 |
|||||||||
 |
 |
COMMUNITY ASSOCIATIONSERVICES
A
Physical Needs Assessment (PNA) is best described as a pre-purchase
inspection of a multi-family residence or Community Association
Facility.
Similar to a single-family residential pre-purchase inspection, the PNA
identifies the repairs, replacements, and significant maintenance
items that will require attention over the term of the
mortgage.
Most
often, the PNA will also require an estimate of the costs to implement the
recommended repairs or replacements. It may therefore also be
referred to as a Preservation Capital Needs Assessment or simply a Capital
Needs Assessment.
A
Capital Reserve Study is a variation of the PNA. In a Capital Reserve
Study, an engineer evaluates the current condition, remaining useful
life
of the covered building components, maintenance requirements, and
estimated cost of maintenance and repair. However, an additional
calculation
is made to determine how much money must be set aside, on a regular basis,
to fund repairs when required. In other words, how much
capital, or money, should an association reserve, or put aside, to
maintain itself over a period of years. Typically, a twenty-year time
frame
is used, although it can be shorter or longer. There are generally two
types of reserves maintained by associations.
Contingency,
or Maintenance, Reserves are intended to be used for operating expenses
during a twelve-month period (e.g. utility costs, sewer cleanouts,
pest control, etc.). Capital Reserves are for project repairs and
replacements. Items such as regular periodic repairs (e.g. painting),
irregular
periodic repairs (e.g. deck surfacing), foreseeable failure, catastrophic
failure, and outdated design/aesthetics may be included in a Capital
Reserve Budget.
A
Transition Study is defined as an evaluation of the condition of the
property at the time the Board or Management Company takes it over from
the Developer.
Typically, one is
concerned with whether all elements are complete, if construction was
completed in compliance with plans and specifications, appropriate
approvals were obtained, and that there are no construction defects or
developing concerns.
|
|
| |||||
         |
|||||||||
  |
|||||||||
|
|||||||||
Affiliated with Criterium Engineers Building Inspection Experts since 1957