How robust is your reserve fund when it comes to unplanned expenses and capital improvements on your Chicago residential building? A reserve study can help you determine if the money set aside for the emergency repairs and capital improvements of your building is adequate or if it needs to be increased.
Your reserve fund, as you probably know, is the money that is set aside to pay for emergency maintenance and short and long-term capital improvements. As a general rule, it should be an amount worth about 10 percent of your normal yearly operating expenses. However, under certain conditions, you should have more than 10 percent in your reserve fund. This is especially true if you know that you will have to make some large equipment upgrades in the near future.
Reserve studies are designed to help you assess your current reserve funds against needed maintenance and anticipate capital repairs. In general, the study will include a physical analysis of all the property, equipment and other items in the public areas of your building. Included items might include your roof, floors, ceilings, electrical wiring, HVAC system and plumbing pipes and drain lines. The physical analysis will tell you how much life is left in all of your critical systems and give a time-frame for repair and replacement. The time-frame could be as long as 30 years in some instances.
The other part of the report is financial. It takes your current reserve fund and estimated annual contributions to determine if the fund is viable. If the physical part of the study indicates that you will need to make major repairs or replace large pieces of equipment, you may need to increase your reserve fund in order to ensure that you have the money available to pay for emergency repairs and handle your capital improvement projects.
Include a Pipe Assessment in Your Reserve Study
One item that often gets overlooked is the pipe assessment. Pipes are often buried behind walls where they remain out of sight and out of mind until they start leaking or burst or you experience a major sewer backup. To avoid these catastrophes, you should have a plumbing assessment performed at the same time as your reserve study.
Pipe assessments are very similar to reserve studies in that they evaluate all the plumbing pipes and drains in your building and tell you the amount of useful life left in your pipes. It also contains an estimate for replacing or restoring your plumbing pipes so that you can financially plan for the expense.
Pipe Assessments with Nu Flow
Our professional pipe liners can perform your building pipe assessment while you are having your reserve study completed so that you have all the information you need to financially plan for the future. A plumbing assessment involves inspecting all of your plumbing and drain lines with a video camera inspection. This allows up to view and record the current state of your pipes and any visible corrosion or cracks. Once the camera part of the inspection is completed, we will provide you with a comprehensive report of everything that was found during the inspection. If we can restore your pipe by lining them or coating them with epoxy, we will recommend a pipe lining restoration, which will increase the expected useful life of your pipes while eliminating the need to tear out large sections of drywall and flooring. At the end of the report, we will provide you with an estimate to line your pipes.
To learn more about how a pipe lining assessment can save you money in the long and short-term, call us at 815-790-9000.