Capital Reserve Studies
At W.J. Johnson & Associates we offer the following Capital Reserve Studies services:
- Fund status
- Funding plans
- Useful life
- Replacement costs
”0ur CPA commented that the W.J. Johnson & Associates Reserve Study was the most thorough of any she had ever seen"- Bob Oliveira, Executive Director - Wyndemere Homeowners Association.
"Forward thinking is what we have been taught by W. J. Johnson & Associates. Being proactive in having the funds to protect the value of our asset for the residents is crucial to the success of the property when it comes to resales" – Roberta McFarland, Property Manager - Sancerre
"You get the entire W. J. Johnson & Associates team including mechanical and structural engineers as well as landscape architects when you do a reserve study with them. Others say they walk the property; W. J. Johnson & Associates digs into the property over a period of days. When they are completed, you have confidence they know every aspect of the components of your community" –
Lisa A. Phillips, CAM, CMCA®, AMS, District Manager of Condominiums – Guest Services, Inc.
"Over the course of the last 5 years, The Club at Rapallo has worked very closely on several different projects with W. J. Johnson & Associates to include the Reserve Study requirements for our Master Association. Most notably for us, is the constant that when staff from W. J. Johnson & Associates indicated something was going to be done; it was done in a timely fashion, and always in a professional manner. Our experience with this Company has been positive and informative as they strive not only to do a good job, but to educate so that a full understanding of the various Reserve Study Components is easy for Board Members to understand and appreciate.” - Sherry A. Slater, LCAM, General Manager for The Club at Rapallo, Inc.
FIVE THINGS EVERYONE SHOULD KNOW ABOUT RESERVE STUDIES
Does your most current Reserve Study and your Reserve Analyst's team measure up to these standards?
1. A Reserve Study is a budgeting tool for the future repair, replacement and restoration of the common elements of a Common Interest Property.
2. A Reserve Study includes both a PhysicaI Analysis and a Financial Analysis.
3. A thorough Physical Analysis includes:
• A Component Inventory of all common elements having a predicable useful life of 30 years or less. The inventory is expressed in one of several unit quantity measures, such as, square feet, lineal feet, each, lump sum, etc.
• A Condition Assessment of each common element (i.e. Good, Fair, Poor) with an estimate of the Remaining Useful Life. As a bonus, the assessment would include a review of all maintenance procedures and contracts with observations of deficiencies and recommendations for improvement.
• Current Cost Estimates for the future repair, replacement and restoration of the common elements.
4. A thorough Financial Analysis includes:
• An assessment of the Reserve Fund Status expressed as % Fully Funded. The term Fully Funded is best defined as the depreciated (or used up) amount of the value of the common elements. In a perfect world, the Reserve Fund would always have an amount equal to the used up portion of its component assets.
• A Funding Plan prepared using either the Component (straight line) Method or the often preferred Pooled (cash flow) Method. As the name implies, the Pooled Method groups the entire common elements into a single fund and covers anticipated expenditures for repair, replacement and restoration over the longest Remaining Useful Life of any asset within the pool. The Pooled Method includes provisions for both inflation and earned interest. As a bonus, multiple Funding Plan alternatives would be offered for consideration.
5. A thorough Reserve Study, with bonuses, is a collaboration of the Reserve Analyst's team of civil, structural, mechanical, electrical, landscape and financial professionals with the Client's team of owners, property management and maintenance staff.
If your current Reserve Study and your Reserve Analyst's team do not measure up to these standards, contact us for a no cost consultation on how to make our team part of your team.
Contact us today for more information.