Now, it is possible to discuss all the problems and worries inside of the building through condo-social.ca and ask an advice from owners of another condo building.
- low transparency (quotes from affiliated companies)
Why condo owners was not active? Probably they did not know what to do.
Dear Condo Owners, do not wait until the situation in your condominium became a disaster, as in 4645 Jane street condos.
It is your property, it is your life and it is your choice
to have a PEACE OF MIND or expect a NIGHTMARE
“Condo Business Intelligence” is collected a lot of examples and continuously looking for the best practice in condo management to help condo directors and owners understanding how efficient condo management might be and opportunities to invite property management companies (and even request a particular property manager) that proved their efficiency and could implement their the best practices in your condo buildings.