LOOK A LITTLE DEEPER!

By Darlys Walker

Published June 8, 2016

The Miami Herald should do a complete investigation story on all the ways that associations are being ripped off by their management companies. As most of you know, my firm manages throughout the southeast. In my professional opinion, Florida by far, has laws to protect the condominium owners and not so much for the homeowners. However, the one thing I see prevalent in EVERY association that we take from another management company, in Florida, is the amount of hidden fees and upcharges that the boards are either unaware of, think its normal practice or just don’t pay attention. Yes, there are companies, like us, who are ethical and don’t try to gouge their clients. But beware, as we are few and far between.

So what areas can you as board members pay close attention to, ensuring you’re not being misled or ripped off? Here are just a few:

  • Late fees payable to the management company as opposed to the association

  • Excess transfer fees and move in/move out fees payable to the management company.

  • Salaries added into the management fee as opposed to broken out as a reimbursable at actual cost. **THIS IS HUGE*** Standard practice- A management fee of $50,000 a year, plus a CAM at $85,000 per year, plus taxes and benefits for that CAM at $30,000 for a total monthly management fee of $165,000 annually. But, the management company finds a manager at $65,000 per year, which reduces taxes and benefits (at their rate, which will be discussed next) at $23,400 combined results in an annual savings of $26,600. Who do you think benefits from these savings? The management company! Why? Because they build in the cost of the staff they provide to the association, at a set rate, and rolled it into the management fee!

  • Let’s talk about taxes and benefits. So most Florida management firms add 32-36% to the total payroll, for taxes and benefits. However, this amount is inflated with most management companies. They are profiting anywhere from 5-10% off of the association. You may not think this is much but look at it this way. A community has a CAM at $75K, maintenance at$65K and housekeeper at $30K. The total annual payroll is $170K, taxes and benefits at 32%= $54,400 or taxes and benefits at 26%= $44,200. A savings of $10,200 annually. Here is a little more information, the average cost of healthcare to an employee receiving free medical/dental/eye is approximately $495 per employee, per month, with very low deductibles. 98% of the management companies have the employee share the cost usually $50-$75 per pay period. But the association is charged full price, again who pockets the difference?

  • Have you had this experience or do you have a good honest management company? I would love to hear your thoughts.


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    Darlys Walker, Founder and CEO of Condominium Concepts Management, Inc. (CCM), is recognized for her straight talk, subject matter expertise, and valued insights regarding real  

    state management, leasing, and HOAs. Her company serves a diverse portfolio of properties, from 16-units up to 600 as well as large mixed-use developments.  

     

       From its beginnings in 2000, CCM has become a well-respected asset manager and now works with over 100 associations with 16,000 units served by over 300 employees. Darlys and her team deliver resources and responsiveness through six regional offices - in Orlando, Miami, Jacksonville, Charleston, Nashville and Atlanta.

      

       Darlys Walker is best known for her passion and precision, understanding that the only difference that matters in today's demanding marketplace is service delivery ... doing what is promised and what is right. She knows that every community serves two masters ... the property owner/developer and the resident/homeowner. "If we are not equally responsive to both, we are not doing our job," she states.  

     

       Her clients say it best: "Darlys really knows her stuff" ... "at the top of her profession and it shows in the caliber of her clients" ... "delivers quality resources that match up well with needs and expectations that are really rigorous."  

     

       She is a licensed Real Estate Broker in four states, holds an Associate's Degree in Marketing and has earned the Accredited Real Estate Manager designation from the Georgia Institute of Real Estate Management. Also she is one of few certified as a Lead-Based Paint Abatement & Removal Trainer in Georgia.

      

       Darlys Walker and her team have been selected to manage the condominium conversion process and day-to-day operations for many of the Southeast's most high-profile condominium communities including luxury high-rises, mid-rises and garden-style homes. Most recently she has been recognized as an expert in 're-versions' of communities from condominiums to leased homes, as well as repositioning projects. A visionary and a tireless perfectionist, Darlys demonstrates hands-on leadership, working individually with each client and staff associate to achieve defined business outcomes and satisfaction.  

      

      For more information about Darlys Walker and Condominium Concepts Management, Inc. please visit www.condominiumconcepts.com.


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