New Jersey will soon require condominium buildings to conduct more stringent structural inspections and perform more frequent reserve studies to ensure they have funds for structural maintenance and repairs.

The law takes effect in 2026, but the time to prepare for compliance is now, according to those familiar with the new mandates.

Senate Bill 2760 represents a major change for building owners who in the past may have only conducted cursory inspections of their structural integrity or may not have set aside adequate reserves to help pay for needed repairs that come to light during these inspections, said Jacqueline Kerstetter, a structural engineer and associate with structural and architectural engineering firm Klein & Hoffman.

Kerstetter, along with Caitlin Maggiano, an architectural/structural engineer and associate principal at Klein & Hoffman, spoke with Bisnow about what the new law requires and how condo buildings can begin to comply and give their residents peace of mind.

“This will require condo and co-op boards to perform preventative maintenance or repairs in the early stages of a problem with their building, before it progresses to an obvious issue, which is going to be an eye-opener for some buildings,” Kerstetter said. “This will set the bar higher than it ever was for buildings in the state.”

New Jersey is the second state to codify new inspection and reserve requirements, behind Florida, which was the site of a building collapse in 2021 that killed nearly 100 people.

“We will continue to do everything in our power to ensure that no New Jersey community has to endure the tragedy that befell Surfside, Florida, just a few years ago,” New Jersey Gov. Phil Murphy said when he signed the bill into law earlier this year. “Every New Jersey family … deserves to live with the peace of mind that comes with knowing your home will shelter and protect your loved ones against the elements and the test of time.”

“Owners should start planning now,” said Maggiano, who, like Kerstetter, is based in Philadelphia. “I recommend they hire a qualified licensed professional engineer experienced in the assessment of existing structures to help guide them through the steps of the new process.”

An initial structural inspection must be performed by a structural inspector or engineer within either 15 years of the date the building received a certificate of occupancy or 60 days after damage to the primary load-bearing system is observed, whichever is earlier.

The inspection focuses on the primary building structure, which includes load-bearing elements such as columns, beams and floors. And for the first time, balconies are now included on the list of load-bearing elements requiring inspection, Maggiano said.

Recurring inspections must be conducted every 10 years for buildings younger than 20 years old and every five years for buildings more than 20 years old. If deterioration or a structural deficiency is identified, the building must make the recommended repairs within the deadline set by the engineer. A follow-up inspection must then be performed 60 days after the repairs are complete.

Although condo boards might fret about the expense of complying with the new law, Kerstetter said compliance will likely reduce their maintenance and repair costs over the long run — not to mention prevent the potential for tragedies that cost lives.

“The intent of this bill is to reduce the probability of a building needing costly structural repairs that haven’t been budgeted for in reserve funding, resulting in a special assessment being required or deferment of the repairs,” she said. “What we saw many times after the collapse in Surfside was that all of a sudden, condo managers and residents understood the importance of a structural inspection. We performed a slew of inspections, and in some cases, we found issues that needed to be addressed that just weren't caught for a long time because they hadn’t had regular inspections.” 

The new law also requires condominiums to conduct a 30-year funding outlook to ensure they have adequate reserves to cover repairs, rather than the current required projection of only 20 years. In addition, a new reserve study or reserve study update must be performed every five years.

If the building’s last study was performed more than five years ago, the owner must complete a new one within one year. If a funding shortfall is identified in the reserves, the condominium association must increase dues immediately to cover the difference. If they find they need to raise dues by more than 10%, the state gives them 10 years to make up the funding deficiency.

“Often, associations get reports calling for million-dollar repair programs that they can't fund, and they panic because they are faced with the difficult task of notifying the residents and the pushback that often follows,” Maggiano said. “This law makes it such that they have to be proactive, and hopefully it reduces the potential for very expensive projects.”

New buildings under construction are impacted, too. Their plans must be reviewed by an engineer, followed by an inspection once the building is complete.

“As part of that initial review, they're requiring the developers to make a funding plan for the maintenance of the building’s primary structure,” Kerstetter said. “That's a lot more preemptive than some developers are used to.”

Maggiano said a condominium board or manager’s first step toward compliance is to determine where they fall in the state’s new inspection cadence based on the age of the building. The second is to contact a licensed structural engineer.

The engineer’s job will be helped greatly if the building has kept good records of previous inspections and repairs performed over the years. After all, Maggiano said, “An engineer’s assessment is typically limited to what is readily visible. The background information she is provided with can either provide a wealth of knowledge or no help at all.”

Kerstetter said a condo building should seek out a licensed engineer with experience in inspecting existing structures who knows how to spot “telltale signs” of structural deterioration. However, the primary responsibility still lies with the building to implement the recommendations.

“Property managers and boards are really the first line of defense for the building, although they don't always know what they should be looking for,” she said. “But now New Jersey is forcing people to get educated about it. We expect to see a lot more proactive maintenance being done throughout the state as a result.”

This article was produced in collaboration between Klein & Hoffman and Studio B. Bisnow news staff was not involved in the production of this content.

Studio B is Bisnow’s in-house content and design studio. To learn more about how Studio B can help your team, reach out to studio@bisnow.com.