Money makes the world go round. In a Condo Association, you want money. But money comes, primarily, from your Condo Association members. That means you! If you’ll recall from Finances 101, the primary method for increasing revenues is to raise assessments. While assessments are going to be the vast majority of your income, there are some things your Association can do to create alternate income to raise your condo association revenues. Your ability to take advantage of these will vary depending on your location, property, and size. Before we dive into that, let’s first cover a few philosophical fundamentals:
- Make sure you’re actually making money – look at the total cost of ownership for each enterprise. If you’re spending staff time on an endeavor, make sure you’re accounting for that to make sure the endeavor is worth it.
- All bids should be fair and open competition. Revenue streams are where you can run into conflicts of interest (real or perceived) – make sure you’re being transparent and acting with integrity.
- When appropriate, take Owner input into account. If you’re going to be impacting Owners’ quality of life, you should put things out for comment.
- You are an Association, not a business. Don’t sponsor every inch of your building mindlessly. Unless you really, really need the money.
Now then, on to the options!
Solar Panels – Solar Panels require a steep up-front expense to install, and it can take a decade or more to make back the initial investment depending on where you live. A number of companies like Solar City, SunRun, Sungevitiy, etc., have created a “third party ownership model” where the company installs the panels on your property, and then splits the income from the power generation of the panels with you. This will reduce your electricity bill, which is likely one of your greatest expenses. This makes the cost of ownership nearly nothing and creates immediate revenues for an Association. Revenue Potential: $$
Advertising – Depending on your location and local laws, you could make money from advertising. Whether it’s traditional billboards or electronic billboards, or a rotating display in your common areas, you can make a small amount of dollars. Revenue Potential: $
Renting Parking Spaces – Flush with parking spaces? In many buildings, these are a hot commodity. For whatever reason, your Association may have extras – and you could always rent those out to Owners. Do make sure you’re obeying your relevant Condo documents with the way you use your parking spots. Revenue Potential: $
Bike Shares and Car Shares – In many cities, bike share and car share programs are booming. You might look into hosting one or the other on your property in exchange for leasing fees or other revenue sharing agreements. Both of these are also a nice amenity to offer your Owners. Revenue Potential: $
Cell Phone Antenna Rental – Tall building with lots of roof space? You might consider leasing out cell phone antennas or other signal amplifiers. Make sure your lease includes utility reimbursement, which is a common concession. Revenue Potential: $$$
Maintenance Service Programs – Many Condos employ maintenance staff. Often there are a variety of maintenance tasks that Owners don’t want to do or don’t know how to do, like installing a new toilet flapper. You could create a program where you have maintenance perform the tasks for a fee. I recommend ensuring that such a program is used with surplus maintenance staff time – remember, their job is to maintain the building first and foremost. You also need to build a simple but reliable accounting system to ensure that an excessive amount of Management staff time isn’t spent on scheduling. That said, this is a great way to cover part of your maintenance staff’s salaries while also providing Owners a useful service. Investor owners who rent their units will also love this for their tenants. Revenue Potential: $$
Vending Machines – Ah, vending machines – the savior of the hungry, the thirsty, and the lazy. Sometimes all three. Do you know who owns your machines? Have they paid you lately? This industry is notorious for being flakey, so make sure you’re getting your share of profits or lease fees, and also getting reimbursed for utilities. You might also consider talking to Owners to see where their tastes run to maximize the profits and benefits of this amenity. Revenue Potential: $
Pursuing alternate revenue streams is well within a Board’s duties, and can not increase condo association revenues, but also provide useful amenities to Owners. Make sure you’re not leaving money on the table.