Strata Management – a New Beginning

With the events past now under the bridge, it is time to consider building a new perspective for the management of Huntly Wynd.

The question that comes to mind is this: Is there a better way to manage a strata corporation?

Just what are strata property management services*? Generally, a strata property manager provides assistance to a strata council (strata corporation) such as:

  • handling paperwork (record keeping)
  • overseeing a meeting
  • taking minutes
  • handling communications to and from owners
  • preparing budgets and financial statements
  • paying corporation bills
  • collecting strata fees or accounts receivables
  • entering into contracts and arranging services for the corporation such as insurance, landscaping, electrical services, maintenance, etc.
  • hiring and supervising employees hired by the strata corporation
  • providing emergency contacts and services

What the property manager CAN NOT do*:

  • be biased for or against an owner with respect to bylaws or rules contravention
  • determine if a person should be fined
  • determine the amount of the fine
  • determine if a person should be reprimanded for any reason, or
  • denied access to facilities
  • spend corporation money for general or specific expenses

(Note: *condensed from provisions of the BC Strata Property Act)

Next: How much are the services of a Strata Property Manager worth? According to statistics provided by the Real Estate Council of BC, property management services range from $25 to $40 per month per unit. In the case of HW, this means anywhere from $2,500 to $4,000 per month.

Are we getting our money’s worth having the services of a strata property manager? Do we have an alternative?

Let us answer the first question. Unfortunately, there are no existing measurements for evaluating the competency of strata property managers.

Our only recourse therefore is to use a rule of thumb: Has the management of the strata corporation (HW) been relatively and reasonably been below, at, or above expectations? If we are spending $30,000-$48,000 annually for all the services enumerated above, is it worth it?

And now for the 2nd question: Do we have an alternative? Of course, we do!

Routine monthly tasks include accounting, record keeping, processing receipts and disbursements as well as handling communications to and from owners. With an automated system, data processing, and online services, these tasks could be handled in a cinch – by a single person – part time. No rocket scientist required here.

In addition, we have in our midst, many owners whose professional expertise combine exceed all the skills necessary to oversee the operation and administration of a strata corporation. Does that give you some food for thought?

However, the idea of “self management” requires an entirely new paradigm. A new way of doing things. It means having a community that embraces the challenges and rewards of accomplishments. A community that excels in honest communication and mutual respect. A community that builds on the idea of neighbours helping neighbours. A community with a healthy social interaction.

Are all of these possible?

 

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What Now, My Love?

In this morning’s paper, Tony Gioventu, Executive Director for the Condominium Home Owners’ Association (CHOA), responded to a inquiry. Something he wrote struck a note. In 2016, CHOA did a survey of 16 buildings in Vancouver to identify impact on housing affordability, occupancy and rental bylaws. Here is a quote from his response:

“A 2017 update of the data has not indicated any substantial shift in the data, but there is one significant impact that several strata councils identified. By maintaining their rental bylaws, they have built communities with lower transiency in both tenancy and ownership and have been capable of maintaining the integrity of the nature of their communities.

Our community comprises of individual townhouses. It is not a multi-storey apartment building where “rental bylaws” impact residency, turnover, and speculative investing, (Rental restrictions have not been an issue with us.) But the highlighted statement above, interestingly, describes HW to a “t”: Since inception in 1978 (41 years ago) HW has successfully “maintained the integrity of the nature of our community“.

Nonetheless, the events at the last Special General meeting deserve some evaluation and of course, so goes the title: “What now, my love?”

Last February 22, I wrote about Embracing the Process of Change and what it takes to succeed with goals and objectives, quoting Harvard Business Review resources. The chart illustrating The Change Process is again shown below.

The short question to ask therefore is, “Where are we now?” What did we learn from what took place last August 30th? How far ahead are we today after so much hard work by several members of our community and members of our council during the last six months? Where does all this take us? Have we become victims of the “Ghosts of the past”?

Here is re-quoting Rosabeth Moss Kanter’s words from the article she wrote in the HBR:

  • “The ghosts of the past are always lying in wait to haunt us. As long as everything is steady state, they remain out of sight. But the minute you need cooperation for something new or different, the ghosts spring into action. Old wounds reopen, historic resentments are remembered — sometimes going back many generations. Leaders should consider gestures to heal the past before sailing into the future.

Socrates had this to say:

Examining what took place since the new council began their tenure and up to this minute, and looking at the “timeline” above (The Change Process chart), where are we today?

More importantly, considering the majority consensus we delivered at the SGM, are we much better off today than we were 5 years ago? 10? 20 years? 41 years ago? If this consensus takes us to an “old” status quo, what bright prospects are there to look forward to years from now?

The issue we voted upon on August 30th is not about changing carpets, replacing window coverings, modernizing furniture and fixtures, or solving the problem of moods and mildew at the pool, etc. It is about ASSET MANAGEMENT. It is about VALUE MAXIMIZATION and CONTINUOUS IMPROVEMENT. Asset management is about identifying the impact of the total life-cycle cost of an asset and about considering what is crucial to sustaining and improving its value. It is about provisioning for future contingencies that impacts its usage and longevity.

In the overall context, it is about maximizing the value of our community, now and into the future.

Over the last 6 years, we paid more than $6000 for engineers to assist us in ASSET MANAGEMENT Planning (by rendering Depreciation Reports). Their recommendations are supported by financial statistics. Although we may not take everything they suggest at face value, one item that can not be disputed is this: At their present state, the objects (clubhouse/guest house facilities) of the motions at the last SGM are in very poor state. They are 41 years old! They are not in keeping with the “integrity and (beautiful) nature of our community”.

I ask all 51 objectors this: If the facilities were your home, would you live in them at the state they are in? Would you be happy living there another 5, 10 years?

If you renovated and updated your home and it cost you $100,000 to do it 10 years ago, how much more would it cost you to do the same thing in 2017? 2027?

TENANCY and HOW it Impacts a community

We have a community of long-time dwellers and a very low rate of ownership turnover. However, our community cannot be sustained forever by an aging population. An unselfish community perspective must accept that like it or not, we will all be supplanted in the future by a new generation of owners. Actually, they are here now, trickling slowly to be among us. Who they are or will be will impact our enjoyment of our community for the rest of the years of our lives.

If we are selfish, cold, and unfriendly, so will they. “Birds of the same feather flock together.” Those who do not belong will eventually leave.

Our conduct and demeanour determine who and what kind of people we are. Unwittingly, we either become victims or beneficiaries of the way we handle our affairs and respect each other.

 

 

 

There’ll be some Changes Now

For there’s a change in the weather
There’s a change in the sea
So from now on there’ll be in change in me
My walk will be different, my talk and my name
Nothin’ about me is going to be the same
I’m goin’ to change my way of livin’
If that ain’t enough
Then I’ll change the way I strut my stuff
Nobody wants you when you’re old and gray
There’ll be some changes made

These are the lyrics of a song made famous by Tony Bennett and Billy Holiday.

Forty years! One of the new nominees elected to council last night asked: “Is there anyone here who has owned a property for forty (40) years and never spent a penny to upgrade or renovate their dwelling?”

“Nobody wants you when you’re old and gray”
“There’ll be some changes made” – that describes the reality about HW’s amenities. Yet, one person who had presented himself as “a realtor” cast a shadow of doubt about the findings of the committee which conducted an extensive research on adult communities. “At most, upgrading HW amenities could maybe raise the value of units by $400!”, he said.

Let’s have more fun! He raised hell because Guest Suite 2016 budget of $5,000 was raised to $8,000 for 2017 (actual income was $9,830). “What makes you think you can realize $3000 more (from this source of income)?”

Just for clarification as to what a “budget” is: “An estimate of income and expenditure for a set period of time”. Rosemary Peavler writes, “Without a budget, the business owner is literally shooting in the dark when it comes to trying to create an action plan for a company“. In a management and profitability planning sense, a budget is targeted goal to achieve. “Thoughts are things” according to Napoleon Hill. By developing a budget on the basis of which we plan to act, we are creating a momentum towards its achievement!

$8,000? $10,000? $20,000? There is absolutely nothing wrong about planning to “reach the moon”. If you fail, you fall amongst the stars! Patrick, you and your team did a great job!

Fortunately, at the AGM, there were many sensible questions and proper decorum was observed. Clearly, the President and her council members prepared well in presenting the results of their unselfish work for the benefit of the community.

With most of the proposed resolutions getting votes of approval from owners, a paradigm shift at HW is now evident.

Although there were valid and justifiable concerns about the merits of the proposed changes, supporting evidence pointed to positive outcome:

  • Upgrading of amenities would enhance community perception of HW
  • Increase enjoyment of facilities
  • Add aesthetics and longevity to infrastructures
  • Enhance ratio of cost of living space to average sales in line with other adult communities in Richmond
  • Address the  risk of AirBNB
  • Improve perimeter security measures
  • Eliminate insurance liability risks
  • etc.

The WILL of HW was expressed last night. It is a step in the right direction. With the council having announced (2) meetings to take place within a week of the AGM, we are all assured that it is determined to see goals set to be achieved.

Let us not watch the changes unfold. Let us participate in the excitement of great things to come. Let us do what Dr. Wayne W. Dyer advocates – let us all “think” these objectives to reality. Volunteering to help any which way we can is also highly desirable!

Council 2017 – “A well-oiled machine”?

Gotta give credit where it is due! He said that first! 🙂

This was written in a previous post: “We have a lot of talented residents here at HW, but I am not sure we have qualified professional geo-thermal engineers and geotechnical engineering experts with Building Science Specialist accreditations to assist in expertly evaluating our waterway system and other infrastructures to offer us guidance.” (Here is the link: https://huntleywynd.wordpress.com/2017/02/09/signs-of-good-things-to-come/)

It goes to show that there is a greater need for community get-togethers – to get to know each other better. The latest Council communique about the upcoming Strata Council Election announces a pretty impressive line up of new nominees for Council.

In addition, one of the nominees prove the quoted statement above wrong! We do have in our midst someone with the stated credentials (geological/geotechnical engineering).

In fact, with their professional and business accreditations, all the new nominees could very well be in the Huntly Wynd WHO’S WHO! For that matter, it would not be surprising if the 2017 AGM discussions were to proceed smoothly.

Here is extending a hearty congratulations to the nominees (and the continuing members of the council) for accepting the leadership challenge at HW. There certainly seem to be “many signs of good things to come”.

HW owners will be……..

Embracing the process of CHANGE

At the eve of the 2017 annual general meeting at HW, it is interesting to review the calendar year past.

  • A new council was formed and a new president presided
  • Bayside was replaced by Wynford
  • Coastal Pacific was replaced by Meridian
  • The new council sought assistance from volunteers to tackle major HW projects
  • Major motions are now tabled for consideration after many months of research and collaboration

(We have covered in previous posts some of the “exciting” events and there is no need to rehash.)

On March 1, 2017, will there be a “New Status Quo” at HW?

Let me quote from a Harvard Business Review article: “Leadership is about change, but what is a leader to do when faced with ubiquitous resistance? Resistance to change manifests itself in many ways, from foot-dragging and inertia to petty sabotage to outright rebellions.” (Does this ring a bell?) Continuing: “The best tool for leaders of change is to understand the predictable, universal sources of resistance in each situation and then strategize around them.”

The same HBR article written by Rosabeth Moss Kanter enumerates several (10) reasons why people resist change. Rather than identifying them, let me instead quote the essential attributes of leadership that help nullify resistance to change:

  • “Leaders can help people maintain dignity by celebrating those elements of the past that are worth honoring, and making it clear that the world has changed. That makes it easier to let go and move on.
  • “Leaders should over-invest in structural reassurance, providing abundant information, education, training, mentors, and support systems.
  • “Leaders should acknowledge the hard work of change by allowing some people to focus exclusively on it.
  • “Leaders should enlarge the circle of stakeholders. They must consider all affected parties, however distant, and work with them to minimize disruption.
  • “The ghosts of the past are always lying in wait to haunt us. As long as everything is steady state, they remain out of sight. But the minute you need cooperation for something new or different, the ghosts spring into action. Old wounds reopen, historic resentments are remembered — sometimes going back many generations. Leaders should consider gestures to heal the past before sailing into the future.
  • “Although leaders can’t always make people feel comfortable with change, they can minimize discomfort. Diagnosing the sources of resistance is the first step toward good solutions. And feedback from resistors can even be helpful in improving the process of gaining acceptance for change.”

GHOST OF THE PAST

I particularly appreciate what is written and how true it is: “…..the minute you need cooperation for something new or different, the ghosts spring into action“.

From an objective point of view, it is my opinion that many of the leadership attributes above have been exemplified by the tremendous efforts of the current council.

HW is a beautiful community; a rare jewel in the City of Richmond. The proposed changes are bound to elevate community perception, enjoyment, and value never before experienced. Let’s embrace change!

change

Signs of GOOD THINGS to come?

 

It appears that there are some “interesting” developments in the horizon. The current property manager at HW issued a notice for the annual general meeting for the community to be held (Monday) February 27, 2017 at 7:00 pm.

On the agenda, five (5) major motions will require consensus (majority vote). Of these motions, items 3, 4, and 5 would require capital expenditures. In essence, anything that has to do with infrastructures, regardless of sources of funding, always receives great amount of care, attention, and disagreement – before, during, and after deliberations.

Having been a critic of prior councils, I didn’t think I could be so complementary to the hard and complex work the present council has carried out to commence the process of positive change at HW. However, it is a “guarded optimism” as history will bare that major changes are not always embraced with open arms at HW.

Nonetheless, it would be a travesty not to recognize that “unpaid council volunteers” have done their best to come up with well researched and recommended changes.

ABOUT THE DEPRECIATION REPORT

We have a lot of talented residents here at HW, but I am not sure we have qualified professional geo-thermal engineers and geotechnical engineering experts with Building Science Specialist accreditations to assist in expertly evaluating our waterway system and other infrastructures to offer us guidance. Hence, the Depreciation Report.

By the way, let us not be overly confident and significantly solely reliant on the Normac Depreciation Report moving forward.

Let’s face it. Read the covering letter of the DR which I hereby quote verbatim:

“The purpose of the Report is to provide the Strata with a planning tool to help them make informed decisions about managing the renewal of common property assets and facilitate funding predictable capital replacement. The Report is not intended to accurately predict the failure of building systems.”

If this were an independent Auditing or Accounting Report, it would be of very little value since it is “qualified”.

While the authors of the report have accreditations as Certified Reserve Planners and Chartered Business Valuators, they admitted at their presentation that they prepared their evaluation based on “visual observation” of the assets. (Refer also to each one of the attachments in the DR under “VISUAL REVIEW”.)

Hence, they “cover their butts” so to speak by way of the “qualified” statement (above) and protect themselves through their company’s Errors and Omissions Insurance.

WHY IS THIS A CRITICAL CONSIDERATION?

What does this mean to the layman? In effect, they are saying (through the DR) that they have obediently “complied with (the minimum requirements) of Sec 94 of the Strata Property Act” (put into effect in 2010 in BC). There is nothing wrong with that!

The problem of course, is that when the council uses the “presented recommendations” of the DR as the sole basis for recommending changes (motions #3-#5), strata owners are presented with a limited perspective. Granted, there is a lot of merit in favor of a positive consensus for all of them.

However, if proper evaluation of the present state of HW infrastructures was prepared by highly qualified geothermal and geotechnical engineers, several things could change: life span of assets; date of replacement; estimated costs; and most importantly, CRF funding projections, and strata maintenance fees.

So what are we supposed to do now? In spite of the DR’s inadequacy in this regard, there are many good reasons to support the motions:

  • The contemplated upgrading of amenities can boost the value of HW and its units.
  • The life span of these assets is greatly improved
  • Enjoyment of the facilities by residents is greatly increased
  • Social interaction is enhanced
  • Proposed expenditure relating to ponds, streams, fences, is in line with proper maintenance and efficient management of assets
  • The current yearly allocation to CRF is $52,000; it means that in about 4 years the estimated funding (from CRF) of $200,000 is replenished, or exceeded (if a surplus from budget is recorded)
  • Due to the global uncertainty about trade (with the US President’s focus on realigning and renegotiating foreign trade agreements), maintenance or future capital expenditures could rise.
  • Therefore, it is prudent not to delay asset improvement projects

At the eve of the AGM 2017, there is a chance that in considering the proposed motions, some owners may be seeing an “old woman” in the picture above. Others could be looking at a gorgeous young lady. Yet it is the same image.

Others will look at the picture above and decide that A’s color is dark grey and B’s color is off white. (Look at it again and cover the line dividing the images horizontally to determine the actual colors.)

As you all prepare for a “wisdom sharing” exchange at the AGM, consider that while you could be looking at exactly the same picture, individual idiosyncrasies may sway you to see different “perspectives”.

It is time to set aside personal feelings and to embrace a “global perspective” of changes proposed with the objective of coming out of the AGM with a WIN/WIN perspective for HW and (hopefully) its glowing community.

Making our Community Vibrant

Carrie Randolph is an outstanding woman-a true philanthropist. You can read about her here.

She wrote about “What Makes a Vibrant Community” in May, 2011. In that article she describes “vibrant communities as places where:

  1. Arts and cultural expression are encouraged and celebrated
  2. Living & dying with dignity are community values
  3. Lifelong learning is encouraged and available
  4. Safety is both a community and a personal responsibility
  5. Civic engagement is considered a duty
  6. Sustainable economic growth is cultivated
  7. Protection of our environment and historical places is a shared value that benefits human health and our local economies

ARTS and CULTURAL EXPRESSION

The seven (7) attributes above could easily be applied to our community. When we got together for our 1st International Festival last September, we were celebrating our culture and diversity. We came together in a spirit of community and sharing. We brought food and great enthusiasm to share. We enjoyed music and entertainment and came home that night feeling wonderful.

LIVING and DYING in DIGNITY

When someone in our community is ill and in need, we stand by to help however we can. When someone leaves us for a care home, or forever, we grieve and send out our thoughts and prayers.

SAFETY

When something goes wrong that threatens our safety, we are concerned.

…But to make our community vibrant requires more from each of us. 

RECOGNITION of COMMUNITY SERVICE

First and foremost, it is my opinion that it is important to recognize that those volunteering to serve our community freely are giving of themselves for the benefit of the community. When we do, it changes interpersonal dynamics. We become more understanding of the challenges they face and the enormous responsibilities they carry. With that mindset, we become more generous, offering to help them instead of always keeping an eye on what goes wrong.

CIVIC ENGAGEMENT

We could choose not to do anything and let others carry on with what needs to be done in our community. But when we do, we abandon our right to experience community life. As Winston Churchill writes (above), “We make a life by what we give“! It is why “being involve” contributes to a vibrant community.

LIFELONG LEARNING

Imagine being able to share thoughts, ideas, and opinion. Imagine helping others solve problems. We could have community programs like  “yoga sessions”; morning “tai chi” exercises; community walks; seminars on “gardening”, internet surfing, fitness, landscaping; ballroom and line dancing; singing. Lifelong learning helps our minds and bodies stay strong and healthy. Imagine actively using our clubhouse facilities in a myriad of ways.

SUSTAINABLE GROWTH & PROTECTION of our ENVIRONMENT

Huntly Wynd is an incredible and unique place in the City of Richmond. The demand to maintain and enhance our infrastructures equates with the value of our homes and our community. When we care for our community the same way we care for our respective homes, we begin to have an open mind about the economic realities of the importance of assuring “sustainable growth”. We begin to see the significance of managing financial resources with the future in mind. We see our “monthly maintenance contributions” or “special levies” as our pledge to continue to build values to our homes.

SOWING SEEDS of DISCONTENT…

…negatively impacts community life. It hurts and fragments relationship. Please keep in mind that when we put our strata council or corporation in a legal bind for whatever reason, let us not forget that  it is us, owners, that are ultimately liable. Cost of legal proceedings or awards against the corporation ultimately depletes our resources.

Instead, let us strengthen and promote altruism and friendship. Our community deserves it. We deserve it. Perhaps one day, philanthropists in our community may consider a living legacy in their name for the benefit of the community they call home – Huntly Wynd.