The Key to a Thriving Condo Corporation: Consistency in Management

The success of a condo corporation over time is determined by four critical factors: the board, the management firm, the managing individual, and vendors/suppliers. While all are important, the managing individual is the most crucial of the first three. In this article, I will present my reasoning for this belief.

The Importance of the Board and the Managing Individual

Let’s first compare the board and the managing individual. There are four possible combinations of the importance of these two entities.

• Great board, great manager
• Not so great board, great manager
• Great board, not so great manager, and
• Not so great board, not so great manager.

Of the four combinations listed, the bottom two are clearly unfavorable for the corporation. A strong board alone is not enough to ensure the corporation’s success; it must also have an effective manager. While the ideal combination of a great board and great manager is rare, it does occur, leading to satisfied condo owners. However, this scenario is the exception rather than the norm. In either case, the importance of the manager remains clear.

The Significance of a Skilled Manager Amid Board Dynamics

Given the limitations of the bottom two combinations and the rarity of the ideal first combination, having a competent manager alongside a less-than-ideal board is the most optimal scenario of the last three. While a supportive board is crucial, turnover among directors is a common occurrence, which makes it particularly important for the manager to be skilled enough to effectively navigate the challenges posed by this constant change to the board dynamics. A strong manager is essential for the smooth functioning of the corporation, even in the presence of a less effective board.

Management Firm vs. Managing Individual: The Winning Edge

Let’s now put side-by-side the management firm and the managing individual. As in the first comparison, the only choices here are:

• Great management firm, great manager
• Not so great management firm, great manager
• Great management firm, not so great manager, and
• Not so great management firm, not so great manager.

Ignoring the suboptimal bottom two combinations, it is evident that having a skilled manager is critical for success, regardless of the capabilities of the management company. The scenario of a good manager and supportive management firm is ideal but rare, while a scenario of a competent manager and a less than ideal management firm is more realistic in real-life. At the very least, a good manager can compensate for some of the short comings of the management firm, but not so much vice-versa.

The Role of Suppliers and Contractors in the Corporation’s Success

What about suppliers and other contractors? Yes, they are valuable. After all, the manager will not be able to get the repairs done using in-house staff. Managers depend on good contractors for the various maintenance work completed and services provided to keep the property running and properly maintained. However, a great manager will navigate with ease around suboptimal contractors and ensure they deal only with the best ones. So even in this case – although with some exceptions – the corporation’s business partners will only be as good as the manager is.

Concluding Remarks: Consistency is Key

As we have seen, in the long run, a condominium corporation benefits firstly from a good manager, then a decent board, and finally a good management company and other tradespeople. Consistency is the key here. It has been my personal experience that whenever I have come across a condo corporation in a difficult financial situation and poorly maintained property, it has almost always been the case of a high turnover in the managing individual and the management company.

This should, of course, come as no surprise. A frequent change in the manager does nothing other than interrupting the flow of work and creates a lot of inefficiencies and delays in many maintenance and administrative-related operations, resulting in increased costs and resident dissatisfaction.  In my view, when it comes to a condo manager, the ‘buy and hold’ strategy seems to be the clear winner in the long run for a condo corporation, its owners, and residents alike.