Reserve Fund Studies.
A Reserve Fund Study is your condominium’s long-term financial plan. Required under Ontario’s Condominium Act, 1998, it answers two questions every board has to be able to defend: what major repairs will this building need over the next 30 years, and how much money should we set aside today to pay for them.
Reserve Fund Studies for Ontario Condominiums
Done well, a Reserve Fund Study protects unit owners from surprise special assessments, gives the board cover to make funding decisions with confidence, and identifies risks years before they become emergencies. Done poorly, with unrealistic inflation assumptions, vague replacement timelines or generic component lists, it becomes a document the board cannot actually use.
Trace Consulting Group has been preparing Reserve Fund Studies for Ontario condominium corporations since 2015. We work directly with boards and property managers, and we write reports built to be read.
Class 1, Class 2, and Class 3: which one does your condo need this cycle
The Condominium Act requires every condominium corporation in Ontario to complete a Reserve Fund Study within the first year of registration and to update it every three years after that, alternating between updates based on a site inspection and updates that are not.
Class 1: Comprehensive Study
Required within the first year of registration. It includes a full site visit, physical inspection of every major common element component, an owner survey where applicable, and a complete 30-year financial analysis. In practice, most corporations restart the cycle with a new comprehensive study every nine years, and we recommend it.
Class 2: Update with Site Visit
Completed three years after a Class 1. Includes a fresh site visit and updates to both the physical and financial analysis to reflect changes since the previous study.
Class 3: Update without Site Visit
Completed three years after a Class 2. A financial update based on prior reports, current cost data and board input, with no new site inspection required.
Within 120 days of receiving the final study, the board must issue a Notice of Future Funding (formerly Form 15) summarizing the study and the board’s proposed response, and within 15 days of approving the plan each unit owner must receive a written summary. We help boards prepare the Notice of Future Funding as part of every engagement.
What every Trace Consulting Group Reserve Fund Study includes:
- A physical analysis: every major common element component identified, with its current condition, expected remaining useful life and projected replacement cost.
- A financial analysis: a 30-year cash flow model showing reserve contributions, expenditures, interest income and ending balance for each year.
- Funding scenarios: a fully funded plan plus alternatives so the board can compare options.
Clear recommendations on inflation assumptions, contribution rates and the timing of major projects. - A board-ready presentation summarizing the report in plain language for owners.
- Support for the Notice of Future Funding and the owner communication that follows.
Our process, from kickoff to final report
- Initial meeting – With the board and property manager, to review the building’s history, recent projects and known concerns.
- Document review – Drawings, prior studies, maintenance records and service contracts.
- Site visit – Common elements, mechanical and electrical rooms, the parking garage and the building envelope.
- Cost validation – Component costs checked against current Ontario construction pricing and our active project data.
- Draft and review- Draft report plus a board meeting to walk through findings and answer questions.
- Final report – Notice of Future Funding support and follow-up Q&A for owner meetings.
Why boards choose Trace Consulting Group
We are a multi-disciplinary engineering firm: mechanical, electrical, building science and fire protection, not a reserve-fund-only shop. The engineer estimating your boiler replacement is a P.Eng. with active retrofit experience, not a generalist citing manuals.
We use inflation assumptions grounded in current Ontario construction costs rather than the historic averages many studies still default to, and we write reports designed to be read and understood by your owners, not just filed with the Condominium Authority.
Sam Soltani, P.Eng., C.Eng., LEED AP, the firm’s founder, serves on the Board of Directors of CAI Canada. Sarah Hinchcliffe, P.Eng., Associate Director, leads condition assessments and capital planning across high-rise, low-rise and townhouse condominiums.
Trace Consulting Group is authorized by Professional Engineers Ontario, licensed in British Columbia, Alberta, Quebec, Nova Scotia, and Newfoundland and Labrador, and carries full professional liability insurance on every engagement.
Talk to an engineer
No-obligation conversation about your building, your timing and your budget.
Frequently Asked Questions
How often is a Reserve Fund Study required in Ontario?
Every three years. The Ontario Condominium Act, 1998 requires every condominium corporation to complete an initial Reserve Fund Study within the first year of registration and to update it on a fixed three-year cycle after that, alternating between updates with and without a site inspection.
What is the difference between a Class 1, Class 2, and Class 3 Reserve Fund Study?
A Class 1 is a comprehensive study with a full site visit and complete physical and financial analysis, required within the first year of registration. A Class 2 is an update three years later that includes a fresh site visit. A Class 3 is an update three years after that which relies on prior reports, current cost data and board input, with no new site inspection. In practice most corporations restart the cycle with a new comprehensive study every nine years.
Who is qualified to conduct a Reserve Fund Study in Ontario?
Under the Condominium Act, a Reserve Fund Study must be prepared by a member of a prescribed class of persons, most commonly a Professional Engineer or a licensed architect with relevant building experience. At Trace Consulting Group, every study is signed by a P.Eng. with active condominium experience.
How long does a Reserve Fund Study take?
A Class 1 study typically takes six to ten weeks from kickoff to final report, depending on building size, document availability and the board’s review timeline. Class 2 updates run four to six weeks and Class 3 updates three to four weeks. Timelines can be compressed where a registration milestone is in play.
What inflation assumption should our condo use?
Many older studies default to two percent, an assumption that has not matched real construction cost inflation in Ontario for some time. Our approach is a forward-looking rate grounded in current construction cost data, tested against alternative scenarios so the board understands the sensitivity, with the reasoning documented in every report.
What is a Notice of Future Funding and when is it required?
A Notice of Future Funding, formerly Form 15, is a document the board must issue within 120 days of receiving the final Reserve Fund Study. It summarizes the study’s findings, the board’s proposed funding plan, and any differences between the two. Within 15 days of approving the plan, the board must send each unit owner a summary. We help boards prepare the Notice as part of every engagement.
Can a Reserve Fund Study recommend special assessments?
A study can model funding scenarios that include special assessments, but most boards prefer scenarios that avoid them through gradual contribution increases. The study itself does not impose a special assessment; that decision belongs to the board. When a special assessment is the realistic path, we help the board structure the timing and the owner communication around it.