Every community faces major construction sooner or later. Roofs are replaced, buildings are painted and waterproofed, concrete and balconies are restored, and roads are repaved. These projects are often the largest expenses an association ever takes on. Careful planning protects the budget, the property, and the owners.
This article is general information and is not legal advice. The association's attorney should be consulted.
Start With a Plan
Before any contractor is called, the board should answer a few basic questions:
- What is the problem, and where exactly is it?
- Who is responsible for that component under the governing documents, the association or the owner?
- What is the right long-term solution, not just the cheapest repair?
- When should the work begin, considering weather, the hurricane season, and the effect on residents?
For technical work, an independent engineer or architect is often retained to investigate the condition, recommend a solution, and prepare plans and specifications. A clear written scope allows contractors to bid on the same work and makes their prices easier to compare. Condominium boards should also confirm whether the project is a material alteration of the common elements, which may require owner approval under the declaration or section 718.113 of the Florida Statutes.
The Risks of Poor Planning
Projects that start without a defined scope tend to suffer from the same problems:
- Budget overruns and unplanned special assessments
- Long closures of pools, parking areas, or other common areas
- Repairs that fail and have to be redone
- Disputes with contractors over what was included in the price
Reserve funds set aside for the component should be reviewed early. If reserves are short, the board will need to decide how the balance will be paid before contracts are signed. More on this is covered in
consequences of not having cash reserves.
Bidding and Contracts
Florida law requires most association contracts for materials, equipment, and services to be in writing. Competitive bids must be obtained when a contract exceeds a set percentage of the association's total annual budget, including reserves. Under section 720.3055 the threshold for homeowners associations is 10 percent, and under section 718.3026 it is 5 percent for condominium associations. The association is not required to accept the lowest bid.
When contractors are evaluated, the board should look for:
- Proper licensing and insurance, verified with the issuing agency and insurer
- Experience with similar residential projects
- References from other associations
- Independence from any director, with any conflict of interest disclosed as Florida law requires
The contract itself should be reviewed by the association's attorney. It should address the scope of work, schedule, change orders, warranties, insurance, permits, cleanup, and how disputes will be handled.
Payments and Lien Releases
A payment schedule should be agreed on before work begins. Payments are usually made in stages as work is completed and verified, often monthly on large projects. Many contracts hold back a portion of each payment, known as retainage, until the project is finished and accepted. The amount and release terms are set by the contract.
Under Florida's construction lien law, unpaid subcontractors and suppliers may be able to place a lien on the property even when the association has paid the general contractor. For that reason, each payment request should be supported by lien waivers or releases from the contractor and from the subcontractors and suppliers who have provided notice. The association's attorney can advise on the forms and timing.
Once a payment request is complete and the work has been verified, payment should be made promptly. Late payments can slow the work, raise costs, and damage the working relationship.
Managing Changes and Communication
Weather, schedule changes, and change orders are part of every large project. Each change order should be in writing, priced, and approved before the work is done. A regular reporting rhythm keeps everyone informed:
- Daily. A single board liaison or the manager is available to the contractor's superintendent for questions.
- Weekly. The engineer or construction manager and the contractor review progress, upcoming work, and any changes.
- Monthly. The board receives a written report on progress, payments, schedule, and change orders at a noticed meeting.
Owners should also receive regular updates about access, parking, noise, and closures.
Closing Out the Project
At the end, a final walk-through should be completed with the engineer, and a punch list of remaining items should be prepared. Final payment and retainage should be released only after the punch list is complete, final lien releases are collected, permits are closed, and warranties and as-built documents are delivered to the association's records.
Help With Your Next Project
Bid coordination, contractor communication, and project tracking are handled for the communities managed by Condominium Associates, working alongside the association's engineers and attorney. The role of facilities staff on larger properties is described in
facilities manager: what they do and why they matter. To talk about an upcoming project,
contact us or
request a proposal.
