Going Indie: Transitioning to Be an Independent Condo Board

 There’s a certain appeal to striking off and doing things on your own. The idea of being in control of your own destiny and not being beholden to anybody definitely brings with it a specific sort of satisfaction and empowerment. That, and a sense of sheer underlying terror that if anything goes wrong, you’ve only got yourself to fall back on. Kidding! We’re just kidding about the terror thing. Well, mostly, anyway.

The truth of the matter is that whenever you embark on any sort of independent journey, there is definitely both risk and reward involved. That goes for moving out on your own, starting your own business…or even transitioning your condo board to be an independent entity. There are plenty of positives that come along with running a self-managed board – but those positives don’t come without taking on a certain amount of risk at the same time. Keep informed and make smart decisions, though, and you should find yourself mostly safe from the perils and pitfalls some independent boards encounter – and if you’re here, reading this article, we have a feeling you’ll be just fine.

Get Your People On-point

Transitioning to an independently managed condo has the potential to save your board buckets of money. Just imagine everything you could do with that cash you’re paying a condo management company each and every month! Of course, that being said, you weren’t paying your condominium management company the medium-sized bucks for nothing. Once you go independent, it’s suddenly on you and your people to voluntarily handle the same things your condo management company was getting compensated to do, including (but certainly not limited to):

• Understanding condo tax laws and keeping your condo in good standing with the CRA;
• Maintaining an awareness of the Alberta Condo Property Act legislation as it stands and keeping up to date on any ongoing changes or developments to this set of guiding laws and principles; and
• Being intimately familiar with your board’s agreed-upon bylaws and working to uphold and enforce these standards.

As in-depth and complicated as those points might seem to be, they really do just represent the tip of the iceberg. If you’re suddenly feeling overwhelmed, don’t worry – even as you’re gearing up for independence, there are plenty of resources out there to help you make the leap. Just take a look at all the different educational events CCI North and CCI South host on a regular, ongoing basis, and sign up to do some learning.

It’s critically important before making the decision to disconnect from your condo management company that you have a firm grasp on all the work that this move will entail, and how everything will be handled going forward. People’s homes and lifelong investments are on the line, and it’s important that your board go into independence with its eyes wide open to the reality of things as a result.

Bring an Accountant onto the Board

This should be one of the very first things you do. No, seriously, even before you handle any of that other stuff that you couldn’t wait to go independent to dig into, get this locked down first. When you’re managing an independent condo corporation, you’re managing millions of dollars of property and investments. As such, it’s important that your board’s finances are handled expertly and appropriately, right from the start.

If you have an accountant living in your midst, ask, tell, harangue or cajole them into joining the board. If not, reach out to a non-resident accountant and have them sit in on board meetings to make sure things stay on the up-and-up. Finally, even with an accountant board member, be sure to have your condo corporation’s finances audited by a third-party yearlyso that you’re able to rest easy knowing things are well in-hand, and can catch any issues or problems before they snowball out of control.

Tying Up Loose Ends

Now that you’ve got a handle on what you’ll need to handle and have a first-rate accountant locked and loaded, all that’s left to do before transitioning to a self-managed condo arrangement is cleaning up a few odds and sods.

The first thing you’ll want to tackle quickly is a vendor list. Before making the jump to independence, you’ll want to have a solid list of vendors ready to go the moment you make the move. You don’t necessarily need to have any of these businesses or contractors on retainer just yet, but you’ll want them pre-vetted and standing by, ready to help you out when you need it. Consider connecting with a lawyer with condo-specific experience (e.g. a great condo law practice is through McLeod Law), that aforementioned accountant, and a maintenance/landscaping company to keep the property looking good. From there, build out your vendor list as necessary, being sure to thoroughly screen and vet each business or contractor before you bring them on.

Finally, if you’re saying goodbye to your condo management company, be sure to leave things on good terms. By giving some notice in advance and ending things on a positive note, most condo management companies will be happy to share vendor resources with you, help ensure your critical paperwork is in-line for the transition, and will generally help make the experience a smooth and seamless one. You’re starting out on your own as an independent condo corporation – so, set the tone properly and do it on the best foot possible.

Transitioning your condo building towards an independently managed entity is both exciting and nerve-wracking at the same time. New doors open up and exciting ideas suddenly become very real possibilities. At the same time, your condo board will be taking on an enormous amount of responsibility and work. Plan accordingly and make smart, informed decisions, and you should be just fine.

If you’ve got questions about how it’ll all shake out, or are just looking for a gut-check regarding whether or not your building’s ready to go independent, feel free to give us a call Condo Management Company. We’ll be happy to help vet your process and make sure that your building is set up for self-directed, independent success!