Earlier in 2017, FirstService Residential assumed management of 225 Rector Place, a 289 unit, 24-story, luxury condo building located in the Battery Park City neighborhood of lower Manhattan. Soon after completing takeover, the residential management team engaged subject matter experts at FirstService Financial to help deliver additional value to the association. The goal was to allow the association’s money to work for itself, as there were significant reserve funds in the portfolio earning little to no interest income.
Always striving to deliver value in the cash management space, FirstService Financial proactively approached the Board with a plan to invest the reserves to maximize interest income while still covering all of the deposits with FDIC insurance (a requirement of management contract). FirstService designed a CD ladder from three months to 36 months based on the association’s capital plans and liquidity needs. They also incorporated a series of money market accounts that complemented the portfolio with liquidity and above-average interest rates (0.80% – 1.10%).
The result? Our client will earn an additional $69,000 per year while maintaining FDIC-insurance on every dollar within a reserve fund that exceeds $7,000,000. FirstService Financial handled all of the heavy lifting with account setups and facilitated the execution of the allocation, truly delivering once again on its mission to bring value to clients.