New York's Cooperative and Condominium Community

Habitat Magazine Business of Management 2021



The Agony and the Ecstasy

She rose from the sands of long island during the Roaring Twenties, a grande dame known as the Pink Lady because of the salmon-colored paint that once adorned her stucco skin. But in recent years, after converting from a hotel to condos and becoming Lido Beach Towers, she began to show her age. Her pink skin had faded to a dull gray. She was leaking and rotting. This seaside dowager began to resemble – as one politician has said about the French – “an aging movie actress in the 1940s who is still trying to dine out on her looks but doesn’t have the face for it.”

All that is changing now. Lido Beach Towers – a majestic six-story, 184-unit, X-shaped landmark – is getting much more than an overdue face-lift. She’s getting a $15-million full-body makeover, from her twin Moorish cupolas to her rooftops, exterior walls, balconies, windows, and doors, all the way down to her drainage system.

When completed next year, this massive renovation will stand as the definitive answer to a question that vexes every condo and co-op board faced with major repairs: should we do it on the cheap, or should we do it up right?

Despite the dizzying spiral of the job’s cost, the board at Lido Beach Towers finally decided to do it right so they wouldn’t have to keep coming back later to make costly patchwork repairs. In the end it may be a prescription for ecstasy. But first the board had to go through its share of agony.


The Agony

The agony began not long after the Pink Lady ended her run as an opulent 300-room hotel. In her glory days, there were indoor and outdoor pools, a golf course, beach cabanas, and crowds that dressed to impress. The hotel restaurant had a retractable roof that permitted dining under the stars. There were stars in the circular nightclub, too, including Sammy Davis Jr. and Barbra Streisand. Barbara Walters used to spend her summers there.

But after the conversion to condos in 1981, residents added balconies and punched holes in exterior stucco walls to accommodate air-conditioners. This, predictably, led to leaks and maintenance problems, which were addressed in a piecemeal fashion.

“We had an enormous number of leaks,” says Shari Morse, who started working as a concierge in 1999 and is now the general manager, working for Kaled Management. “For years, the board’s response was to patch, patch, patch. That’s all they did. You fixed a leak in area A and diverted it to area B. They didn’t want to spend the money, but there comes a time when you can’t do that anymore.”

That time finally came in January of 2005, when the board hired an architect and engineer to do a thorough evaluation of the property’s needs. The top priority was the building’s most distinctive feature, which was on the brink of collapse: the twin Moorish cupolas on the roof.

“That job gave us the initial understanding of the level of deterioration,” says Anthony Colao, president of Flag Waterproofing & Restoration, the contractor. “Entire sections of structural steel were rusted right through. It was dangerous.”

The job wound up costing $700,000 – more than three times what an earlier board had allotted for the work – but it was merely the tip of the iceberg. The architect and engineer also proposed spending $2.7 million to repair the roofs and exterior walls. Though the board had no way of knowing it at the time, the figure would turn out to be much too low.

“We had 50 or 60 leaks, so it was almost a no-brainer to say we needed to do some serious rehabilitation,” says Parish Merriweather, an architect who was then president of the condo’s board. “I was the one who spearheaded the restoration. It was an unpopular thing at the time.”

It would get far more unpopular. As soon as the board approved the project, problems began to surface.

“When I signed on for $2.7 million, I thought that was a reasonable approach,” says Joanne Belli, a retired schoolteacher who has served on the board for the past 10 years and is currently its vice president. “But when they started trying to repair the terracotta [walls], it was so much more work than they’d expected. It became apparent that this type of repair was counterproductive.”

When the contractor drilled a dozen probes into exterior walls to examine the building’s infrastructure, he discovered that a decorative coating had been laid over the original stucco walls. He also found that the walls were leaking.

The architect proposed adding a weather-resistant coating to the building’s exterior, which would push the cost of the project up to $4 million. One board member likened this to “putting a band-aid on cancer.”

A new architect was brought in. He proposed covering the building’s exterior with a new Exterior Insulating Finishing System (EIFS) and also replacing the roofs, windows, doors, and terraces. The cost doubled again, this time to $8.5 million.

“I voted in favor of the $8.5 million,” says Merriweather, “but I went on record saying this was not going to be enough. We had to convince people that we had to do a complete job.”

It was a tough sell. Informational meetings were held night and day to educate unit-owners about the growing complexity and cost of the job. In May 2006, the $8.5 million proposal was put to a vote of all unit-owners. After rancorous debate, it passed.

“I did not vote in favor of the $8.5 million,” says Belli. “I felt more things needed to be ironed out, but there was a tremendous push to go forward.”


A Crash and a Crisis

Then, by way of throwing a little salt into existing wounds, one of the building’s four external emergency stairwells collapsed, thanks to shoddy construction and worse maintenance. Repairing all four stairwells, which were built after the condo conversion in the 1980s, boosted the price tag by an additional $500,000.

Meanwhile, the contractor kept finding unsettling details in the second architect’s design work. In late 2006, the board hired the engineer Jordan Ruzz to do a peer review of the architect’s plans.

Work essentially stopped while the re-evaluation took place. Ruzz came up with a new design that included a much more elaborate – and much more expensive – system for mounting the EIFS, as well as re-engineering and replacing all the balconies

“I took a lot of elements of what the other architect had intended, but I implemented them in a way that would work,” says Ruzz.

The cost of doing the job right was an eye-popping $13.5 million. Realizing there would be additional expenses, such as maintenance of the neglected storm drainage system, the board swallowed hard and passed another assessment to cover the expected $15 million price tag.

“The thing people were most unhappy about was that they kept getting unexpected expenses – from $2.7 million to $15 million,” says Gary Weiss, the current president of the board. “Because of the size and age of the building and its location and because of the number of years it was neglected, it was not business as usual. I had to meet with the unit-owners and tell them we thought there was going to be another assessment.”

Rather than taking out a bank loan or a new mortgage, the board decided to cover the additional expense by levying another assessment, payable in three installments in March, June, and November of this year.

“It caused a lot of dissension because of the way the job grew,” says Belli, the current vice president. “This has been very difficult financially. No one realized it would become a $15 million project.”

Merriweather, while serving as president, was putting in 30 hours a week trying to convince his neighbors that spending the money was the right thing to do. “It was the toughest situation I’ve ever been in,” he says. “As a result, I wasn’t re-elected to the board in 2006. It’s the same in any political situation. People don’t like to spend money.”


The Ecstasy

“This is not a typical New York City job,” says Joe Humann, the project manager with Flag Waterproofing & Restoration. “For starters, there’s the construction itself – a poured-concrete frame with terra-cotta block walls and a stucco exterior. Another unique factor is that it’s on the ocean. All the work has to be geared toward waterproofing. All fasteners are stainless steel; all the metal is either galvanized or metalized (a zinc-aluminum alloy). This is definitely a science project – and that’s what we excel at.”

The natural enemies on a barrier island are abundant – salt air, wind, fog, high groundwater, frequent flooding. But there are advantages too.

“It’s a little easier to work here than it is in the city because we have room for bigger equipment, such as big forklifts, cranes, motorized lifts,” says Humann, a solidly built man with a salt-and-pepper goatee and boundless, almost boyish enthusiasm for his work. “There’s a considerable amount of steel fabricating on this job, including custom-made sleeves for the air-conditioners, so we set up a shop on the site for the metalworkers. This is a soup-to-nuts complete exterior overhaul.”

The complexity of Ruzz’s method for installing this state-of-the art Exterior Insulating Finishing System is staggering. First, metal studs were attached to the faded stucco exterior walls. Panels of inch-thick extruded polystyrene (EPS) insulation were laid over the walls, then covered with waterproof sheetrock, which was taped and coated with an additional waterproofing agent. Then three-inch thick EPS blocks were laid on top of the sheetrock. Finally, a base coat of gray acrylic stucco was hand-troweled over the blocks.

All that remained was to choose the color of the finishing coat of acrylic stucco. But as so often happens on such projects, sharp aesthetic differences emerged. The board had formed a nine-member “color committee” to deal with this delicate issue, and one member wanted a pale-yellow hue like the one the hotel wore when it first opened its doors in 1929. The other committee members wanted The Pink Lady to be pink again; but some of them wanted a hot pink, while others lobbied for something softer, peachier.

A color expert employed by the engineer came up with six possible color combinations, and samples were painted onto exterior walls. In the end, after some intense debate, the committee compromised and settled on a pink between the two extremes.

“It was a heated discussion because people feel very strongly about color,” says Sy Landsman, the lone member of the committee who favored the original, historically accurate pale-yellow paint. “I’m not a happy camper, but the majority rules. We’ll live with it.”

And they’ll live quite happily, if early reactions are any barometer. As work on the first phase of the project, the east wing, neared completion in October, the response among residents was so favorable that Landsman felt confident offering a prediction.

“When the job’s done it will be back to its original grandeur,” he says, “and it will be the crème de la crème of the south shore.”


The Lessons of Lido

Looking back, all parties agree that the source of Lido Beach Towers’ headaches – both physical and financial – was that the boards in the ’80s and ’90s put off tough decisions. It is also agreed that no amount of wishful thinking – or cheap patching – will make major structural problems go away.

But it’s never easy for a board to sell residents on the need for costly repairs. Two keys to success are trust and transparency.

“I’ve always felt that if you have information, people feel more comfortable if you give it to them sooner rather than later,” says Weiss, the current board president. “People are more comfortable when they feel they’re being kept abreast of information, rather than having it sprung on them at the end. Trust is a very hard thing to buy back. Right now, everyone wishes this was the way we’d started out five years ago.”

Belli, the current vice president, agrees. “Doing it right the first time is certainly the way to go,” she says, “but you have to be careful to get the whole picture from the professionals so you know what you’re getting into. It’s not always easy to do that.”

As startling as the cost escalations have been at Lido Beach – they’re now about 700 percent higher than they were at the outset and likely to climb even higher – Belli says the situation is not unique.

“I’ve attended a number of the restoration workshops put on by the Council of New York Cooperatives & Condominiums,” she says, “and what I hear from other board people is that restoration costs tend to spiral. Based on that, I’d say our story is not all that unusual.”

What is unusual is the way the board, contractor, and engineer came together in the face of some withering adversity. “I’ve been in this business for 27 years,” says Flag’s Colao, the contractor, “and this job took a lot of cooperation among the board, us, and the engineer to keep this ship afloat. This project could have easily been derailed, but the board was outstanding.”

There were casualties along the way, of course. Merriweather, the ousted board president, knows perhaps better than anyone else just how difficult – and dangerous – it is to be the bearer of unwelcome news.

“It’s a twofold situation,” he says. “First, you have to look at the realistic affordability of doing such a big job and then at the consequences of not doing it. If you keep patching, it never cures the problems. Eventually, you’re going to have to do it properly.”

Subscriber Login

Ask the Experts

learn more

Learn all the basics of NYC co-op and condo management, with straight talk from heavy hitters in the field of co-op or condo apartments

Professionals in some of the key fields of co-op and condo board governance and building management answer common questions in their areas of expertise

Source Guide

see the guide

Looking for a vendor?