Faced with a less-than-satisfactory management situation, a condominium or cooperative board may decide not to adapt, but to replace their property manager, or even switch firms completely. According to experts, this practice happens more often than one might suspect. Whether such change is for the better often depends on who you talk to, and even a mostly positive move can produce a certain level of stress and adjustment.
A board's decision to change property managers or firms will hit home—literally. If a board has done adequate research before switching management companies, the impact of the change should be positive, even if some adjustments are still required. On the other hand, if a board has done less than satisfactory due diligence, there will almost certainly be unnecessary (and unwelcome) upheaval, as well as possible financial ramifications.
Breaking Up is Hard to Do
Experts agree that changes in property management is a common occurrence for boards. “Boards seem to switch management companies almost like changing their underwear,” Jim Stoller, the president for The Building Group, Inc., a management firm in Chicago, says. “A new board comes in and they may not like the prior board and they want to change all of the consultants. Or someone gets elected to the board and they might have had a prior manager because they enforced association rules and they blame the management company. Residential management is different from other types of management—this is people’s homes. People are far more emotional about their managers and management companies,” he says.
Unfortunately, they don’t look at this as a clear business—they look at it as an emotional decision and sometimes that takes on a different level of scrutiny.”
According to Richard Holtzman, the president of Prairie Shores Property Management, LLC in Chicago, “Property managers have a shelf life of less than two years, so, there is frequent turnover.”