Reserve Study Proposal Request

Sample Report

Sample Report
Sample Report
Park - Reserve Study

Our Specialties

A reserve study is a critical tool for an association to plan for future capital repair needs. Adequately funded capital reserves can improve the ability of an association to fulfill its maintenance obligations without the need for special assessments or loans.

We specialize in working with community associations and property owners in problem-solving, repair/maintenance planning, pre-purchase due diligence, and cost estimating. We work with hundreds of community associations each year, including large-scale property owner associations, high-rise condominium properties, townhome communities, commercial owner associations, and non-profit entities. Services include reserve studies, transition studies, construction administration consulting, stormwater pond inspections, and engineering consulting.

What is a Reserve Study?

Reserve Studies include an estimate of future capital expenses and a financial analysis of the community’s reserve fund.

Capital Expenses

Capital expenses are non-annual repairs that the community association is responsible for—examples:  Paving of private streets, townhome or condo roofing, and painting, site drainage improvements.  Capital expenses are NOT: annual budget items, landscaping, cleaning, utilities, fees, or repairs due to natural disasters or other events covered in an insurance policy.

The estimate includes a timeline of when the repairs will be required and how much the repairs will cost.   The timeline and cost estimates are derived from several sources:  historical information from our clients, our network of local contractors, our local experience in construction management, and RS Means Construction Cost Data.

Financial Analysis

The financial analysis of the community’s reserve fund will evaluate the current reserve account balance and contribution rate to determine if it adequately achieves the funding goal.  The analysis incorporates an estimate of inflation and returns on invested monies.  We use the Cash-Flow Method where contributions to the Reserve Fund offset variable capital expenditures.  We determine if the current funding meets a Baseline or Threshold Funding Goal and we provide recommended alternative funding strategies to achieve the funding goal.

How is a Reserve Study Completed?

Completing reserve studies involves several steps:

Step 1

Proposal, defining scope, association responsibilities, acceptance of proposal.

Step 2

Investigate historical information on previous capital expenses, current deficiencies.

Step 3

Determine current financials (reserve fund balance, contribution rate).

Step 4

Document review and research on age of infrastructure.

Step 5

On-Site inspection(s)

Step 6

Financial analysis

Step 7

Develop draft report including explanation of condition evaluation and financial analysis.

Step 8

Submit draft Report, financial analysis, photo log.

Step 9

Board meeting with open discussion on draft and recommended funding alternates.

Step 10

Issue final report for the reserve study.

Sample Report

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Spring Creek

Reserve Study Portfolio

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