With roughly 72 million square feet of managed property valued at more than $800 million between them, two Ottawa condo management firms are joining forces in preparation for impending changes in the market.
Capital Concierge and Integral Property Management are merging to become Capital Integral Property Management, the two firms announced Thursday. Capital’s Dan Fried and Integral’s Yawar Khan will serve as co-owners of the new firm, which will retain all 24 members of the two companies’ staff.
Mr. Khan says the merger was necessitated by a number of changes in the local condo market, specifically the introduction of a new Condominium Management Services Act from the Ontario government.
Reports say the new law will require condo managers and management providers to hold a license, and Mr. Khan says the changes will require an increased professionalization of services. Combining the two firms’ resources, he adds, will allow them to deliver on those expectations.
“Both Dan and I saw this coming. We both realized we had to change how we do business in order to really be competitive,” he says.
Reducing condo owners’ ‘horror stories’
The new firm’s portfolio, which includes buildings such as 90 George St. in the ByWard Market and the Minto Metropole in Westboro, is divided roughly 50-50 between Capital and Integral’s properties. Mr. Fried says he and Mr. Yawar initially got to know each other in “friendly competition,” but saw an opportunity to grab an edge in the Ottawa market.
Mr. Khan says his sector is currently dominated by small mom-and-pop shops and a few larger firms. Anticipating that Ontario’s new condo act will require systems that can readily connect condo boards to owners and management service providers, Mr. Fried says Capital Integral is highlighting a technological approach to its services. Mr. Fried gives examples of SMS notification systems and platforms that enable online accessibility of financial documents as ways the company is leveraging tech “in an industry that is historically and typically pen and paper.”
Capital Integral tends to sign annual agreements with condo corporations, but bills hourly for any services such as extended maintenance that fall outside of the contract. Mr. Fried says the firm finds much of its work through word-of-mouth, but also works closely with developers that are on the ground floor of a new build. He plans to establish a developers’ department at Capital Integral to entrench this approach, adding that as a property management firm, the company has an expertise in moderating issues between owners, boards and developers.
“I still haven’t met a purchaser that loves their developer,” Mr. Friend says with a laugh. Mr. Khan adds that the company’s goal is to reduce the “horror stories” often read about in the media such as condo owners forced to take legal action against boards.
Though both owners are excited about Capital Integral’s potential, their short-term enthusiasm for Ottawa’s condo market is much more muted. Mr. Khan believes there’s an oversupply in the city contributing to a “downward swing” in the market.
Both he and Mr. Fried believe that won’t last long, however. Mr. Khan says condos are often the entry point into the housing market for first-time buyers, and points the City of Ottawa’s attitudes towards intensification as indicators that the local condo market is set up for future success.
“Longer term, both Dan and I see the condo market increasing significantly,” he says. “I’m very confident that’s going to change.”
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This article originally appeared in the Ottawa Business Journal.