CONSTRUCTION AND OPERATIONAL CONTRACTS IN CONDOMINIUMS. THE IMPORTANCE OF VETTING, INSURANCE AND CONTRACTUAL RISK TRANSFER

SPEAKERS:

ED ALLCOCK

ALLCOCK & MARCUS

ed@amcondolaw.com

NOUSHIG HAGOPIAN
First Service Residential
noushig.hagopian@fsresidential.com

KEVIN KEHOE

ASSURED PARTNERS

Kevin.Kehoe@assuredpartners.com

 

In the wake of the Champlain Towers in 2020, the condominium lending and insurance markets have become strictly more stringent.  Lenders and insurers are now digging into condominium financial and operational information prior to lending and/or binding policies.  At the same time, many condominium buildings are aging and in need of repair.  Insurers are concerned about increased liability, while condominiums are concerned about increased construction costs and skyrocketing premiums.

This webinar will address the above topics as well as strategies and programs that condominiums can implement to vet bidders and vendors, as well as discuss the importance of proper contracts and appropriate risk transfers between the parties.

The panel will provide their extensive experience from the management, insurance and legal side as to how to best protect your condominium association.

 

WEBVTT

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Minute or so.

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Alright. I think we can get started. We don’t wanna.

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Delay too much! So good morning, everyone. Welcome.

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On behalf of all Cock and Marcus and our fantastic panel this morning. Want to thank you all for taking the time to join us.

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For this important, exciting, educational webinar. You know how busy everyone is, especially this time of year. So we appreciate your attendance and participation this morning.

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Few housekeeping tips before we get started. We shouldn’t have any issues. But if anyone, if everyone can just make sure that they mute themselves. So as to not have any kind of distraction or interruption. For our panelists. That would be great.

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We will have a dedicated section at the end of the discussion. So if you have any questions, you can just write them in the chat or in the QA. Box? I will monitor them and make sure that they get answered. At the end of our discussion.

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This morning the webinar.

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It’s being recorded. It’ll be available afterwards.

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If you wanna play it back for anyone that wasn’t able to attend this morning. That will be available once we conclude this morning.

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And lastly, there is a little Easter egg hidden throughout our presentation this morning in the Powerpoint, so.

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Keep your eyes peeled for that.

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And as soon as somebody gets it, write it in the chat, and at the end we’ll announce if somebody got it correct and hopefully who that person is.

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And whoever can figure out will figure that out. We’ll get a couple of Celtics.

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For an upcoming game on behalf of courtesy of Alcock and Marcus. So that’s exciting. At the very least. Someone might be able to get that out of this webinar so definitely be on the lookout for any sort of hidden messages.

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So now that’s out of the way again. Welcome to this morning’s webinar construction and operational contracts in condominiums. The importance of vetting insurance and contractual risk transfer.

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We have 3 wonderful panelists this morning who each bring a unique and interesting perspective to this important conversation. We are joined by Ed. Alcock, managing partner of the law firm, Allcock and Marcus.

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We have Nushik Hugo, who is a senior Vice President at 1st service, residential.

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And last, but certainly not least, we have Kevin, who is a senior vice President of sales commercial lines at assurance.

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So with that I will turn the mic over to Ed.

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Good morning, everybody. Thanks for attending.

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A couple of additional housekeeping.

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I’ll also monitor the chat, and when appropriate.

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Feel free, you know. We’ll try to weave in.

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Some answers to questions as we go.

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Thank you.

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In terms of the the hidden Easter egg.

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What what I’d like to say on the.

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On the hidden Easter egg is.

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That

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It’s kind of a theme look to the Powerpoint.

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You will maybe see what the theme is.

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Through the Powerpoint. That’s that’s my last.

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That’s my last tip on that. So.

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Let’s start talking about

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Contracts and.

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When we’re talking about contracts.

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In the

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Condominium, world.

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As a lawyer.

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I often find myself saying.

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What not to do. Because a lot of these.

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Get to me. Unfortunately.

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At the stage where I have to litigate.

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Issues pertaining to the contract. So

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You know th this call this zoom.

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Is is about.

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Preventing.

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Litigation.

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Much to my judgment. It. It’s about closing gaps.

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And and figuring out how.

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To get from point A to Point B, not just on construction, and we know construction is a big thing in condominiums. Now.

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With associations.

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That that have been around for 2050 years.

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Undertaking significant.

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Repairs and remediation projects.

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But but I think this also comes up in the day to day operations. The kind of contracts we enter into with our.

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Snow, plow vendors, our landscape vendors, and so forth, so.

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What I want to start with.

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Is, you know, kind of. In the middle of the discussion.

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And and then we’re gonna go back to the beginning.

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So so what I say is what not to do. So what you see on.

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On your screen right now.

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Is one of those sample contracts.

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That.

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Sort of irks me. I’m assuming it irks Kevin and ‘s.

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Nushig

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You know th, this, this here appears to have been a 12 unit condo. This was a roofing project.

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You know, 6 figures, not small, 6 figures, mid 6 figures.

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The contract is 2 pages long.

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2 pages long and.

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You know it contains a schedule.

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Payment. Of course, that’s the number. One thing the contractor wants.

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It’s got some scope of work that there’s some weird drawings.

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On it. There’s some signatures.

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There’s a warranty.

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But not much else.

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And you know I I want to kind of go over.

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You know, like some of the things.

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That that 2 pager is missing.

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For example, it has no termination.

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Like, what what if? What if one party wants to terminate the contract.

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For some reason there’s.

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No insurance, provision.

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Nothing in there. And and that’s gonna be a big topic of what we talk about today.

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There’s nothing in there that says.

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The insurer is required to. I’m sorry the contractor is required to carry insurance.

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Does he have to carry insurance? What if he doesn’t have insurance.

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You you’re gonna hear from some of our panelists today saying.

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Not only do we wanna make sure he carries insurance. We wanna make sure he’s got the right kind of insurance. We wanna make sure he names.

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The Association as an additional insured.

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That 2 pager. Nothing doesn’t speak to what happens if one party breaches.

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What happens if the contractor doesn’t show up on the date and time he’s supposed to.

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Are you entitled to Fulton?

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Are you entitled to damages?

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What happens if he doesn’t perform in the middle of the contract?

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Are you entitled to terminate? Are you entitled to breach.

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Are you entitled to the images.

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How is.

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Progress for payment. If you go back and look at that contract.

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It says, upon signature 50. When work is completed.

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The other 50. Well.

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How do you determine when work is completed.

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Does the contract just say, Oh, work is completed.

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Is there? Is there a 3rd party that looks at it to say.

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Work is completed. What does that contract say about change orders.

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Nothing doesn’t say anything. Is, is there a change order, process?

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Or or is everybody stuck with.

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That price? And and how does that affect.

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Ultimately the product that you’re gonna get.

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So you know.

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Nobody said.

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Nobody said that. It’s easy.

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When you are in.

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A

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Contract with.

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You know, you know, and some of these contracts. Now I’m hearing about them.

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Talk to one property manager the other day.

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48 million dollars. Okay, that’s a lot of money.

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Even $600,000 is a lot of money.

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To have writing on a 2 page.

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Contract, you know. So.

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So what happens?

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You know, when the contract gets halfway into the job.

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As has happened a lot in the last 4 years, and says.

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Oh, you know, costs have gone up. There’s inflation.

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And the the contractor wants more money.

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Are you stuck.

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What if there’s a personal injury on.

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On the job site. Didn’t you have a situation on a job site?

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Where something happened.

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Yes, unforeseen issue with a crane that fell actually during a project.

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Thank God, everyone was okay. But and we had. Obviously we were very well prepared. Everything was insured in line.

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But you never know when things like this are going to happen, and and oftentimes it’s no one’s fault.

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Accidents happen, and I think the message here is to be as prepared as possible.

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Kevin. What if there’s a fire or property damage? Right? You say, okay, well, how is there going to be a fire?

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If if we’re bringing the plumber in to do some plumbing.

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Kevin did.

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It was. It wasn’t a fire, but the the plumber was using his torch to change out a hot water heater, and while using the torch, he set off the sprinkler system in the building.

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Causing 350,000 damage.

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The contractor was there.

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On a phone call. There was no opportunity to. The Association’s insurance was canceled. They find themselves in surplus lines, paying 3 to 400 more on annual premium.

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Because they did vet the contractor correctly.

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So. So the the one of the themes today, like I said.

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It’s not easy to go through all of this stuff.

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Beforehand but what you’re what you’re doing and what my job a lot of times is protecting you.

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From the parade of Horribles.

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That can happen. And the 2 page contract.

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Doesn’t do it, and the the consequences.

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Can be great. I mean, you’re spending all this money to get a contract done.

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Now, do you have to spend additional money? Do you have to put an insurance claim in.

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Are you now in surplus lines? Wait a minute.

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Doing this contract because you’re in such a hurry to get the work done, and you didn’t want to deal with the lawyers.

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You didn’t want to deal with. The pre contract vetting.

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It’s now cost. It’s now put you in a worse position.

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Than you were. To begin with.

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And and as as Nushik said, you know, some of the takeaways are.

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You you need to think.

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If you’re on a board, or if you’re property manager, that this is.

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Not just a home. It’s a multi 1 million dollar.

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Organization, the homes.

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The way to think about it is. And people think, Okay, my home’s worth $450,000.

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Well, there’s 200 of those homes.

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You. You’re talking about running an organization.

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With a value in the millions or the tens of millions, which means.

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When you’re on that board you can’t be thinking small. You can’t be thinking 4 50. You gotta be thinking 20 million.

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You need to think like a CEO, and and you need to. You need to use.

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Professionals,

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When we talk about contracts.

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One of the one of the easiest things to do.

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And I know Kevin has a funny story.

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Is, is, the contractor sends you over his form.

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And and.

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Yeah.

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Kevin tell the story about what happened when when you got the contract. This form.

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Yeah, a.

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Very large Metro West Association.

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With the units valued over a million dollars apiece.

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We’re hiring a.

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Well known local construction company.

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To change the roofs.

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And they submitted their contract to the association, who fortunately was smart enough to forward it right over to their attorney.

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The contract required the Association to name the contractor as additional insured on the associations policy.

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And to submit the liability policy. Confirming this setup for roofing operations.

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I mean that that violates the terms of the master policy in multiple ways.

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When I call, the contractor said, you know what.

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We can’t sign this.

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Because it’s a violation of the master policy.

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And the contract manager for this company said, Oh, that’s okay. I’ll send you the B version of our contract, which should be compliant.

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I’ll send you the other form.

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The other one.

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I’ll I’ll send you the form that you should be signing. But I’m gonna try to get you to sign the other form, so.

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What what always happens is, the contractor sends over their form.

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And and then you know it. It.

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My preference is is to start with the Aia form.

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Because it’s designed to be fair and balanced. The the terms have been.

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Negotiated and vetted by architects and.

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Industry people all over the country, and you can.

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You know. Sort of take out paragraphs, put in paragraphs, take out sections, put in sections.

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And everybody sort of knows.

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What they’re working with. I’m not saying you have to use that contract. That’s a good start.

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But as a general rule, try not to use.

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The contractors default.

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Especially if they already have.

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Sort of the B form, so.

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So with all of that in mind.

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Let’s.

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Go back to the start and.

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And let’s talk about.

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The sort of pre contract process.

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Why don’t you take us off on.

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Sort of how.

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How like like, what like, when you’re dealing with a with a.

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Construction, contract, or even.

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When you take over a new place and you’re in and you’re vetting new operational contracts. How do you guys start this.

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Yeah. So we always start with looking. What’s looking at what’s in place specifically, is it serving the community? Is it.

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You know, serving the contractor, and and just generally looking to make sure that we’re protecting.

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All of the interests of our communities. That’s that’s number one. And in terms of projects.

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And you know, that’s that’s sort of taking things up. Really.

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Another notch in terms of.

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You know the investment that the Association is going to make in these projects.

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And we really want to always try to educate our boards and our communities as to really what’s involved, because it’s a very serious and important process, and as our boards are doing their duty to protect and preserve the asset, this is a really big part of it, and this really encompasses everything from.

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You know, fixing your balconies to roof repairs and replacements and disaster recovery, you know, as Kevin mentioned sometimes, unfortunately, there’s.

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Big accidents that require, you know, repair electrical work, plumbing work.

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Even sustainability updates, such as you know, solar and charging stations.

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Parking lot and road paving. We’ve seen a lot of that, you know. Those are things that you know need to be done on a regular basis.

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And and other types of important work that’s being done in your community. You really want to start with.

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Identifying W. You know what the specific project is, and then consulting with subject matter experts such as engineers, architects, you know, whoever you need to help you.

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And the community make a good decision about how you would like to proceed with this process. For example, if you’re doing your roof, maybe there’s better materials that you know are available now to you that are going to last longer, that are going to add to the to the value of your asset.

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Determining the exact scope of the work.

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You know? What is it? Exactly.

00:20:15.000 –> 00:20:21.000
That we are doing, and with this specific project, and creating an estimated timeline.

00:20:21.000 –> 00:20:36.000
We also offer, you know. Obviously have your management company work with you on securing loans. And you know, if there’s going to be an assessment, making sure that that’s done in an orderly fashion, and and you know, very transparent with your community.

00:20:36.000 –> 00:20:44.000
And then preparing a really thorough, comprehensive Rfp. Which really states the exact.

00:20:44.000 –> 00:20:49.000
You know steps of this project. What it entails.

00:20:49.000 –> 00:21:05.000
Using your architect and engineer. You know their insight and input to exactly what this project is. And then I I agree with Ed the Aia form is a really great place to start. I think it’s very comprehensive. It’s customizable.

00:21:05.000 –> 00:21:16.000
And I think the other really good thing about it is, it’s pretty easy to understand. I think. You know it’s it’s not. It’s it’s thorough, but it’s fairly easy to understand and customize.

00:21:16.000 –> 00:21:30.000
So once you get to that point, you really want to. You know. Make sure your Rfp is is great, and then you’re going to share it, you know, with your, you know. Put out the Rfp. To your, you know. Vendors.

00:21:30.000 –> 00:21:34.000
And what we always recommend is.

00:21:34.000 –> 00:21:36.000
You know. Collect your bit sheets.

00:21:36.000 –> 00:21:47.000
Compile them, you know. Put them on a spreadsheet so your your boards can see them and and feel like they’re really able to compare, you know the various bids.

00:21:47.000 –> 00:21:59.000
And then you know, obviously, your vendors, hopefully that have are bidding are going to want to come and see the project hopefully they are. If they’re not, then, you know, that might be a little bit of a red flag.

00:21:59.000 –> 00:22:03.000
If your vendors doesn’t want to come out and actually see what they’re doing.

00:22:03.000 –> 00:22:22.000
And then, you know, present that you know to your boards, and then make a good decision about what you you know which direction. And obviously, you know, vetting your vendors is a very, very big part of you know this process.

00:22:22.000 –> 00:22:27.000
Let’s see. So, looking at this slide, maybe next slide.

00:22:27.000 –> 00:22:31.000
Sure.

00:22:31.000 –> 00:22:34.000
Talked a little bit about, you know.

00:22:34.000 –> 00:22:37.000
Preparing, picking the right vendor, and I think.

00:22:37.000 –> 00:22:41.000
We’ve talked a lot about that. That’s really important.

00:22:41.000 –> 00:22:51.000
You know, you wanna have the right partner with you to do this because there’s a lot there’s a lot going on. It’s a disruption to your community. It’s a big.

00:22:51.000 –> 00:22:53.000
Big

00:22:53.000 –> 00:22:56.000
Commitment, financially.

00:22:56.000 –> 00:22:58.000
You know, there’s people around. There’s there’s a lot of.

00:22:58.000 –> 00:23:01.000
You know, construction so.

00:23:01.000 –> 00:23:05.000
How do we vet bidders? And you know what’s what’s the process.

00:23:05.000 –> 00:23:11.000
For that, and a lot of companies right now, I know our organization is is.

00:23:11.000 –> 00:23:14.000
Depending on using 3rd party vendors.

00:23:14.000 –> 00:23:17.000
To help thoroughly vendor, you know.

00:23:17.000 –> 00:23:20.000
Thoroughly that vendors.

00:23:20.000 –> 00:23:23.000
And I’m sorry, Ed, I’m going a little back and forth. So yeah, okay.

00:23:23.000 –> 00:23:28.000
No, no, you’re fine, you’re fine. I got a request.

00:23:28.000 –> 00:23:31.000
To

00:23:31.000 –> 00:23:34.000
Put the slideshow on the full screen, and I’m not. I know how to do that.

00:23:34.000 –> 00:23:36.000
Okay.

00:23:36.000 –> 00:23:37.000
Please, do.

00:23:37.000 –> 00:23:39.000
I’ll keep going so.

00:23:39.000 –> 00:23:46.000
The reason why, you know, a lot of organizations are doing this. And it’s it’s not just management companies. It’s a lot of.

00:23:46.000 –> 00:23:52.000
You know, organizations, many disciplines that really want to make sure that.

00:23:52.000 –> 00:24:00.000
The the vendors and the business partners that they are using are completely vetted.

00:24:00.000 –> 00:24:09.000
And this this has a lot to do with, you know, insurance, obviously, which Kevin, you know, can comment a little bit on. Do they have the right coverage.

00:24:09.000 –> 00:24:20.000
Are the indemnifications correct? Do they have the right limits? Do they have everything that is required to make sure that when they work on your site, that your community is protected.

00:24:20.000 –> 00:24:27.000
Are there background checks being done? You know. Are there any outstanding judgments? Collections.

00:24:27.000 –> 00:24:30.000
Bankruptcies, foreclosures.

00:24:30.000 –> 00:24:32.000
Are they on the National Watch List.

00:24:32.000 –> 00:24:36.000
And here’s another big one which we found. Do they have the right license.

00:24:36.000 –> 00:24:39.000
You know, it’s hard to believe, but sometimes.

00:24:39.000 –> 00:24:43.000
You might have a vendor that that says they have a specific license.

00:24:43.000 –> 00:24:50.000
And, you know, come to find out. It may not be active, it may be expired, or they may not even have it.

00:24:50.000 –> 00:24:57.000
So always always put yourselves in a position to make sure that you are really vetting your.

00:24:57.000 –> 00:25:01.000
Your vendors. This is this could lead to.

00:25:01.000 –> 00:25:09.000
You know, unfortunate issues. If if they’re not properly vetted. So you know, we always say we won’t even present.

00:25:09.000 –> 00:25:11.000
Someone who we we know is not.

00:25:11.000 –> 00:25:15.000
Has not gone through our vendor credentialing.

00:25:15.000 –> 00:25:19.000
Process, because we don’t want our boards to consider them if they’re not.

00:25:19.000 –> 00:25:23.000
Willing, and want to do that actively for them as well.

00:25:23.000 –> 00:25:25.000
2 points on that. So.

00:25:25.000 –> 00:25:30.000
And I and I have to say I appreciate that approach.

00:25:30.000 –> 00:25:34.000
Because I wind up having to deal with a lot of the back end of this stuff.

00:25:34.000 –> 00:25:40.000
Where I wind up, having to sue.

00:25:40.000 –> 00:25:41.000
Hmm.

00:25:41.000 –> 00:25:43.000
A contractor, and usually it’s messy. It’s millions of dollars. And I have to say.

00:25:43.000 –> 00:25:48.000
How the hell did they pick this guy? Because he has no insurance? He has no assets.

00:25:48.000 –> 00:25:53.000
And as far as I can tell, he’s done everything.

00:25:53.000 –> 00:25:57.000
Improperly or incorrectly.

00:25:57.000 –> 00:26:02.000
And you know in turn, i i i am kind of curious because.

00:26:02.000 –> 00:26:10.000
I, I know, like these 3rd party vendors. Kevin, what can you tell me about.

00:26:10.000 –> 00:26:13.000
These companies, like Vive and compliance, depot.

00:26:13.000 –> 00:26:17.000
That, I think are becoming more mainstream.

00:26:17.000 –> 00:26:22.000
As part of the construction vetting process. What.

00:26:22.000 –> 00:26:24.000
I mean. I think she’s gone over a little bit about it, but.

00:26:24.000 –> 00:26:32.000
Yeah, knew. She touched on it. They they drilled down, they properly. License. Do they have financial capacity? Have there been issues.

00:26:32.000 –> 00:26:38.000
But a lot of our conversation has been focused on the vendor selection for capital projects.

00:26:38.000 –> 00:26:42.000
And we need to have this vetting.

00:26:42.000 –> 00:26:43.000
Hmm.

00:26:43.000 –> 00:26:58.000
For all contractors who service the property. And this is where the vibe and the compliance depot programs come into play, because any vendor, including the the capital project, have to go through this system and vetted.

00:26:58.000 –> 00:27:02.000
A couple of years ago. It was an emergency end of the day.

00:27:02.000 –> 00:27:10.000
You know, I’m speaking to more the operational side, the snow removal, the landscape, the plumbing. We heard about a plumber earlier, an electrician.

00:27:10.000 –> 00:27:16.000
Multi Condominium Association brought in electrician in.

00:27:16.000 –> 00:27:22.000
They were having an issue with the distribution panel. The electrician went down to the main panel in the building.

00:27:22.000 –> 00:27:27.000
And accidentally the screwdriver fell out of his shirt pocket.

00:27:27.000 –> 00:27:30.000
That screwdriver hit the main bus duct.

00:27:30.000 –> 00:27:37.000
Which shorted out the building, causing millions of dollars of damage, not to mention putting electrician in the hospital.

00:27:37.000 –> 00:27:40.000
This was an unvet, very innocent thing.

00:27:40.000 –> 00:27:44.000
But it’s accidental, and if the consequences.

00:27:44.000 –> 00:27:47.000
It cause issues for this association. Now for a number of years.

00:27:47.000 –> 00:27:51.000
Insurance companies are completely aware.

00:27:51.000 –> 00:27:55.000
That associations hire contractors to perform their work.

00:27:55.000 –> 00:28:00.000
Every insurance company. Application for Condominiums has a whole series of questions.

00:28:00.000 –> 00:28:03.000
About how the contract is being vetted.

00:28:03.000 –> 00:28:10.000
Yeah, do. Is there a written contract or agreement? Do they have a million dollars? Is it hold harmless.

00:28:10.000 –> 00:28:13.000
Is a requirement to name additional insured.

00:28:13.000 –> 00:28:18.000
Every single insurance application for condominiums include these questions.

00:28:18.000 –> 00:28:24.000
And when an underwriter sees nose to these answers, they decline the account.

00:28:24.000 –> 00:28:26.000
It’s just good business practice.

00:28:26.000 –> 00:28:30.000
To to vet your contractors, all your contractors.

00:28:30.000 –> 00:28:39.000
And the days when Association said, well, you know Vinny’s been working for us for 10 years, and we can’t find anyone cheaper.

00:28:39.000 –> 00:28:46.000
Well, you know what that just is, a potential liability for the association, and you know we all have to step up and.

00:28:46.000 –> 00:28:49.000
Protect the assets of the Association.

00:28:49.000 –> 00:28:58.000
It’s it’s essential. And that’s how you’re gonna protect your insurability, but also your financial capacity.

00:28:58.000 –> 00:28:59.000
And we do get a lot of Oh.

00:28:59.000 –> 00:29:00.000
Hey, Kevin? I’m sorry. Go ahead. Notion.

00:29:00.000 –> 00:29:09.000
Sorry, Ed, what I just want to touch on one thing that Kevin said it. We do get sometimes a lot of pushback about this. Specifically, there’s a cost involved.

00:29:09.000 –> 00:29:25.000
But it really is protecting the association. And again, to Kevin’s point, crazy things happen in our buildings, things we don’t expect, things we don’t anticipate incidents that, again, aren’t necessarily done with any malice or any you know.

00:29:25.000 –> 00:29:29.000
Any that no one wants to necessarily do harm.

00:29:29.000 –> 00:29:40.000
But you know things happen, and this is the world is changing now, and you know things are different now, using, you know, the local person who, you know we love to use, but.

00:29:40.000 –> 00:29:48.000
They don’t have the right insurance. You know you’re you’re really putting yourselves at risk. And sometimes it’s difficult because.

00:29:48.000 –> 00:29:52.000
Price seems to drive a lot of decisions which.

00:29:52.000 –> 00:29:54.000
You know, aren’t always the best.

00:29:54.000 –> 00:30:00.000
You know, way to go, because when you’re dealing with a multimillion dollar asset.

00:30:00.000 –> 00:30:04.000
You know, as you said earlier, thinking like Ceos.

00:30:04.000 –> 00:30:10.000
And business people is really the way to go when you’re making decisions like this.

00:30:10.000 –> 00:30:16.000
So. So one of the things I noticed on this slides on the bottom of the slide.

00:30:16.000 –> 00:30:20.000
And you know, you know, we’re talking about the next generation.

00:30:20.000 –> 00:30:26.000
My understanding is like these programs they have, like, built in artificial intelligence.

00:30:26.000 –> 00:30:34.000
And let’s say you have 10 or 12 vendors on a property. My understanding is these programs will notify you.

00:30:34.000 –> 00:30:43.000
If, an insurance policy of a vendor has lapsed or expired, which will allow you to immediately.

00:30:43.000 –> 00:30:46.000
Contact, that person which which otherwise.

00:30:46.000 –> 00:30:48.000
I mean I I mean to me. That’s.

00:30:48.000 –> 00:30:54.000
You know the the the text of this slide is science and progress.

00:30:54.000 –> 00:30:57.000
You know to me that’s science and progress, and.

00:30:57.000 –> 00:31:00.000
And sort of keeping us.

00:31:00.000 –> 00:31:02.000
Keep on top of something which.

00:31:02.000 –> 00:31:05.000
In the past like, how would you keep on top of.

00:31:05.000 –> 00:31:09.000
Whether or not the landscaper and the snow plow guys.

00:31:09.000 –> 00:31:13.000
Insurance certificate has ex has been cancelled.

00:31:13.000 –> 00:31:17.000
5 months into the contract you wouldn’t be able. You wouldn’t be able to keep on top of that.

00:31:17.000 –> 00:31:18.000
So this.

00:31:18.000 –> 00:31:31.000
Yeah, actually, yeah, the service. The actual 3rd party vendor notifies the vendor that their insurance is about to expire, that they need to submit the updated information, and they’ll also notify.

00:31:31.000 –> 00:31:42.000
The management company that that’s in progress. And if it doesn’t happen we’re notified as well. So it’s it’s great like that. And look at insurance every year.

00:31:42.000 –> 00:31:50.000
So it it like you said like who has the bandwidth to, you know, mark down every single time a vendor’s insurance.

00:31:50.000 –> 00:31:52.000
Expires. That’s that’s.

00:31:52.000 –> 00:31:57.000
Probably not realistic in our in our daily life as as

00:31:57.000 –> 00:32:01.000
You know, property, managers and whatnot.

00:32:01.000 –> 00:32:02.000
Yeah. The.

00:32:02.000 –> 00:32:03.000
Right.

00:32:03.000 –> 00:32:04.000
Yes.

00:32:04.000 –> 00:32:05.000
Yeah.

00:32:05.000 –> 00:32:06.000
And it could be cancelled with no, for any number of reasons, as Kevin will tell you. And how would you know.

00:32:06.000 –> 00:32:12.000
The well, the other thing to keep in mind that when you, when you’re not part of a vibe or.

00:32:12.000 –> 00:32:15.000
Clients depot program, and you’re not listed as additional.

00:32:15.000 –> 00:32:18.000
No one would know if your insurance gets cancelled.

00:32:18.000 –> 00:32:29.000
And what’s concerning is oftentimes the small contractors who service the property. They don’t even know it’s been cancelled because they do their paperwork on the weekend.

00:32:29.000 –> 00:32:40.000
And you know, I guess last weekend had a great football game, and so they didn’t do their paperwork. They didn’t open the envelope that said, if you fail to complete your audit, your insurance is cancelled on Tuesday.

00:32:40.000 –> 00:32:41.000
I don’t know. I don’t know that there’ve been that many.

00:32:41.000 –> 00:32:46.000
They had no idea, but they handed you a certificate of insurance on Monday.

00:32:46.000 –> 00:32:49.000
And I would encourage anyone to read the top section of an.

00:32:49.000 –> 00:32:53.000
Insurance certificate is really meaningless.

00:32:53.000 –> 00:32:56.000
Unless you have additional insured status.

00:32:56.000 –> 00:33:01.000
Through a written contract. And so you’ve got to be really careful about this stuff.

00:33:01.000 –> 00:33:09.000
Well, one of the things, Kevin, that you mentioned. I don’t know that anybody’s really been enthralled with any football games on Sundays, so maybe.

00:33:09.000 –> 00:33:12.000
Maybe maybe that would help. But.

00:33:12.000 –> 00:33:14.000
You know one of the things that.

00:33:14.000 –> 00:33:20.000
That I’ve actually had. If if you can believe it, I I’ve actually gotten a call.

00:33:20.000 –> 00:33:26.000
From a board president and said, You know, like, Hey, we want to use this vendor.

00:33:26.000 –> 00:33:29.000
And

00:33:29.000 –> 00:33:33.000
The the management company is requiring them to.

00:33:33.000 –> 00:33:35.000
To go through.

00:33:35.000 –> 00:33:41.000
The one of these programs, whether it’s 5 or compliance depot.

00:33:41.000 –> 00:33:47.000
And and th there’s a cost to the to the vendor.

00:33:47.000 –> 00:33:51.000
And I I don’t think it’s I. It was like a hundred $50, right? So.

00:33:51.000 –> 00:33:55.000
So I get this call, and it, like the call goes on for half an hour.

00:33:55.000 –> 00:33:57.000
Quite frankly the cost of the call.

00:33:57.000 –> 00:34:00.000
Cost the association more than it did.

00:34:00.000 –> 00:34:02.000
For the vendor to simply.

00:34:02.000 –> 00:34:04.000
Pay to get vetted.

00:34:04.000 –> 00:34:07.000
But to to me.

00:34:07.000 –> 00:34:13.000
To me, if you know one of the like we knew. She talked about red flags.

00:34:13.000 –> 00:34:18.000
If I’ve got a vendor. That’s saying I don’t want to pay.

00:34:18.000 –> 00:34:21.000
A $150.

00:34:21.000 –> 00:34:30.000
To usually get what is a pretty good contract for them. Usually association contracts are good contracts.

00:34:30.000 –> 00:34:33.000
It’s a good client to have.

00:34:33.000 –> 00:34:38.000
And if they’re refusing or barking at $150.

00:34:38.000 –> 00:34:40.000
To be vetted.

00:34:40.000 –> 00:34:42.000
Does that raise a red flag?

00:34:42.000 –> 00:34:45.000
In your mind Nushik or Kevin.

00:34:45.000 –> 00:34:46.000
I think it raises one month.

00:34:46.000 –> 00:34:51.000
Yeah, it’s a complete red flag.

00:34:51.000 –> 00:35:08.000
I mean most times when they sign up for to work for management company, they become the vendor for that management company, and it’s not usually just for one property they can. Service multiple properties is a great stream of revenue there, and the contractors

00:35:08.000 –> 00:35:17.000
Has a peace of mind, knowing that if they do cause damage, that it’s going to be protected, that they’re not going to injure a 3rd party, be it the association.

00:35:17.000 –> 00:35:19.000
Property or someone.

00:35:19.000 –> 00:35:20.000
On the property. It’s essential.

00:35:20.000 –> 00:35:21.000
And and I go ahead.

00:35:21.000 –> 00:35:28.000
I think it’s it’s true, like, I think, one of the things that really drives this is, it’s a change, you know. It’s it’s different.

00:35:28.000 –> 00:35:29.000
Yeah.

00:35:29.000 –> 00:35:43.000
You know I’ve never done this before, you know. Oh, my gosh! It’s you know I have to. I have to. It’s work for them quite honestly. They have to go, you know. They have to go through. They have to register. They have to provide a lot of information. Then they have to pay, but.

00:35:43.000 –> 00:35:52.000
What they’re doing is they’re really setting themselves up also, for you know, to be view as you said, Ed.

00:35:52.000 –> 00:36:01.000
You know, ready to serve this community and a lot of time, you know, I think it’s shifted a lot as this becomes more common in our world.

00:36:01.000 –> 00:36:19.000
It. We’ve seen a little bit less resistance, but to your point, and you know there is resistance sometimes, and it’s just a matter really of educating our boards and communities as to why we’re doing this and and showing them. Look at this is what happens. If you could happen if you don’t, and you know we love this vendor, too. He’s fantastic.

00:36:19.000 –> 00:36:25.000
But let’s let’s protect. Let’s protect the community. Let’s protect him. Also to make sure that he.

00:36:25.000 –> 00:36:35.000
Got the right, you know, the right insurance to do the work, and that the licensing is all there. So it it’s it’s really it’s really a situation where everyone benefits from this.

00:36:35.000 –> 00:36:46.000
And and just really again, educating everyone, understanding that. Yes, this is a little bit of a change. But this is the direction that that you know things are going in now, and it will protect everyone.

00:36:46.000 –> 00:36:51.000
Well, I think I think that is one of the main themes here is about sort of.

00:36:51.000 –> 00:36:55.000
Changing the mindset, and we’ve all had to go through it. I had to.

00:36:55.000 –> 00:37:01.000
I was one of the last people, I think, in America, or the world that still had a blackberry.

00:37:01.000 –> 00:37:03.000
And eventually I had to change it to.

00:37:03.000 –> 00:37:07.000
to an iphone and then.

00:37:07.000 –> 00:37:14.000
You know, as as Kevin mentioned, you know, some people may know big patriots, fan season ticket holder.

00:37:14.000 –> 00:37:20.000
And I miss my paper tickets, and and you know I gotta make sure I gotta put things in the wallet, and it’s.

00:37:20.000 –> 00:37:24.000
But but that the world around us is changing.

00:37:24.000 –> 00:37:30.000
And while not all changes are for the better, I I do think this.

00:37:30.000 –> 00:37:35.000
This is this is one of those changes

00:37:35.000 –> 00:37:39.000
So you know one of the things.

00:37:39.000 –> 00:37:41.000
You know. Let’s talk about.

00:37:41.000 –> 00:37:45.000
Why, we vet Kevin like like what like.

00:37:45.000 –> 00:37:48.000
Tell me a little bit about why we need to.

00:37:48.000 –> 00:37:51.000
Vetting you’ve you’ve alluded to some of it.

00:37:51.000 –> 00:37:55.000
With examples.

00:37:55.000 –> 00:38:01.000
Well in turn. Every association has to have vendors in, and one of the reasons is.

00:38:01.000 –> 00:38:12.000
Every application. The insurance company, say I, you know, who are you using? We touched on this earlier. They want to know that there’s good contractual risk transfer in place.

00:38:12.000 –> 00:38:26.000
Because when there is damage to the property or someone’s injured, they have the pathway to go after the party that caused the damage, and to try to restore the association financially.

00:38:26.000 –> 00:38:28.000
You know when I.

00:38:28.000 –> 00:38:36.000
It really the vetting? It comes down to contractual risk. Maybe we’ll skip ahead a little bit.

00:38:36.000 –> 00:38:40.000
Yeah, I don’t show. Everyone understands what contractual risk transfer is.

00:38:40.000 –> 00:38:44.000
And it’s really it’s asking the contractor.

00:38:44.000 –> 00:38:46.000
So you’re paying a lot of money to.

00:38:46.000 –> 00:38:54.000
Whether it’s being the snow removal or roofing the landscape or contract, you want them to be responsible for their actions.

00:38:54.000 –> 00:39:01.000
So if the contractor were to cause damage to the property to someone. You have a written contract.

00:39:01.000 –> 00:39:06.000
That requires them to stand behind the damage they caused.

00:39:06.000 –> 00:39:10.000
When when there’s.

00:39:10.000 –> 00:39:16.000
So that’s the rest. And and it kind of makes sense. If you’re gonna pay a roofer 2 million dollars to put.

00:39:16.000 –> 00:39:20.000
Roof on your buildings. You wanna make sure that they have the ability.

00:39:20.000 –> 00:39:26.000
To pay for a fund any damage or injury they cause. I mean, it makes sense.

00:39:26.000 –> 00:39:32.000
And we talked about it earlier. There are a lot of contractors will turn around and ask the association.

00:39:32.000 –> 00:39:36.000
To name them as additional insured, which is absolutely backwards.

00:39:36.000 –> 00:39:38.000
You know.

00:39:38.000 –> 00:39:40.000
When I look at the.

00:39:40.000 –> 00:39:50.000
Capital, the risk transfer. It goes way beyond the capital project, where there are a lot of eyes on that 2 million roofing contract. But not a lot of eyes.

00:39:50.000 –> 00:39:57.000
When you bring the plumber into change of water, so it it runs a whole gamut of what we’re trying to do.

00:39:57.000 –> 00:40:07.000
You know, and and when these poor transfer we had an incident 2 years ago, an association there was a slip and fall in the parking lot in the wintertime.

00:40:07.000 –> 00:40:12.000
So the insurance company reported the claim. The insurance company just came in. They looked at the contract.

00:40:12.000 –> 00:40:15.000
Which not only did it not.

00:40:15.000 –> 00:40:31.000
There wasn’t a contract, so they weren’t named as additional insured. But when they looked at the contractors insurance, and this is to the vetting point again. The contractor was a landscape contractor who was not set up for liability, for snow removal.

00:40:31.000 –> 00:40:40.000
So they’re out plowing a parking lot for an association, and they don’t even have the insurance to do that. It’s the wrong type of insurance.

00:40:40.000 –> 00:40:42.000
That association was non-renewed.

00:40:42.000 –> 00:40:45.000
And those those are the issues that come.

00:40:45.000 –> 00:40:49.000
With it, and you know we we touched on it earlier again. Is.

00:40:49.000 –> 00:40:53.000
You. You can’t sign the contract.

00:40:53.000 –> 00:41:05.000
Those those are one sided. We need to get the B version of those contracts. But better yet, we need to be on an Aia contract, because, as Ed pointed out, they’re designed to be fair to all parties involved.

00:41:05.000 –> 00:41:06.000
Hmm.

00:41:06.000 –> 00:41:07.000
Oh!

00:41:07.000 –> 00:41:09.000
There needs to be some negotiation, I mean.

00:41:09.000 –> 00:41:11.000
You know it’s.

00:41:11.000 –> 00:41:14.000
The the lawyer doesn’t need to like.

00:41:14.000 –> 00:41:19.000
Always start from scratch. But there are key terms. There are key things. There’s.

00:41:19.000 –> 00:41:21.000
There are the indemnity, provisions.

00:41:21.000 –> 00:41:23.000
They’re the insurance provisions.

00:41:23.000 –> 00:41:28.000
There’s the vetting, and and I wanted to just go back a little bit.

00:41:28.000 –> 00:41:32.000
you know, since I jumped Kevin.

00:41:32.000 –> 00:41:35.000
You know? Why do we fail?

00:41:35.000 –> 00:41:38.000
And and why is it important?

00:41:38.000 –> 00:41:42.000
Today, now 2024. Well.

00:41:42.000 –> 00:41:47.000
We all know that the lending industry right now is tight.

00:41:47.000 –> 00:41:50.000
Interest. Rates are up.

00:41:50.000 –> 00:41:53.000
And the the lenders.

00:41:53.000 –> 00:41:58.000
In a condominium. Anybody that’s having to deal with lender questionnaires.

00:41:58.000 –> 00:42:00.000
Knows.

00:42:00.000 –> 00:42:05.000
That it’s not as easy to get a loan.

00:42:05.000 –> 00:42:07.000
Now as it was.

00:42:07.000 –> 00:42:12.000
15 years ago. The lender question is a very detailed.

00:42:12.000 –> 00:42:16.000
Fanny May is. Fanny and Freddie Mac are on top of the lenders.

00:42:16.000 –> 00:42:21.000
They don’t want another lending industry collapse like they hadn’t.

00:42:21.000 –> 00:42:23.000
2,008.

00:42:23.000 –> 00:42:26.000
Kevin insurance industry.

00:42:26.000 –> 00:42:31.000
You know one of the things that I’ve been seeing in new. I’m sure you’ve been seeing.

00:42:31.000 –> 00:42:34.000
And this freaks boards out.

00:42:34.000 –> 00:42:38.000
Because they’re seeing skyrocketing insurance premiums like.

00:42:38.000 –> 00:42:40.000
I don’t know. 37.

00:42:40.000 –> 00:42:41.000
50%.

00:42:41.000 –> 00:42:43.000
How about 200%.

00:42:43.000 –> 00:42:44.000
200%, and then.

00:42:44.000 –> 00:42:51.000
Yeah, that’s what’s going on. And you know, when I when I think about contractual risk.

00:42:51.000 –> 00:42:54.000
It, it should be essential.

00:42:54.000 –> 00:42:56.000
But when I when I’m thinking about it.

00:42:56.000 –> 00:43:03.000
Not performing effective risk. Transfer in my mind is a self inflicted wound.

00:43:03.000 –> 00:43:08.000
The industry. The insurance industry for the last 18 months is really tightened up.

00:43:08.000 –> 00:43:12.000
After the collapse of the Champlain Towers in 20.

00:43:12.000 –> 00:43:18.000
There’s been a lot of focus on the industry and how we’re doing work within the industry. But.

00:43:18.000 –> 00:43:28.000
On average. Well, let me say this way. For the 1st time in 18 months I saw a single digit premium increase on the renewal.

00:43:28.000 –> 00:43:32.000
Otherwise I’ve been looking at double digit or triple digit increases.

00:43:32.000 –> 00:43:40.000
And the associations that are getting tagged with these big client increases are those the ones that are having claims.

00:43:40.000 –> 00:43:51.000
And the last thing in the world you want to do is have to file a claim on your master policy because you didn’t properly vet your contractor. That’s a self-inflicted wound.

00:43:51.000 –> 00:43:52.000
And and.

00:43:52.000 –> 00:43:55.000
And then it it’ll it’ll live with you for 3 to 5 years.

00:43:55.000 –> 00:44:01.000
You. You know the funny thing, and I know you know this because I tried to work with you on a couple of these properties.

00:44:01.000 –> 00:44:03.000
But for the 1st time in my career.

00:44:03.000 –> 00:44:07.000
I’ve seen some associations have to go to self insurance.

00:44:07.000 –> 00:44:10.000
They they can’t get a policy.

00:44:10.000 –> 00:44:11.000
Correct.

00:44:11.000 –> 00:44:17.000
There, there they cannot obtain even into the secondary market. Can’t get a master policy.

00:44:17.000 –> 00:44:19.000
And those places are.

00:44:19.000 –> 00:44:23.000
Crumbling in their boots, because if there’s a loss.

00:44:23.000 –> 00:44:26.000
It’s it’s it’s on.

00:44:26.000 –> 00:44:27.000
Yeah.

00:44:27.000 –> 00:44:31.000
Everybody, and and I’ve even spoken with a couple of those associations, and said.

00:44:31.000 –> 00:44:35.000
Do we? Wanna do we wanna terminate the condominium.

00:44:35.000 –> 00:44:36.000
Yeah.

00:44:36.000 –> 00:44:39.000
And and sell the property to somebody else, because.

00:44:39.000 –> 00:44:41.000
Because if you get hit.

00:44:41.000 –> 00:44:43.000
What you know. It’s a kill. It really is.

00:44:43.000 –> 00:44:44.000
Good. Yeah.

00:44:44.000 –> 00:44:48.000
And and you know we’ve we’ve got this.

00:44:48.000 –> 00:44:51.000
We’ve got like I said. We got the tightened

00:44:51.000 –> 00:44:54.000
Market. As a result, as Kevin mentioned, Towers.

00:44:54.000 –> 00:44:58.000
Fanny Mays got a black list. Certain associations.

00:44:58.000 –> 00:45:01.000
Where people can’t get loans.

00:45:01.000 –> 00:45:08.000
And that blacklist is for things like inadequate insurance.

00:45:08.000 –> 00:45:09.000
Inadequate reserves.

00:45:09.000 –> 00:45:12.000
And critical repairs. I would say those are the 3.

00:45:12.000 –> 00:45:13.000
Yeah.

00:45:13.000 –> 00:45:16.000
The 3 biggest things, and and I know.

00:45:16.000 –> 00:45:20.000
When we were putting this program together. You know she wanted to.

00:45:20.000 –> 00:45:23.000
Sort of, you know. Remind.

00:45:23.000 –> 00:45:29.000
The boards remind the boards of what their duty.

00:45:29.000 –> 00:45:31.000
Is when they’re elected. A lot of.

00:45:31.000 –> 00:45:33.000
A lot of board members.

00:45:33.000 –> 00:45:37.000
They run for the board on a campaign like

00:45:37.000 –> 00:45:39.000
You know no new taxes.

00:45:39.000 –> 00:45:42.000
I’m gonna keep condo fees down.

00:45:42.000 –> 00:45:45.000
But notion. What is their duty?

00:45:45.000 –> 00:45:53.000
Yeah. So I mean, that’s definitely something that we really try to, you know, really educate our boards, and, you know, have them aligned in.

00:45:53.000 –> 00:45:56.000
Their duty, their fiduciary responsibility.

00:45:56.000 –> 00:46:02.000
To protect and preserve the asset, and to make the necessary decisions in order to do that.

00:46:02.000 –> 00:46:05.000
And you know it’s not always popular, but.

00:46:05.000 –> 00:46:09.000
You know, that’s that’s their job. They’re the ones that are tasked.

00:46:09.000 –> 00:46:11.000
And have been duly elected or appointed.

00:46:11.000 –> 00:46:17.000
To make sure that what is being done in the community is proper and.

00:46:17.000 –> 00:46:19.000
And all of the maintenance.

00:46:19.000 –> 00:46:22.000
That is required is done.

00:46:22.000 –> 00:46:33.000
And if it’s not, then, you know, imagine that the consequences of that. And you know we don’t want to think about anything awful. But if you know the you know if you are board, and you know that your roof.

00:46:33.000 –> 00:46:37.000
You’ve looked at your reserve study, you know. It’s telling you that you’ve got to replace it.

00:46:37.000 –> 00:46:46.000
You’ve got to replace it, or you’ve got balconies. You’ve got other major components in your communities that need to be.

00:46:46.000 –> 00:46:52.000
Replaced that it is your duty to to, you know. Make those.

00:46:52.000 –> 00:47:03.000
And in terms of sort of the day to day. It’s your duty to make sure that the property is being well maintained every day as well, and not to try to necessarily cut corners, because.

00:47:03.000 –> 00:47:07.000
Okay, we we understand. We want, you know, our job is to help.

00:47:07.000 –> 00:47:11.000
Our communities, and all of us, on this call together.

00:47:11.000 –> 00:47:17.000
You know, as your business partners, to try to make sure that you know we can help. You know.

00:47:17.000 –> 00:47:23.000
Do your do the do the best that we can in every way to be fiscally responsible.

00:47:23.000 –> 00:47:29.000
But there’s also this duty to make sure that the the asset is being properly maintained.

00:47:29.000 –> 00:47:32.000
And and to that end what I’m finding is.

00:47:32.000 –> 00:47:38.000
The insurance companies, particularly the Dno carriers, are asking for copies of the financials.

00:47:38.000 –> 00:47:43.000
They’re doing quick financial ratios on it. They’re looking at what’s being funded for reserve.

00:47:43.000 –> 00:47:50.000
And Einstein to run into situations where I can’t get special coverage, special perils.

00:47:50.000 –> 00:47:56.000
Which is the broadest form of property, and we want special perils. Your condominium.

00:47:56.000 –> 00:48:05.000
Ask the special perils, but because roos haven’t been done and other updates haven’t been done. I’m getting basic perils. And so not everything’s being covered.

00:48:05.000 –> 00:48:08.000
The other thing I wanted to touch on is.

00:48:08.000 –> 00:48:14.000
You know, we I spoke a lot about the operational vetting of operational contractors and.

00:48:14.000 –> 00:48:29.000
You know, when when you sit down and think about that, that might seem like an insurmountable task. But it’s really simple. You run the list of 1099. So the last couple of years identify, you know, 90% of your vendors who service the property.

00:48:29.000 –> 00:48:34.000
You put them on a contract with insurance.

00:48:34.000 –> 00:48:51.000
Hold harmless language additional insured, and you leave it as an evergreen contract. It continues to run until.

00:48:51.000 –> 00:48:52.000
I.

00:48:52.000 –> 00:48:57.000
So you list you 15 vendors. You sign up to a contractor, and those become the preferred vendors, and you have effective contractual risk transfer I just wanted to touch on. It’s it’s really easy to do. It takes a little bit of work upfront, but then it’s just.

00:48:57.000 –> 00:48:59.000
Let AI take it from there and tell you.

00:48:59.000 –> 00:49:03.000
That’s actually, that’s actually a good talking point.

00:49:03.000 –> 00:49:07.000
And this will be the last couple we’re gonna get into construction management.

00:49:07.000 –> 00:49:10.000
Couple of questions, both for you and.

00:49:10.000 –> 00:49:12.000
You Kevin.

00:49:12.000 –> 00:49:17.000
One of the questions that I saw in the chat was.

00:49:17.000 –> 00:49:20.000
You know, we talk about Aia when it comes to construction.

00:49:20.000 –> 00:49:24.000
Is there an Aia type form.

00:49:24.000 –> 00:49:27.000
For operational contracts.

00:49:27.000 –> 00:49:29.000
I I don’t know that I’ve seen.

00:49:29.000 –> 00:49:30.000
I haven’t seen what Ed.

00:49:30.000 –> 00:49:31.000
8.

00:49:31.000 –> 00:49:37.000
No.

00:49:37.000 –> 00:49:38.000
Yeah.

00:49:38.000 –> 00:49:40.000
But I will tell you. I’ve worked with some associations and give them the bullet points of, and then they’ll hire their attorney and reduce it to.

00:49:40.000 –> 00:49:43.000
Essentially a two-page contract.

00:49:43.000 –> 00:49:46.000
Where it says, the scope of work is as.

00:49:46.000 –> 00:49:51.000
The pricing is as agreed, and then it has all the insurance hold harmless, and then.

00:49:51.000 –> 00:49:54.000
That’s a 2 page contract that we want signed.

00:49:54.000 –> 00:50:01.000
I got an idea, how about we all get together and create this standard form and.

00:50:01.000 –> 00:50:05.000
And and go into business selling and pitching the.

00:50:05.000 –> 00:50:07.000
Aia of operational contract.

00:50:07.000 –> 00:50:08.000
Yeah, yeah.

00:50:08.000 –> 00:50:10.000
What one of the other questions was.

00:50:10.000 –> 00:50:15.000
And I don’t know if you’ve encountered this.

00:50:15.000 –> 00:50:17.000
There was a question about.

00:50:17.000 –> 00:50:19.000
Bidders and.

00:50:19.000 –> 00:50:22.000
A a thought of having.

00:50:22.000 –> 00:50:26.000
A pre bid conference with all vendors.

00:50:26.000 –> 00:50:34.000
To get everybody to have QA. And establish a level playing field.

00:50:34.000 –> 00:50:48.000
Forbidding, because, you know, some people some contractors, might feel oh, well, their preferred vendors. And it’s not as level. Have you guys ever done anything or or contemplated doing anything like a pre bidding conference.

00:50:48.000 –> 00:50:53.000
We have done that in the past for certain projects where, you know we, it really requires.

00:50:53.000 –> 00:51:02.000
The bidders to be on site where we can give them a tour where the engineer can talk a little bit more about the actual scope and what’s required. So in that sense.

00:51:02.000 –> 00:51:10.000
I don’t see that there’s anything wrong with that. I mean, that’s that’s a way to get everyone understanding of what the project entails.

00:51:10.000 –> 00:51:18.000
And you know they’ll see who else is bidding. But you know, what difference does it make? I don’t think that makes a big difference, but I think in terms of being efficient.

00:51:18.000 –> 00:51:25.000
For projects that you know require that. I think that’s that’s perfectly acceptable. We have done that in the past.

00:51:25.000 –> 00:51:31.000
Now, here’s here’s another. So onto the next slide no one ever said it would be this hard.

00:51:31.000 –> 00:51:34.000
Is sometimes the management of the project right.

00:51:34.000 –> 00:51:35.000
Yeah.

00:51:35.000 –> 00:51:37.000
So you vetted you, selected.

00:51:37.000 –> 00:51:43.000
We negotiated a good contract. We got everything in place. We got the policies.

00:51:43.000 –> 00:51:47.000
Now now the Association has to deal with.

00:51:47.000 –> 00:51:51.000
The construction project, and and let’s assume for the for.

00:51:51.000 –> 00:51:55.000
Sake of argument that we’re talking about a construction project so.

00:51:55.000 –> 00:52:00.000
In all likelihood you’re dealing with an architect.

00:52:00.000 –> 00:52:05.000
Who is, or an engineer.

00:52:05.000 –> 00:52:08.000
Who is overseeing the project.

00:52:08.000 –> 00:52:10.000
And recommending.

00:52:10.000 –> 00:52:17.000
When payments should be made like on a like, okay, he’s hit 10%. He’s hit 20.

00:52:17.000 –> 00:52:21.000
The scope he’s in compliance with.

00:52:21.000 –> 00:52:24.000
His contract documents, but then.

00:52:24.000 –> 00:52:29.000
Then you know th, then it’s more than thation.

00:52:29.000 –> 00:52:30.000
Yeah.

00:52:30.000 –> 00:52:31.000
So so tell me.

00:52:31.000 –> 00:52:34.000
Tell me like like you’re managing a construction project.

00:52:34.000 –> 00:52:37.000
What is the manager’s role? Usually.

00:52:37.000 –> 00:52:40.000
At that point. It’s not like.

00:52:40.000 –> 00:52:41.000
Like you guys can just ignore ignore the contract.

00:52:41.000 –> 00:52:53.000
Oh, no, yeah, definitely not. And there and there’s there’s a lot that needs to be done. That’s sort of separate from the day to day responsibilities of what we’re seeing. The community.

00:52:53.000 –> 00:53:04.000
There’s a lot of entities involved that need to be managed. There’s regular meetings, there’s communications to owners, to vendors, to architect, making sure that everyone is.

00:53:04.000 –> 00:53:23.000
On the same page, managing the schedule. Change orders, approving processing that you know the progress, making sure to your point that they’re being adequately signed off on by the architect or engineer. Keeping track of all the invoices and all the payments sort of in a, you know, separate.

00:53:23.000 –> 00:53:33.000
Spreadsheet that you can maintain and keep and share with the board. So you know exactly where you are, you know. Again change orders, and then the day to day of having sort of that.

00:53:33.000 –> 00:53:36.000
Actual construction happening in the community.

00:53:36.000 –> 00:53:51.000
A arranging access, you know, to common areas sometimes units, you know, oftentimes units ensuring that the site is well maintained during the construction process. I mean, this is people’s homes, you know, sometimes as as much as we try to be.

00:53:51.000 –> 00:53:56.000
You know fully, you know. Give our construction.

00:53:56.000 –> 00:54:02.000
Partners and our vendors as much information about the sort of the do’s and don’ts of what to do when you’re on site.

00:54:02.000 –> 00:54:16.000
You know. Are they playing live music? Are they leaving trash everywhere? Is the site picked up properly at the end of the day, you know again, our communications being adequately sent out to you know, boards. Owners are the our meetings being held on a regular basis.

00:54:16.000 –> 00:54:22.000
So there’s a lot to it. And it does require, you know, experience and knowledge.

00:54:22.000 –> 00:54:28.000
And a good skill set aside from the day to day. You know aspects of the building operations.

00:54:28.000 –> 00:54:35.000
To do this, and it’s a big investment. So it needs to be done, you know, with a deft hand and a lot of attention to detail.

00:54:35.000 –> 00:54:41.000
And and sometimes, you know, like I I’ve encountered some board, say, well, we don’t want to pay the.

00:54:41.000 –> 00:54:48.000
The manager a fee.

00:54:48.000 –> 00:54:49.000
Hmm.

00:54:49.000 –> 00:54:51.000
You know, which is sometimes contained in the managers contract. So let’s go. Independent. Manager.

00:54:51.000 –> 00:54:54.000
You know.

00:54:54.000 –> 00:54:59.000
Does that really change? I I mean, it’s not like you can’t be involved then, either. Right.

00:54:59.000 –> 00:55:05.000
Yeah. And for you know, what happens then is, the manager is still. I mean.

00:55:05.000 –> 00:55:07.000
If there’s sort of a 3rd party site.

00:55:07.000 –> 00:55:15.000
Person managing independent, independently overseeing this, they still have to have the manager make sure that they have access.

00:55:15.000 –> 00:55:20.000
They still have to, you know, communicate with the management still has to do.

00:55:20.000 –> 00:55:28.000
Many tasks in order to make that successful as well. And you know I’m not advocating. No, this isn’t about necessarily the fee, but.

00:55:28.000 –> 00:55:38.000
The fee is covering this, all of these extra duties that the management company is providing for this project.

00:55:38.000 –> 00:55:39.000
Well, and and.

00:55:39.000 –> 00:55:49.000
So, and and plus. They know that they know the property. They know the owners, they know, you know. They know the ins and outs of sort of the hot buttons, and how best.

00:55:49.000 –> 00:55:53.000
To help the community sort of get through this with minimal interruption.

00:55:53.000 –> 00:55:57.000
Yeah. And and my point wasn’t to highlight that either, other than.

00:55:57.000 –> 00:56:00.000
You know. Again, I think we’re talking about changing the mindset.

00:56:00.000 –> 00:56:04.000
Yes.

00:56:04.000 –> 00:56:05.000
Yep.

00:56:05.000 –> 00:56:07.000
And and the mindset is, oh, why do I have to pay this fee? I don’t want to pay this fee. Let’s not pay this fee. Let’s.

00:56:07.000 –> 00:56:10.000
And without an understanding of what.

00:56:10.000 –> 00:56:17.000
Is involved, and and that like, you know, you just don’t have a contract to walk onto the site.

00:56:17.000 –> 00:56:25.000
And perform the work, and the manager just goes and manages the property, and they’re like separate entities. The.

00:56:25.000 –> 00:56:28.000
The. You know it’s it’s a major disruption.

00:56:28.000 –> 00:56:33.000
And a lot of times they need to find things they need. Where are the utilities? Where are the shut offs? Whereas.

00:56:33.000 –> 00:56:41.000
How do I get into Mrs. Jones unit to do the mold remediation? How do I do this? And the and the only answer to that.

00:56:41.000 –> 00:56:44.000
Is usually the manager.

00:56:44.000 –> 00:56:50.000
So it’s it’s not like you can get away for it. Get away from it, and it’s not like it’s.

00:56:50.000 –> 00:56:55.000
Like like there’s not some sort of value.

00:56:55.000 –> 00:56:59.000
I I did get a question in the chat about something I mentioned earlier.

00:56:59.000 –> 00:57:06.000
Which was, you know. Somebody said I was told that condo docs don’t allow associations to self insure.

00:57:06.000 –> 00:57:16.000
I understood to be mostly all kind of docs. Is this a specific association? And the answer is, no every single condominium I’ve ever seen.

00:57:16.000 –> 00:57:17.000
Yeah.

00:57:17.000 –> 00:57:20.000
Usually requires the association to obtain a master.

00:57:20.000 –> 00:57:22.000
At full replacement cost.

00:57:22.000 –> 00:57:26.000
Issue is in today’s market. What if you can’t.

00:57:26.000 –> 00:57:30.000
What if you can’t? Okay. So they’ve tried, you know, 5 different agents.

00:57:30.000 –> 00:57:33.000
They’ve they’ve been put into the market and.

00:57:33.000 –> 00:57:35.000
Nobody will.

00:57:35.000 –> 00:57:38.000
Nobody will bid.

00:57:38.000 –> 00:57:42.000
The the project, or or buying the project for insurance.

00:57:42.000 –> 00:57:45.000
It’s a problem, because.

00:57:45.000 –> 00:57:48.000
Because then you’ve got board members.

00:57:48.000 –> 00:57:51.000
That are afraid to serve.

00:57:51.000 –> 00:57:58.000
Because you’re like we’ll there’s no insurance. The the document was supposed to get insurance. We couldn’t get insurance. What do we do? What happens.

00:57:58.000 –> 00:58:01.000
That’s why I said we. We started talking to them about.

00:58:01.000 –> 00:58:03.000
Maybe it’s time to terminate your condominium.

00:58:03.000 –> 00:58:06.000
And and and sell the land.

00:58:06.000 –> 00:58:12.000
And the units to a developer to do something else with it. It’s.

00:58:12.000 –> 00:58:15.000
It’s a serious problem. And.

00:58:15.000 –> 00:58:19.000
And that particular association.

00:58:19.000 –> 00:58:21.000
The issue was caused.

00:58:21.000 –> 00:58:24.000
By failing to manage.

00:58:24.000 –> 00:58:29.000
Their building. Then, failing to manage their construction projects.

00:58:29.000 –> 00:58:33.000
Having significant claims, and then being unable to get.

00:58:33.000 –> 00:58:36.000
Insurance. It’s exactly what.

00:58:36.000 –> 00:58:46.000
You know, it’s exactly what we’re talking about, so we’re kind of nearing the end. And and I’ll just kind of go over.

00:58:46.000 –> 00:58:51.000
You know. What if the job, you know litigation concerns? You know the 1st thing.

00:58:51.000 –> 00:58:55.000
You’re gonna be looking for in your contracts. Have you provided for indemnity of defense?

00:58:55.000 –> 00:59:00.000
Do you have appropriate insurance? Can we notify the insurers? If there’s a claim.

00:59:00.000 –> 00:59:08.000
the the number. One piece of advice I can give you is if you start to sense a problem on your construction project.

00:59:08.000 –> 00:59:10.000
Involve.

00:59:10.000 –> 00:59:14.000
Involve the.

00:59:14.000 –> 00:59:16.000
Involve the professionals.

00:59:16.000 –> 00:59:20.000
You know. Get in terms.

00:59:20.000 –> 00:59:22.000
You know. Get with your attorney.

00:59:22.000 –> 00:59:24.000
Contract is not performing.

00:59:24.000 –> 00:59:27.000
And.

00:59:27.000 –> 00:59:34.000
You know. Wh. What about this concern in the contract? We’ve had this issue happen.

00:59:34.000 –> 00:59:37.000
So

00:59:37.000 –> 00:59:45.000
I think we got that done in just about an hour.

00:59:45.000 –> 00:59:46.000
Yeah.

00:59:46.000 –> 00:59:57.000
And and there was one question in the chat I mentioned about the snow removal landscaping. How do you know they’re insured for that? You asked for a copy of their policy, the exposure page, and it should show that they have snow removal, and they have a dollar value there, and so.

00:59:57.000 –> 01:00:01.000
It’s pretty. You just have to ask that question again as part of the vetting.

01:00:01.000 –> 01:00:06.000
And and and I think that’s where these vetting programs come in.

01:00:06.000 –> 01:00:12.000
And and I think that’s also, you know, one of the takeaways from today is.

01:00:12.000 –> 01:00:14.000
Involve your professionals.

01:00:14.000 –> 01:00:16.000
You know we’ve got a team here.

01:00:16.000 –> 01:00:22.000
Of, you know, very practices. We got legal. We got insurance. We got management.

01:00:22.000 –> 01:00:25.000
And and we all have to work with each other.

01:00:25.000 –> 01:00:32.000
On a regular basis. You know, in this, in in the Condominium world, in the Condominium industry.

01:00:32.000 –> 01:00:34.000
And if you have a question like that.

01:00:34.000 –> 01:00:41.000
You know. i i i think it’s it’s important to to involve the professionals.

01:00:41.000 –> 01:00:44.000
And especially when you’ve got the professional saying, Hey.

01:00:44.000 –> 01:00:46.000
You know. Use this.

01:00:46.000 –> 01:00:49.000
You know, use this.

01:00:49.000 –> 01:00:51.000
These programs.

01:00:51.000 –> 01:00:53.000
For vetting.

01:00:53.000 –> 01:00:56.000
With the new technology.

01:00:56.000 –> 01:00:59.000
You know, change the mindset. I I think.

01:00:59.000 –> 01:01:01.000
I I think it helps

01:01:01.000 –> 01:01:05.000
Nushik, I I saw one question on here.

01:01:05.000 –> 01:01:08.000
How do you deal with the Shadow Board Person.

01:01:08.000 –> 01:01:10.000
Who’s lobbying.

01:01:10.000 –> 01:01:16.000
For her candidate, the guy that she knows.

01:01:16.000 –> 01:01:18.000
Or he knows

01:01:18.000 –> 01:01:20.000
As a contractor.

01:01:20.000 –> 01:01:25.000
And the better candidate gets defeated.

01:01:25.000 –> 01:01:30.000
You know I I’m I’m assuming you’ve seen that.

01:01:30.000 –> 01:01:32.000
In the past.

01:01:32.000 –> 01:01:39.000
You know. And what do you do in a situation like that?

01:01:39.000 –> 01:01:48.000
I don’t know much about the particulars for this specific situation, but I you know we are big advocates of always trying to get our boards.

01:01:48.000 –> 01:01:54.000
To work again. I I don’t know the specifics of the situation, or why this particular board.

01:01:54.000 –> 01:01:58.000
Likes that particular service provider. I don’t know that.

01:01:58.000 –> 01:02:08.000
But you know it’s it’s up to us to educate our boards to make the best decision on behalf of the community that you know that’s their duty. That’s their job.

01:02:08.000 –> 01:02:13.000
And to be able to again have have good discussions about the various.

01:02:13.000 –> 01:02:15.000
Of vendors, and then make.

01:02:15.000 –> 01:02:18.000
A good decision about what the best.

01:02:18.000 –> 01:02:23.000
Vendor, or you know, whatever the situation is here for the community.

01:02:23.000 –> 01:02:33.000
It. It happens a lot. I think the boards have to stay. Look at the majority of the board, you know. That’s the will, you know, if they’re taking a vote and they’re voting.

01:02:33.000 –> 01:02:36.000
You know, for this specific vendor. Then.

01:02:36.000 –> 01:02:40.000
You know, everyone should respect that vote.

01:02:40.000 –> 01:02:49.000
But again, I think the robust discussion, and maybe having the other Board members really be fully honest with this particular Board member as to.

01:02:49.000 –> 01:02:55.000
You know what their concerns are, and really being able to have a good, honest discussion about it.

01:02:55.000 –> 01:02:57.000
Have you had any

01:02:57.000 –> 01:03:00.000
Scenarios, where.

01:03:00.000 –> 01:03:04.000
You know, one question came up. Look what if you don’t? I mean, I know that.

01:03:04.000 –> 01:03:06.000
Since the pandemic.

01:03:06.000 –> 01:03:10.000
Getting good vendors has been difficult.

01:03:10.000 –> 01:03:12.000
Have you had.

01:03:12.000 –> 01:03:20.000
Scenarios where you don’t have enough vendors responding to Rfps. And what do you do if that occurs.

01:03:20.000 –> 01:03:34.000
I think that was definitely an issue. Very much. Post Covid. I think we’re seeing that it’s improved a lot again, you know, having good relationships with your vendors is always, you know, best practices.

01:03:34.000 –> 01:03:46.000
Making sure that, you know we’re respecting them, making sure they’re being paid on time, making sure that you know everything that we’re doing to be their partner. Isn’t everyone’s best interest.

01:03:46.000 –> 01:03:49.000
And I think, just, you know, being really.

01:03:49.000 –> 01:03:55.000
You know, really proactive and and identifying, and having your management company.

01:03:55.000 –> 01:03:58.000
Help, identify, help you, identify.

01:03:58.000 –> 01:04:13.000
Good vendors that would for me. That would be part of their responsibility, and that that should be something that that’s a priority for them, if that’s the instruction that they’re getting from the board. But you know, do we always are we always able to get 3 bids for everything.

01:04:13.000 –> 01:04:29.000
You know, typically we try. But sometimes you have to, you know, if it’s a time sensitive thing, if you can get 2 really good bids. At least you have the Board be able to make it educated decision, based on 2 solid bids with 2 solid business partners.

01:04:29.000 –> 01:04:33.000
So I think you know the takeaways are.

01:04:33.000 –> 01:04:38.000
You know vet your contractors construction.

01:04:38.000 –> 01:04:40.000
Negotiate your contracts.

01:04:40.000 –> 01:04:46.000
Transfer and eliminate as much risk as you can transfer it to the contractor.

01:04:46.000 –> 01:04:49.000
Through indemnity, provisions.

01:04:49.000 –> 01:04:53.000
Make sure you’ve got appropriate insurance in case.

01:04:53.000 –> 01:04:56.000
One of the parade of happens.

01:04:56.000 –> 01:04:58.000
Then manage your project.

01:04:58.000 –> 01:05:00.000
Your contractors and.

01:05:00.000 –> 01:05:02.000
When you have, when you’re in doubt.

01:05:02.000 –> 01:05:07.000
You know, involve the professionals. i i i do think.

01:05:07.000 –> 01:05:11.000
Sometimes, you know, like, and and I see it.

01:05:11.000 –> 01:05:14.000
The it’s like, Oh, you know, we don’t want to deal with a lawyer.

01:05:14.000 –> 01:05:18.000
You know. You know this is only a couple of $100,000.

01:05:18.000 –> 01:05:23.000
You know he’s gonna he’s gonna delay. It’s gonna take him a while.

01:05:23.000 –> 01:05:26.000
Then there’s gonna be back and forth with their lawyer.

01:05:26.000 –> 01:05:29.000
Well, in in my view.

01:05:29.000 –> 01:05:34.000
You know it’s that’s a little bit shortsighted. Whether you’re involving me.

01:05:34.000 –> 01:05:37.000
Whether involving new sh whether involving Kevin.

01:05:37.000 –> 01:05:40.000
Because sometimes you spend.

01:05:40.000 –> 01:05:42.000
That time and effort.

01:05:42.000 –> 01:05:46.000
At the beginning, and you don’t have.

01:05:46.000 –> 01:05:51.000
A large expense or a catastrophic failure.

01:05:51.000 –> 01:05:54.000
At the end. You don’t wind up in.

01:05:54.000 –> 01:05:58.000
The the surplus market pool. You don’t wind up.

01:05:58.000 –> 01:06:00.000
Not being able to get insurance.

01:06:00.000 –> 01:06:06.000
You don’t wind up in litigation. Look, the last person really you want to see is me.

01:06:06.000 –> 01:06:10.000
Because you have like, I tell. I tell my clients.

01:06:10.000 –> 01:06:14.000
You’re gonna see me at the next 4 annual meetings to tell you what the update on the litigation is.

01:06:14.000 –> 01:06:17.000
And all the while.

01:06:17.000 –> 01:06:19.000
You’re gonna be paying me.

01:06:19.000 –> 01:06:22.000
To litigate the case, whereas, if we had.

01:06:22.000 –> 01:06:25.000
Properly transferred, the risk.

01:06:25.000 –> 01:06:29.000
And spent a couple of hours doing that.

01:06:29.000 –> 01:06:36.000
With the initial contract. We wouldn’t we wouldn’t we wouldn’t. You wouldn’t be seeing me for the next 4 years.

01:06:36.000 –> 01:06:41.000
Again. That’s that’s that’s really against my self interest.

01:06:41.000 –> 01:06:44.000
But that’s that’s the best way.

01:06:44.000 –> 01:06:51.000
To do it, you know. And and you know it’s it’s not just about changing the mindset, but it’s about.

01:06:51.000 –> 01:06:54.000
Like anything else. If you’re playing a football game, if you’re.

01:06:54.000 –> 01:06:58.000
You know, doing your job the best you can.

01:06:58.000 –> 01:07:01.000
You sort of try to prepare that.

01:07:01.000 –> 01:07:04.000
At the beginning, and.

01:07:04.000 –> 01:07:09.000
And then have a plan. And hopefully the outcome goes the way.

01:07:09.000 –> 01:07:11.000
You expect it, but if it doesn’t.

01:07:11.000 –> 01:07:14.000
You’ve protected yourself along the way.

01:07:14.000 –> 01:07:18.000
Kevin? Any last thoughts.

01:07:18.000 –> 01:07:26.000
No, I think we we covered an awful lot here. I guess it’s avoid self inflicted wounds by properly vetting your contractors.

01:07:26.000 –> 01:07:28.000
And no shake, any thoughts, any last thoughts.

01:07:28.000 –> 01:07:34.000
Just to your point, Ed. Rely on your business partners.

01:07:34.000 –> 01:07:41.000
To help you navigate through sometimes very difficult waters, but know that you know.

01:07:41.000 –> 01:07:44.000
All of us are always working in your best interest.

01:07:44.000 –> 01:07:49.000
Okay, so nobody. I haven’t seen anybody try to figure out what the little hidden theme was.

01:07:49.000 –> 01:07:52.000
Oh, they found that they found it out early on, I think.

01:07:52.000 –> 01:07:53.000
We got 2 2 in chat.

01:07:53.000 –> 01:07:55.000
1019 90.

01:07:55.000 –> 01:07:57.000
Oh, we do. I missed it.

01:07:57.000 –> 01:08:00.000
1019 jason.

01:08:00.000 –> 01:08:01.000
1019.

01:08:01.000 –> 01:08:06.000
The titles of the Slides, Songs, here song, Lyrics, Coldplay, and then.

01:08:06.000 –> 01:08:07.000
Wow! Excellent! I.

01:08:07.000 –> 01:08:09.000
Cara came in and said, It’s a scientist.

01:08:09.000 –> 01:08:11.000
Did I did

01:08:11.000 –> 01:08:21.000
Did I get the QA. Tiffany? Is there anything else that you think we need to address.

01:08:21.000 –> 01:08:28.000
I think the only one was a question from Paul about reserve studies. Did we touch on that.

01:08:28.000 –> 01:08:29.000
Okay.

01:08:29.000 –> 01:08:31.000
No, I don’t think so. Yeah, I think he wanted to know.

01:08:31.000 –> 01:08:33.000
And actually I saw another one.

01:08:33.000 –> 01:08:38.000
About.

01:08:38.000 –> 01:08:45.000
So so how often should you do a reserve study.

01:08:45.000 –> 01:08:49.000
I don’t know that there’s a specific.

01:08:49.000 –> 01:08:55.000
Legal timeframe for it. I know Fannie.

01:08:55.000 –> 01:08:57.000
Is

01:08:57.000 –> 01:09:00.000
Starting to contemplate.

01:09:00.000 –> 01:09:05.000
5 like like 10 years after the creation of the Condominium.

01:09:05.000 –> 01:09:09.000
And then updating it every 5 years thereafter.

01:09:09.000 –> 01:09:11.000
I think right now. That’s a little loose.

01:09:11.000 –> 01:09:17.000
Nushik, have you come across? Do? Do you have any specific.

01:09:17.000 –> 01:09:25.000
Advice on how often an association, you know it. It depends on the building, the building type.

01:09:25.000 –> 01:09:30.000
But do you have any? Do you have anything in terms of reserve study recommendations.

01:09:30.000 –> 01:09:35.000
Yeah. Ed, typically 5 years is sort of the.

01:09:35.000 –> 01:09:42.000
You know, unspoken rule again, I’m not a reserve specialist, but I think that’s what they would say. And again, sometimes.

01:09:42.000 –> 01:09:48.000
Depending on inflation and depending on. If things have changed in your building every 2 or 3 years.

01:09:48.000 –> 01:09:55.000
And then sort of redoing it, you know every or really looking at it seriously, at least every 5 years.

01:09:55.000 –> 01:09:58.000
Yeah, I think Fannie is starting to say.

01:09:58.000 –> 01:10:00.000
Within the 1st 10.

01:10:00.000 –> 01:10:04.000
And then every 5 years later, and I and I wouldn’t be surprised if that becomes.

01:10:04.000 –> 01:10:07.000
A hard and fast rule, as.

01:10:07.000 –> 01:10:10.000
As they continue to clamp down on the lending

01:10:10.000 –> 01:10:15.000
On the lending industry. I did see somebody.

01:10:15.000 –> 01:10:20.000
Ask a question about contracts using permit approvals to document completion points.

01:10:20.000 –> 01:10:26.000
I think sometimes you know you. You’re you’re construction contracts.

01:10:26.000 –> 01:10:29.000
Can document specific completion points.

01:10:29.000 –> 01:10:32.000
I I think the general rule.

01:10:32.000 –> 01:10:38.000
Is you know, percentages of completion.

01:10:38.000 –> 01:10:41.000
Or or specific tasks.

01:10:41.000 –> 01:10:47.000
Not so much permit approval, like, you know that, you know they finish the boiler room.

01:10:47.000 –> 01:10:52.000
Okay. The architect certifies that finish the boiler room. You’re entitled to 20% of the. They finished.

01:10:52.000 –> 01:10:55.000
The exterior cladding.

01:10:55.000 –> 01:11:02.000
Okay, you’re entitled to second 20. I I think it’s usually, or sometimes it’s just based on.

01:11:02.000 –> 01:11:07.000
Percentage value of the contract. The architect, as a way of breaking down.

01:11:07.000 –> 01:11:10.000
The let’s say the 20 million dollars over.

01:11:10.000 –> 01:11:13.000
The various tasks.

01:11:13.000 –> 01:11:19.000
In the contract, and they work out a methodology or system, at least in my experience.

01:11:19.000 –> 01:11:20.000
With the.

01:11:20.000 –> 01:11:25.000
And there there are a couple of questions in the QA. Who should be additionally insured when contractors are hot.

01:11:25.000 –> 01:11:27.000
Great great question.

01:11:27.000 –> 01:11:38.000
And and the answer is, your management requires the association to name them property managers additional insured. So when you enter into written contracts.

01:11:38.000 –> 01:11:46.000
Not only is the association should be named additional insure, but the management company should be as well.

01:11:46.000 –> 01:11:48.000
Okay.

01:11:48.000 –> 01:11:52.000
I I think I wanna I wanna thank everybody for.

01:11:52.000 –> 01:11:54.000
Joining us!

01:11:54.000 –> 01:11:57.000
And.

01:11:57.000 –> 01:12:00.000
I hope that you.

01:12:00.000 –> 01:12:02.000
Found this to be useful.

01:12:02.000 –> 01:12:09.000
And I I know one of the things that a lot of people ask in the chat.

01:12:09.000 –> 01:12:11.000
Is, can they get a copy of.

01:12:11.000 –> 01:12:13.000
The program.

01:12:13.000 –> 01:12:16.000
They actually can. If you email.

01:12:16.000 –> 01:12:18.000
Email, myself.

01:12:18.000 –> 01:12:21.000
Edit am condo law.

01:12:21.000 –> 01:12:23.000
We’ll be able to.

01:12:23.000 –> 01:12:27.000
Not only get you a copy of the program.

01:12:27.000 –> 01:12:31.000
But you can also have a copy of the Powerpoint.

01:12:31.000 –> 01:12:33.000
And I know Tiffany.

01:12:33.000 –> 01:12:36.000
Is going to be in contact with.

01:12:36.000 –> 01:12:40.000
The the winner of.

01:12:40.000 –> 01:12:43.000
Sort of our Easter egg hunt and.

01:12:43.000 –> 01:12:49.000
I don’t know. I’m kind of feeling like if we got 2 people that were really close in time.

01:12:49.000 –> 01:12:51.000
That maybe we should be giving out.

01:12:51.000 –> 01:12:56.000
A couple of Easter baskets. Not just one tiff, so.

01:12:56.000 –> 01:12:59.000
We can talk, we can talk about that. And.

01:12:59.000 –> 01:13:02.000
And tiff can reach out

01:13:02.000 –> 01:13:06.000
Thanks for having us folks. We really appreciate your time.

01:13:06.000 –> 01:13:08.000
Your attentiveness.

01:13:08.000 –> 01:13:13.000
And your participation on a somewhat dreary.

01:13:13.000 –> 01:13:18.000
Wednesday afternoon. And hopefully, we’ll see you around in future. Webinars.

01:13:18.000 –> 01:13:22.000
Or out and about, and hopefully, not.

01:13:22.000 –> 01:13:24.000
Not as part of any.

01:13:24.000 –> 01:13:26.000
Catastrophe.

01:13:26.000 –> 01:13:29.000
Yeah, have a great day.

01:13:29.000 –> 01:13:30.000
Thank you. Everyone.

01:13:30.000 –> 01:13:31.000
Hi! Everybody!

01:13:31.000 –> 01:13:32.000
Bye, bye.

01:13:32.000 –> 01:13:39.000
Thank you. Everyone.