Every property management company has strengths and weaknesses. Some have a national presence but little understanding of local challenges. Some offer more boutique-style service but simply don’t have the resources and manpower to provide consistently high service levels and tools your community requires, resulting in burnout and high manager turnover. And some are the perfect blend of wide-reaching capabilities and attentive customer service.
But how can you know that you’re making a move to something better and not simply trading your current problems for a whole new set of difficulties? This guide offers a practical, step-by-step process to help you gather all the appropriate information in order to confidently make the right decision.
First, identify the specific reasons you are seeking a new management company
Before you begin, clearly outline the challenges you have with your current property management company. Are you looking for lower dues? Is there a lack of communication? Do you feel like you are doing the managers job for them or need more proactive project management? Be very specific because these issues will inform the questions you ask.
Next, write down what your current management company does well and where they are not delivering.
Take it a step further by articulating the effect their lackluster performance has on your community or commercial development. An understanding of the outcomes of poor management performance will help your new management company provide innovative solutions to your challenges.
Distribute a single scope of work to all candidates
Create a scope of work (SOW) that details the responsibilities and duties you want your management company to perform. Many management companies use different language for the same services so creating your own SOW ensures that all management companies provide a proposal that covers all the services you require.
If there are discrepancies between your language and the management company’s terminology, your SOW will open a dialogue with the management company to ensure that all parties are on the same page before a proposal is submitted.
Determine if a management candidate would make a good long-term partner
When you enter into a contract with a management company, you are ideally establishing a long-term partnership. Just as you would research candidates for any other job, ask pointed questions to understand more about the management company before determining if they are a good fit.
Here are some key questions to ask:
- How long has the company been in business?
- How big is the company?
- What is their management philosophy?
- How many managers are on staff? How many accounts does each manager handle?
- What types of internal tracking mechanisms do they have in place?
- What is their billing structure? (Flat monthly rate or monthly rate + ancillary fees?)
- Do they specialize in residential or commercial property management?
- Can they demonstrate their capabilities live, including their online services and a walk-through of key processes?
Probe further to get a clearer picture
Once you have narrowed down your top two or three candidates, remember that you are entrusting a very valuable asset to your property management company: your community or commercial development.
Pay attention to how they treat you in all communications throughout the bidding process: do they call back promptly? Have they read your emails? Are they friendly and patient? Ask the company what types of communities or commercial developments they WOULDNT be a good fit for. Look to see if they understand their own limitations, rather than answering with a blanket “yes-we-can” to every question.
Contact their references and ask pointed questions about what their experience has been like working with the management company candidate. Don’t hesitate to ask about particularly challenging situations in order to gain perspective of how a management company responds when faced with complications.
Selecting the right residential or commercial property management company can be one of the toughest challenges facing an HOA or commercial property owner. By taking the time to carefully vet your candidates before making a commitment, you will have the best shot at partnering with a company for the long haul.