In Multifamily we call them reserve studies, in Commercial we call them capital plans – they are both financial forecasts of anticipated repairs based on remaining component life and what it will cost to replace that component at that time. In English that means, are you saving the money to repair the things that will wear out? Using an example of a roof replacement, if you anticipate that you will need a new roof in 5 years and the roof will cost about $300,000 to replace, are you saving $60,000 per year to do that? Now how about the windows, cladding, furnaces, elevator, parking lot re-striping, carpeting, etc.?
Every component has a life span, remaining life, and a replacement cost. A comprehensive plan will help you save for all the necessary items and not be financially surprised when it’s time to repair it. Having financial reserves not only helps with your stress level, it usually means that your building is being repaired and maintained in systematic fashion, and those buildings look better and are worth more.
Our inspections and cost estimates will help you assemble a plan for replacement when needed. In addition, after significant repairs, many of these existing plans need to be updated to reflect the new components installed as a part of the repair process.