The Meter is Running
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It pays to do multiple repairs or projects at once.
AUTHORDaniel Wollman, Gumley Haft
The backdrop. We manage a large condo building that was gearing up to spend about $500,000 on parapet repairs and some facade work. The cost just to rig the building and put up scaffolding was about $100,000. One of the things that we discussed extensively with the board was taking a broader approach to reviewing the needs of the building, which has a fair amount of terra cotta. Instead of just focusing on a portion of the building, we discussed sounding the terra cotta on the entire structure and creating a more comprehensive repair plan that would really take the building into the next 10 or 15 years.
Chasing leaks. Every time you go after a leak, it could cost you $200,000, $300,000 or $500,000. Instead of constantly rigging and bridging the building, fixing everything at once would save significant money over time. For this condo, we brought in another engineer and did some value engineering to come up with different ideas the board could consider. After looking at the various alternatives, the board decided to move forward with a larger repair that encompassed the entire building. The cost was $7 million.
Selling the big fix. The building had been converted about a decade ago and had been sold “as is,” and it was perhaps not as well put-together as one had hoped. The board’s thinking was: “Why don’t we restore this building to its initial grandeur and make it the best it could possibly be? Yes, it’s going to cost a lot of money, but in time everyone should realize the benefit.” The board did a fabulous job communicating with unit-owners to prepare them and explain all the issues. It imposed a significant assessment and also got financing to pay for the project. At the end of the day, the unit-owners agreed with the board that the building repairs were clearly going to increase the value of their own investments.