For the most part, people are afraid of change, and that’s why they are more likely to stick with what they have and what they know, rather than explore new possibilities.

That’s definitely the case with condo communities in relation to their management companies. Most of the time, an association’s board of trustees will enjoy a long partnership with their management firm and individual property manager, never even thinking about making a move. However, things do come up to warrant change.

“Typically there are a couple main reasons why an association may consider changing management companies but the primary one is lack of communication by the existing management company and the building,” says Steve Lewis, owner of Harvest Properties in Melrose, Massachusetts. “Communication can be just as simple as not responding to emails or phone calls in a timely fashion. That’s where the frustration starts and can build over a number or months or years depending on how long the relationship has been. If things aren’t communicated effectively then people can get very frustrated. Another reason is financial transparency, poor financial recordkeeping. If the association is not comfortable with the bills that are being paid or how much money is in the account, especially if they are not seeing copies of invoices that could lead to suspicion and distrust.”

Partiality to a board or association member, the commingling of funds, not enough face time or on-site exposure are also reasons a board might consider changing management companies, adds Ronald A. Grandchamp, CMCA, AMS, of Premier Property Management in Middletown, Rhode Island.

If problem after problem arises and the condo development is no longer running smoothly, it might be time to consider making a change.

A board may request changing to a new manager as a first step before changing firms. There are many potential reasons for this—ranging from something as simple as a particular personality that doesn’t mesh well with the board—to slow response time on issues, or even a lack of knowledge.

“A building may ask to switch agents but stick with the same management company, it happens but it’s not necessarily a frequent happening,” says David Abel, a senior property manager with First Realty Management in Boston. “It could be a personality conflict. If a building is having issues with a particular manager we will sit down and talk to him. We actually appreciate the fact that the board would give us the opportunity to talk to the agent instead of just making a change without having that conversation.”

Switching Managers

If a switch is warranted, it might be a good thing to keep things running smoothly.

When a switch is made, any good property manager should be able to get up to speed quickly and without a board’s help. Putting basic information down on paper, and performing a walkthrough of the property should be enough.

“A new agent should get a cook’s tour of the property with a board member and get as much information from them as possible,” says Grandchamp. “You should also find out about any projects that are underway or are on the list to be done. On that walkthrough you should be able to get a feel of board expectations and get a grasp on the overall association. You should also find out if they have had a reserve study.”

Switching Firms

According to management experts, a board should look at several options prior to a vote on which firm to choose. They need to keep in mind why they are making the change in the first place in very specific terms and look to ensure those things are addressed upfront with the new potential firm.

“Board members should look for a management company that’s affiliated with CAI (Community Associations Institute),” says Lewis. “CAI is a great resource for boards looking to switch management companies. They could simply contact CAI and ask them for their standard RFP (request for proposal) form, which they will give them for free. Then the boards should send an RFP to three to five companies. Those three to five bids will insure that the bidding won’t be all over the place.”

A board should also ask for a list of buildings a potential management company has lost in the last 12 months and the reasons why, even perhaps trying to speak to buildings that have recently left that firm.

Abel advises that a board should exercise all other options before making a switch. However, if the decision is to make a change, boards should not forget to ask for references.

“Boards should also ask around to similarly-sized associations to find out what their experiences have been,” says Abel. “Find out what resources they have in-house. Also take into account geographic proximity. Boards should educate themselves as much as possible.”

Typically the board will do their research and select their new management firm prior to providing notice to the original firm. Before making any change, they must review their existing contract.

When making a change in firms, there is normally a transition period that starts 30-45 days before the new company actually takes over an account with the transition probably lasting another 60 days into the official start of the relationship.

“It’s important for the new management company to get all the vendor contact information at least two months in advance,” says Abel. “That’s important because we’ll actually call up every vendor from the plumber to the electrician to the elevator guy and debrief them. We’ll call them up and say ‘hey we’re taking over on January 1st here’s our contact information.’ Information is vital. You have to know how the property runs and the ins and outs before you get there because the day we get there it’s too late. I have had professional courtesy extended to us and I have done the same where the manager will actually meet with us and tour the property with us. Some management companies refuse to do that. I’ve handed over property and I’ve had property handed over to me. You treat people with respect.”

From One to Another

Most management companies have specific people that handle all transitions from one firm to the next and it is usually a pretty smooth process. The new manager should first request a mechanical tour of the property with the outgoing manager.

Records and contracts need to be turned over, vendors and suppliers need to be notified and the residents in the building community must be informed.

“As part of the transition, and this should be included in the contract, the process is we’ll physically go to the previous management office and pick up any files, with electronic files on a thumb drive,” says Lewis. “Any files related to the property, insurance policies, tax returns, invoices, plans for the building, condominium documents, basically anything involved in managing the property. We don’t ever get personal information like social security numbers or bank information from the previous management company.”

When the new firm takes over, notice is sent by the new management firm to all existing vendors of the association.

The Right Reasons

As the saying goes, “If it ain’t broke, don’t fix it,” and that might apply to the situation as well. Sure, you want the best deal and best service possible for your building, but if you are already happy with what you have and are just making a move because of promises another company made, you could find out that they are not everything you thought.

Industry experts agree that a board should exhaust all options with existing management before making a change.

Unit owners don’t make the decision to change, but if a majority of residents feel a change is necessary and have good reason for the request, the board should listen and either work to correct the situation or vote to make a change.

“The hiring and firing of a management company is a board responsibility,” says Lewis. “There could be condominium documents written otherwise but generally it is a board responsibility and they do not need to seek owner approval. Sometimes the board will reach out to owners or a committee they’ve put together and help with the management search to get some input but that’s certainly not required.”

No one likes change. And sometimes the unit owners don’t have the whole story or the history behind the relationship.

“There is some local knowledge that is lost in every transition,” says Lewis. “If there is a management company that’s been there since the building was developed or for ten or fifteen years, there are certain things that just aren’t written down. So it’s important to have a checklist of what information and documentation that needs to be transferred from the previous property management company to the new management company.”

Keith Loria is a freelance writer and a frequent contributor to New England Condominium and other publications. Staff Writer Christy Smith-Sloman contributed to this article.