Reserve fund study

What is a reserve fund study?

A reserve fund study is a crucial document designed to ensure the longevity of condominiums. Its primary objective is to produce a detailed report on the condition of a building, including an estimate of the future repair and maintenance costs. This study, which must be conducted by certified professionals, should be updated every five years to maintain the health of your condominium reserve fund.

Why conduct a reserve fund study?

Since the enactment of certain provisions of Bill 16 on January 10, 2020, condominium syndicates are required to conduct reserve fund studies every five years. This legislation amends Article 1071 of the Quebec Civil Code by removing the requirement for a minimum contribution of 5% of the common expenses to the reserve fund. Now, the amount to be contributed for financing major repairs or replacements of common areas must be determined according to the recommendations of the contingency fund study.

This study, also known as an asset management plan, involves preparing a detailed report on the necessary repairs and anticipating those required to maintain the building’s physical and functional integrity in the long term. According to the new requirements, this study must be carried out by a recognized professional in this field.

The benefits of a contingency fund study:

• This study enables the determination of precise and equitable contributions to the condominium reserve fund.

• As necessary works are accounted for over the long term, property owners or condominium syndicates can spread costs over several years, thus avoiding unexpected and often heavy expenses.

• A contingency fund study ensures better preservation of the building, increasing its value and ensuring a high-quality living environment for its residents.
• Through better planning of interventions, work periods can be optimized to minimize inconvenience to residents and ensure efficient execution.
• By using professional services, errors can be avoided, and disagreements among co-owners can be minimized.

How is a reserve fund study conducted?

The study is conducted following an inspection of the building’s condition and common areas. According to the condominium charter, the building’s systems and common areas include facade inspections, windows, balconies, roofing, parking, as well as other common assets such as mechanical and electrical systems.

What is included in our reserve fund study?

Our study includes the following elements:

• A visual inspection of the building and common areas
• An estimation of costs associated with correcting observed deficiencies and maintenance works, including applicable timelines
• Inspection of systems with cost estimates for their replacement and their lifespan
• Analysis of the state of the reserve fund
• Recommendations for establishing a building maintenance program
• Proposal of contribution scenarios

Our reserve fund evaluations propose different scenarios tailored to the needs of condominium syndicates and building managers. If the study reveals that the fund is insufficient, according to Bill 16, an existing condominium syndicate has up to 10 years to inject additional amounts into its contingency fund to cover the deficit.

How much does a reserve fund study cost?

At Genispec, we guarantee competitive prices and quality service. Our certified engineers (OIQ) work efficiently and rigorously to ensure the smooth execution of your project. The cost of a reserve fund study can vary depending on several factors, including:

• The size and complexity of the building: The number of floors, units, and a shared garage will all affect the project’s difficulty, among other factors.
• The type of condominium: Whether the building is vertical, horizontal, industrial, or commercial.
• The age of the building: If the building is older and/or this is the first reserve fund study, a more in-depth inspection of its structural components and systems may be required.
• Execution deadlines: If the study needs to be conducted within a short timeframe, this could result in additional costs.

It is impossible to provide a rate without knowing the building, which is why Genispec offers a free quote. Contact us to find out the cost of a condo reserve fund study for your building.

Who can conduct a contingency fund study in Quebec?

In Quebec, a reserve fund study must be carried out by a building professional, such as an engineer, architect, or technologist. At Genispec, for example, our team is composed of building engineers who are members of the Ordre des ingénieurs du Québec (OIQ).

Our engineers possess the necessary qualifications to successfully conduct your contingency fund study, providing detailed information on major works to be carried out, associated costs, and appropriate financing strategies. This allows for proactive and effective resource management, ensuring the longevity and value of your building’s contingency fund.

Why is it necessary to conduct a reserve fund study every five years?

A reserve fund study offers a projection of future interventions over a period of at least 25 years, thus facilitating the proper management of the building by the syndicate and its responsibilities. As the building’s conditions and construction costs may change, it is common to update the study every 5 years. This ensures that the reserve fund study remains accurate and up-to-date.

Why choose Genispec for your reserve fund inspection?

Unlike other firms, Genispec is composed of building engineers, all members of the Ordre des ingénieurs du Québec (OIQ). Our engineers are qualified to answer your questions and assist you in inspecting your buildings, whether for a contingency fund study or a facade inspection.

We specialize in inspecting commercial and industrial buildings. We offer our services in the Greater Montreal area, including Hampstead, Saint-Laurent, Mont-Royal, Laval, Longueuil, Brossard, the West Island, Kirkland, and more. Contact us for any questions, to learn more about our range of inspection services, or to obtain a free quote for a building inspection.