Director of Management,
Craft a Long-Term Plan
Setting the Scene
I manage a 70-year old cooperative in New Rochelle. It was facing a major facade project in 2013 that was going to diminish its reserve fund severely. On top of that, the co-op had a large list of projects looming on the horizon. The property is unusual because it was originally built as a co-op and didn’t have an underlying mortgage. The board discussed taking out a mortgage, but before they did that, the directors wanted to plan ahead so they could use the money to tackle the full list of projects.
Following the Action
We worked closely with the board and with such professionals as engineers and contractors, and we put together a budget plan for all the projects that we needed to do, which included natural gas conversion, electrical upgrades, sidewalk replacement, and lobby and hallway renovations.
After the plan was approved, the co-op took out a mortgage to tackle the work strategically over the next few years. The board also bought the ground lease on the building, and even had money left for the reserve fund. Our successful strategy was to reach each project before it became a major issue. The shareholders are very happy; they’ve seen the improvements at the building.
Doing It Right
The lesson for boards and managers is to put together a long-term plan and look at all available options. It relieves a lot of stress, saves you time, and removes a lot of burden from the shareholders. In the end, you’re able to get projects done proactively instead of reactively, which saves you time, money, and countless headaches.