Once the administrator has assumed the position, he assumes all the
powers of the board of directors. Equally important is that the owners,
unless they make a successful application to the courts, cannot remove
the administrator so he has all the power he needs to make the
difficult but unpopular decisions that are required to restore the
condo corporation back to financial health.
The most pressing need is to put the corporation's financial affairs in
order. The units that are in arrears are given notice to pay up or a
lien will be put on their units and, if necessary, sold by a power of
Common element fees are normally increased to eliminate the operating
deficit and a special assessment is raised to generated needed funds.
If a very large amount of money needs to be raised, the administrator
may ask the owners to approve a borrowing by-law.
If there are open city work orders demanding repairs to the property,
the administrator will work out a plan with the city to bring the
property up to city standards.
Owners will get
An administrator's job is not a pleasant one.
Some owners will lose their units as they will not be able to pay their
arrears nor will they be able to pay the new higher
fees and the special assessments or loan payments that the
administrator requires. That is
but "free loaders" and low-income owners keeping the fees too low for
far too long may have been a major reason that the corporation
got itself into such a mess.
How many owners will lose their homes? In the lower-priced condos as
many as one-third. Sometimes more. It depends on how bad the financial
how expensive major repairs are required and how long the administrator
remains in charge.
In the short term, power of sales will hurt all of the owners as
property values will fall. How much? Units have dropped to as little as
a third of their previous value. Owners will find it hard to sell.
However, once the power of sale units have
been sold and the huge assessments and loans are paid off, property
values can recover.
If the administrator was requested by a group of owners, it is common
for the administrator to replace the property management company as
they were too close to the displaced board and the corporation needs a
Some of the contractors may also be replaced as the administrator looks
for competent suppliers at reasonable rates. Some employees may lose
their jobs if the administrator finds their performance wanting.
Being an administrator is not a fun job.
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