Changing management companies at turnover

What are your thoughts, pro and con, about changing management companies when the association is turned over to the owners?

If you feel the companies should be changed, when should this occur?

It would depend on whether or not you are satisfied with their service and whether or not the BOD feels that the MC can adequately and fairly represent the homeowner's interests during the transition. From the records I've read, our community kept the Declarant's MC for five years after transition. However a new Ohio law to prevent Declarants from entangling condominium communities in long term contracts now requires a homeowner vote on the matter.

5311.025
(D) Unless a contract or other agreement is renewed by a vote of the unit owners exercising a majority of the voting power of the unit owners association, neither the unit owners association nor the unit owners shall be subject to either of the following:

(1) For more than ninety days subsequent to the date that the unit owners other than the developer assume control of the unit owners association, any management contract executed prior to that assumption of control;

(2) For more than one year subsequent to an assumption of control, any other contract executed prior to that assumption of control, except for contracts for necessary utility services.

This is something I did not consider when our association had a complete new board take over. We originally opted to do nothing and see if we could get things to work because we all had no experience managing an association. In hindsight, here is what we should have done:
1) Find out when the contract with the management company ends
2) Sit down with the property manager and owner to discuss your expectations

It will probably take at least 4-6 months for you to become fully aware if the management company is doing what they are suppose to; however, in the meantime it does not hurt to interview other companies. Do not let your management company roll the contract over for another year if you are still testing the waters.

Here is a link to an article that might be helpful to this thread:
"Evaluating your association's professional management needs"

http://www.flcaj.com/pdfdocs/managementmatters8.081.pdf

Assuming you are speaking of when your community is developed enough to change from PM company running the community to Board Members.

I would strongly suggest this due strictly based on experience. It took us years to find that the PM company that was set up for us by our developers, were strongly tied in hands with the developer. Shared Attorneys and interests in one another and not our community.

I would ask your current PM critical questions pertaining to the relationship they have with the developer.

Switching is hard, it takes months to establish the new relationship where everyone is working in sync. It can be done, we did it, but only after we found out how connected our developer and PM company were.

First, unless you have a copy of the management contract, it would be hard to evaluate performance. Developers often contract for the minimum service in order to keep assessments down. Talk to some of the owner-controlled associations that the company manages. If they are satisfied, then do as others have recommended, sit down with the company and interview them as you would any other company, possibly giving them a short-term, easy-out contract to get you through the transition and see how they perform.

I know a number of management companies that pride themselves in the fact that they've maintained a number of contracts from developer through transition and are celebrating 2 digit anniversaries with the client. In other words, it shouldn't be automatic to throw the baby out with the bath water. Take your time and do your due diligence.

Joe