New York's Cooperative and Condominium Community

Habitat Magazine Insider Guide



Kathy Kahng, President, 159 Madison Ave.

A New Jersey native, Kathy Kahng earned a Bachelor of Science degree at Cornell University and is the founder of CityRax, a consulting firm specializing in so-called street furniture — everything from the Department of Sanitation’s smart composting bins to modular newspaper vending racks in venues like Grand Central Terminal and Bryant Park. Kahng, who also serves on both the Transportation & Environment and Parks & Public Spaces committees for Community Board 5, spoke with Habitat about her decades of service as board president at 159 Madison Ave., a 12-story, 118-unit co‑op in Murray Hill — and why she’s in for the long haul.


The backstory. When I moved here in 1989, three years after the building was converted, the co-op was way over-leveraged. The developer actually went bankrupt and pretty much left the place in shambles. A lot of former renters had been able to buy their apartments super cheap, but they couldn’t sell them because potential buyers couldn’t get mortgages due to the building’s finances. People were actually abandoning their apartments, and the co-op ended up owning 13 of them. There was a real estate broker on the board we contracted with to sell the apartments. He managed to do that in about two years, which started to turn the tide for us. The co-op was able to refinance the mortgage, which put us in a slightly better situation, though it was still tough. 

Hard-hit. We have managed to squash down the debt, but our finances continue to be a challenge. Because we’re in a business area and there are so many commercial rentals around us, we’re getting killed on property taxes, which account for about 45% of our budget. Also, the sponsor, who went bankrupt early on, negotiated a 99-year lease with a commercial tenant, a carpet store, for $1 million in cash before he split. The tenant now sublets the space and pays so little rent that we’ve tried several times to get out of the lease, but we’re stuck with it.

As far as fiscal management, we’re super-tight. But since there’s no place else to go as far as cutting expenses, we’re always looking for ways to raise revenue. Shareholders approved a flip tax in 2019, which has boosted our reserves by about $50,000 a year. We used to raise maintenance every three years, but now we do it every year and try to keep the increases as small as possible.

Top to bottom. We refinanced our underlying mortgage in 2021 and took out a couple million for capital improvements. One of the conditions of the mortgage was that we had to replace all of our giant windows, which were the original ones dating back to 1911. Now we’re putting a new layer on the roof, and after that we’ll install a new emergency braking system for our elevators. All of the elevator mechanicals have to be replaced, because the existing system is too old for a retrofit. Also, we are going to try to bring one car directly to the basement, which isn’t connected to the rest of the building. You have to exit the main entrance, go out on the sidewalk and use another entrance where the elevator goes down. And because we want the building to be 100% compliant with the Americans With Disabilities Act, we want one cab to go up to the roof, where we have a garden. We’re analyzing the bids, but the roof part of the project may not be feasible at this point.

The energy picture. As for Local Law 97 and potential fines, we’re in pretty good shape. Of course, we didn’t know the law was coming, but with a 100-year-old building there are certainly energy inefficiencies, and we have picked the low-hanging fruit to do as much as we could, including converting our boilers to dual fuel. The big megillah that we are wrestling with now is retrofitting our HVAC system, which I’m actually excited about. We are looking to go from the original steam-heat system to heat pumps. Several shareholders have already installed them in their apartments, so we know it works. That will allow us to get rid of our sleeve and window air conditioners, which will not only make the building more airtight but also really clean up the facade. 

Somebody has to do it. I’ve been president for nearly 30 years, and it certainly keeps you on your toes. It can be a fairly complex thing dealing with shareholders and management, but we have a great board of directors — people who have served a really long time like me and some new members, so it’s a good mix. I’ll keep doing the job because honestly, no one really wants to be president. If someone says, “Hey, I want to take over,” I would certainly consider it. But in all the years I’ve been doing this, no one has ever said that.

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