Best Practice: Engage Unbiased Construction Advisors
by John Tight, CEO at Campbell Property Management
When major repair and replacement projects are being considered in a condominium or homeowner association, a lot of questions are raised that may be difficult to answer:
- What is the root cause of the problem?
- Do we have warranty or insurance coverage that might apply?
- Are there regulations that we need to comply with?
- Should we pursue a short-term solution or a long-term solution?
- Have any innovative solutions emerged that we should consider?
- Do we need an engineer’s or architect’s input?
- Who are some reliable, qualified vendors that can do this work?
- How should we structure progress payments?
- Are the contractors performing the work to the specification?
Unless you are lucky enough to have an in-house expert that is up to date with the area in question, you might need some help in figuring out the best path forward. Even if your property manager has some experience in the problem area, he/she should not be considered an expert beyond the actual job for which they were hired: property management.
The cost and risk of these projects can be significant. If not properly diagnosed, defined, sourced and managed, the Association could suffer from any of the following:
- Budget over-runs
- Extended closure of common areas
- Ineffective repairs that result in additional work and/or wasted funds
- Unplanned special assessments.
The key problem is – who to trust? The recommendations of a vendor, an engineer or even a contractor from your property management company may not align with the needs of your community. Is the person advising you motivated to:
- Sell you a service and generate revenue or,.
- Solve your problem in a way that fits with the needs of your community?
The following are three examples of situations where an unnecessary or ineffective solution was avoided with the help of an unbiased construction advisor:
Do we need to upgrade our elevators?
A hi-rise beachfront condo was having problems with the operation of their elevators on windy days. How do we fix this? An elevator maintenance company suggested expensive upgrades that would fix the problem. A construction advisor suggested a much simpler solution. He suspected that the wind entering the shaft on the roof and the parking deck was creating excess pressure that restricted the doors from closing. He tested his theory with the help of the maintenance staff by temporarily placing plywood barriers to block the wind, which immediately solved the problem. It turned out the best solution was wind barriers, not an expensive elevator upgrade.
Do we really need a new roof now?
A hi-rise condo had been experiencing intermittent roof leaks for over three years. Every time one was fixed, another emerged.
Ultimately, the general contractor from their property management company explained that the roof had reached the end of its life. A new roof costing about $80,000 was recommended. A new property management company was later hired and a construction advisor was consulted to advise the board regarding the roof replacement. After a brief inspection of the roof and some basic leak testing, the construction advisor isolated the issues and supervised a contractor who repaired the roof, resulting in a project cost of under $3,000. The condo board did not need a new roof or an $80,000 special assessment.
Do we need to fix our handrails to be ADA compliant?
A beachfront condominium needed to plan and budget for a project to update their handrails. Florida statues (FS 718.1085) require that handrails in common areas stairwells in high-rise buildings (75 feet or greater) must be compliant with the Americans with Disabilities Act (ADA), Fire Code (NFPA) and Florida Building Code (FBC) Standards before the end of 2014. A construction advisor was called in to define the detailed requirements for the board and determine the specifications required for a solution. After determining that a retrofit was not economically feasible and that a full replacement would be required, the advisor defined the specifications that were required for the job, identified possible suppliers and participated in the review of proposals. Despite clear specifications, the proposals included very different solutions that varied greatly in cost. The advisor worked with each vendor to refine their proposals so that they could be easily compared and evaluated. Without the help of the construction advisor, the board faced the risk of implementing a solution that was potentially not compliant, ineffective, or excessive in cost.
Consulting a vendor can be risky and confusing because they are more motivated to sell their product than solve your problem. Hiring an engineer may be a good solution, but be cautious of them recommending the highest cost / lowest risk solution to limit their liability.
The ideal advisor for construction and repair projects is:
- An experienced contractor with relevant, practical expertise
- Who is unbiased towards any particular solution
- Focused on satisfying the needs of the community
- Readily available and reasonably priced.
Your property management provider may have a general contractor on staff. On the surface, this sounds like an ideal situation. However, make sure you understand the goals and motivations of the contractor. Some property management companies have created Construction Management Divisions so that their property managers can steer work to its subsidiaries that generate revenues with high profit margins. Property management companies with construction and contracting divisions will try to sell the “single source” as a benefit, but history has proven this to be a serious conflict of interest.
The right construction advisor, whether it’s an engineer or a contractor, won’t have a financial interest in the solution chosen. At a minimum, he or she should follow these steps:
- Assess the problem
- Identify multiple solutions
- Evaluate the relative cost / benefit of each solution
- Educate and inform the board.
The ultimate decision is that of the board. It is the goal of the advisor to inform and educate the board so that they can make the best choice for the community.