We know how important it is for you to keep assessment costs down while budgeting to maintain and improve the quality and value of your property. That’s why our staff scrutinizes each association’s operations to find potential savings.
At every property, we use our experience and leverage with vendors to help you secure the best rates possible. We have helped associations negotiate contracts, reduce energy bills for gas, electric and water usage, and lowered or eliminated expenses for phone, scavenger and even staffing.
In some instances, we have also found opportunities to bring in more revenue through enhanced amenities, fees for usage and licensing charges. These revenue streams can help prevent special assessments and finance important improvements. The following success stories show many ways that we have gone beyond simply executing a budget and have partnered with boards to improve their bottom line.
New phone service cuts bills by 49%
Though many consumers have given up landlines in favor of only mobile phones, most associations have at least a few hard-wired phones on premises. Offices, clubhouses and elevators usually have a phone, and those costs can add up. LMS recently set up a service contract with 27 properties, finding a lower-cost phone service provider than they were currently using. This bulk pricing with Illinois Telephone Company has cut the Associations’ utility bills in half, for an annual savings of $155,000.
A savings of $43,000 on water costs.
LMS recently contracted with a company that can reduce water expense. This company has created a device that reduces the volume of water that is registered by the water meter by compressing the oxygen in the water. LMS was able to secure this device to be used for the first time on a condominium building in the Chicagoland region. To accurately measure the water savings, the utility company placed a meter before their device and a meter after their device. The results were amazing – the device saved the association $43,000.
Scavenger savings of $95,802 leads to no annual assessment increase.
At one property, an argument was made to the Village that scavenger fees should be at their expense, since the property has curbside pick-up and was being charged for it on their tax bill. After working with the Director of Public Works, we saved the association $95,802 on scavenger expenses leading to no increase in the following year’s assessments.
Attorney retainer recommendation saves $2,600-$6,600 per month.
After reviewing an association’s legal expenses, LMS noticed that the association was spending anywhere from $3,000-$7,000 per month on legal issues (not including homeowner collection matters) by paying their attorney by the hour. We introduced the board to an attorney’s Retainer Contract, and as a result, their retainer services were capped at $400 per month.
Energy buying program saves Associations $175,000 annually
LMS and Nania Energy Inc. worked to bring an electrical program to LMS Associations. It provided LMS’s small usage associations the pricing of large usage associations and thus saved them substantial dollars. Ultimately, a group of 16 property associations joined the program, and when the transaction completed, the final energy expense was 9% lower than anticipated. This pricing resulted in a $175,000 annual savings to our associations. These properties will enjoy this locked-in usage rate through the end of 2017.
Eliminating paint and wood projects saves $75,000.
At one property, we examined recurring major projects to see if long-term solutions could reduce or eliminate the recurring need. This property was on a three-year wood replacement and painting cycle that cost the association upwards of $20,000 every two to three years. Instead of continuing to have this work performed cycle after cycle, we suggested wrapping every piece of wood trim, window frame and balcony support beam in aluminum. This project cost $125,000 to complete, and virtually eliminated the need to paint or replace wood on the property for at least 30 years which saves the association $75,000 long-term.
“Fee for usage” revenue stream
An association in Chicago’s Loop had a high population of local commuters and dog-lovers, and their rules and regulations specified annual fees for dog ownership and bike storage. When LMS took over the property from the previous management company, we implemented an audit of bike and dog owners to be sure we were collecting all necessary fees. The audit uncovered dog and bike owners the previous company hadn’t identified, and showed that the total fees due to the association was $9,200 per year. This is welcome source of income to the association.
Generating income through clubhouse improvements
One property had a clubhouse that had a lot of potential, but did not get much use. We suggested simply updating the floors (hardwood, ceramic tile), bathrooms and window treatments, and changing the paint colors to attract more rental interest from homeowners. The clubhouse is currently booked solid almost every month, adding to the association income.
In January of 2015, we introduced the LMS Rental Program as a way to remove hours of rental property administration work from our property managers and allow them to focus their time on important association issues. Our Rental Program specialist handles all correspondence to owners, the collection and tracking of leases and other required documents, and processing fines for non-compliance. In the short time the program has been in existence, we have enrolled over 30 associations, informed property managers of the number of undocumented renters at their properties that could violate their rental caps and brought in over $150,000.00 in revenue for the associations from fees and violation fines.
Changing the status quo
Our LMS managers and accountants are never satisfied with “status quo”, and as a homeowner or board member, you probably aren’t satisfied with that either. We continually look for ways to improve the value of your buildings and strengthen your association’s finances, and bring our ideas to your board. That’s why our motto is “Enhancing environments, improving lives.”