P.L. from Connecticut writes:
Dear Mister Condo,
I own 40 out of 68 units at my condominium association. There are 7 buildings with each building having a vote. I own 4 buildings completely and 2 units in another building of 10 condos. We’d like to self-manage. Do I need certifications? Do I need majority vote OK from the others before I cancel the existing management company? Do I need legal docs submitted somewhere telling CT this is what we are doing?
Mister Condo replies:
P.L., with such a substantial investment in play, you may wish to consult with an attorney before you make any missteps. My biggest concern is what do the condo’s governing documents have to say about the buildings. The way you describe each building having a vote, I am led to believe each building is a sub-association of a Master Association. If so, you need to follow the rules of the building’s association as well as the Master Association. Obviously, you control all of the votes of the 4 buildings you own completely. The other three buildings are up for grabs as far as whether or not they will vote with you. Depending on what percentage of votes you need to proceed, you may already have the votes to self-manage. Keep in mind that if there is a contract already in place with a management company, you are bound by that contract. Terminating the contract early can have expensive financial consequences for the association so make sure you know what you are getting into before you simply vote to remove the management company. There are many hybrid models for self-management. If the association will truly self-manage and have volunteer leaders (Board Members) run the association, then no license may be needed. However, if the association is going to place someone in the role as manager, that person would need to be licensed. Even if the association decides to self-manage on its own, it isn’t a bad idea for one or more Board members to get manager training. It’s not as easy as it sounds and there can be great risk to the association’s assets (money in the bank, for instance) if it is handled by someone who isn’t licensed. The state of Connecticut may not particularly care that your association is self-managed or not but you do want to make sure you keep all of your annual filings up to date and that you know who is the association’s Registered Agent. The Registered Agent is the recipient of many tax and legal papers. You wouldn’t want to miss important notifications because the Registered Agent was a former Property Manager with no current affiliation with the association. Other than those considerations, I think you’ll be fine. All the best!
If you own 48 out of 60 units in a condo you should very easily be able to “stack” the board with people who will vote as you would have them. You may even be able to put non-residents on the board depending on your documents. So you really don’t have any problems with control. Once you have control notice a meeting as per the states statutes (Connecticut Condominium Act Chapter 825). You can do as you please within the boundries of the law. You most certainly vote to take the association self-managed. I suggest that you do engage an attorney to be sure every thing is in good order.
There is no requirement that a community or condo association manager in Connecticut hold a real estate broker’s license. However, community association managers must register with the state. Therefore, if you want to manage the condo yourself I suggest that you read up, register, and get ready for the difficult task.
I also suggest that you purchase a good software platform that specializes in what tasks you may have ahead of you. Do yourself a favor and don’t run your condo on Quickbooks (no disrespect to Quickbooks but for condominiums you need a specialized package). Try to get some of the owners to be on the board so that the membership does not feel that they are living under a dictatorship. However with a 68% stake it will be yours to do with. Good luck
More and more associations are going self management.