Exterior insulation and finishing system (EIFS) has been a subject of debate over the years. EIFS is “a class of non-load bearing building cladding systems that provides exterior walls with an insulated, water-resistant, finished surface in an integrated composite material system.”¹ So, an exterior with a very similar appearance to stucco (for which it is often mistaken).
EIFS exteriors can be controversial and have a bad rep due to improper installations. The problem lies with the waterproof quality of EIFS. Water can get behind exterior walls and it needs an escape route. EIFS does not allow water to evaporate back out of the building like other types of siding.
Before 1996, EIFS boards were nailed or glued to the building, without any secondary waterproofing. This was allowed because the caulking and acrylic waterproof covering were supposed to protect the building. However, whenever flashing was missing, caulking failed, or window seals leaked, water would enter in behind the envelope and never leave. This trapped water caused rotting wood and all sorts of problems… and lawsuits.
The EIFS industry and regulators resolved to add a drainage system behind all EIFS installations in 1996. These were the responsibility of the manufacturer to enforce among installers. So, is the problem fixed? Only time will tell but preliminary reports are looking good so far.
Carefully observe what is happening at your condominium and ensure it has routine inspections. This is true regardless of which siding or features your building has installed.
For even more information, Construction Canada did an interesting article this month on energy efficient building with EIFS.
1https://en.wikipedia.org/wiki/Exterior_insulation_finishing_system (as of Jan 21, 2016)