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windowless bathroom - sally Sep 23, 2007


prewar building. windowless bathroom with air vent shaft that runs up a few floors until it ends where the apt layouts change. used to be a big metal duct running to a window on the upper-most apt but they removed it (secretly) when renovation work was done a few years ago. we now have no actual air ventiation to the roof. the question is: how can we get the resident sof the apt that did the renovation to replace the vent that is supposed to be there. the coop board will turn a blind eye. should we get a bldgs inspector?

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A review of the building code is required to find out if the building is today in violation of the code. For bathrooms and kitchens without windows, an exhaust system with mechanical ventilation is usually in order.

The existence of a prior air exhaust system, i.e., metal duct ending up in a window opening, is probably a sign that a code existed then when the buidling went up in the 20s.

Therefore, prior alterations of the apartments show that there was no regard for the code and that the building is in violation.

Obviously, it's up to the board to address the issue with an engineering company and those residents who bought or live in apartments with reconfigured facilities without exhaust.

AdC

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i believe the apt above removed the ducts inside the apt. how can e get them to replace them even if it was the owner before them? will draign be at teh buidings dept?

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This is where board should know when to put its foot down in a major renovation, when to demand the review of an engineer, when to demand a building permit, etc. to ensure that there are no violations of any nature and all units comply with the "warranty of habitability".

In your specific case, the board as the representative of the corporation who owns the property and is considered by government as "the ultimate landlord" may have to deal with the best way to cure the problem caused by the lack of fiduciary duty of another board or owner.

Thus, as bitter and difficult the situation is, the current board needs to address the issue.

In a case like this, I will involve the attorney of the corporation from day #1 to ensure taht all parties understand the issues. I would also involve an engineer study other alternatives that you may not be able to know,i.e., building an outside shaft, etc.

Your duty is now to attend to the violation if there is any according to the engineer base on the existing building code as the interior of the building has been modified.

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very tricky with boRD. I am almost sure the work was done illegaly wihtout board approval. there was a staff member who may have been involved. anyhow i put up a tissue ot the vent and it is getting positive air flow which should nto be happening. am thinking of simply calling 311 and letteing the buildings dept take it from there.

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If you are a board member or even a shareholder, then you should not turn your own building into the building department. You should discuss the issue with the board and take it as an opportunity to demonstrate your problem solving capabilities.

If you are only a shareholder, your position is to write a letter to the board state the facts and make them understand that it is for the good of the building and shareholders.

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they are genreally either in denial or illinformed by such parties as the MA. and, judging from previous experience, will not act on this effectively. especailly if it is not backed up from a more offical and knowing source like a city engineer. i believe it is a code violation. also it is problematic as the shareholders with the area of prior venitng will have to construct something in their apt to restore the previos ventiation. who pays for that?

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We had this problem in our building. Board members allowing illegal renovations:

Calling 311 will get thier attention, and unfortunately is often the only way to deal with boards who dont follow the rules. When you call you dont have to give your name, and you can track the action being taken on the Internet.

Make sure that you put everything in writing and save ALL Emails. Email EVERYONE, (other SH, MM, and board) everytime. The Email trail is a bad M.Agents and untrustworthy boards worst nightmare.

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Commercial Tenant - Allan White Sep 23, 2007


We are a new board of a 90 unit building with not much experience and are facing a situation where a commercial tenants lease will expire in two years.

Some of the board would like to find a new tenant as the current one is not ideal while some of the board might be inclined to renew the lease.

How does this process work? And who are the participants? Would our management company be involved?

Any advice here is helpful.

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First off, the cooperative owns the building; you have the right to choose whatever commercial tenant is best for the cooperative, regardless of the length of time your current tenant has been there.

It might be helpful to review with your managing agent or with a local realtor the rates for commercial leases in your neighborhood to ensure you are receiving market rates.

A realtor might also be helpful in discovering whether other commercial tenants might be available for your space, or others are looking for space in your area.

Your board needs to decide the optimal commercial tenant -- food-based tenants, for example, entail increased pest abatement, whereas a retail space might entail increased pedestrian activity. You state that your current tenant "is not ideal," but don't specify why; what IS your ideal?

Don't forget the 80/20 rule for "bad" income....

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2 questions...
may sound like a silly question, but have to ask....if it is a cooperative, i am going to assume the sponsor still owns the commercial? a separate investor? or does the cooperative corporation actually own the space according the the offering plan? (your collecting rent or maitenance?)

and; would raising rent effect your 80/20?

~AR

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sponsor rep ethics? - Derek Woods Sep 22, 2007


I hope i can make a messy situation clear. I'm on the board of a building has 5 former sponsor units (rent controlled with tenants) that the owners defaulted on back in the early 90's. The sponsor representitive had 3 buyers lined up over the past year to purchase them. When the board took them off the table, because 1 of the owners passed away, It was revealed that management never did a proper foreclosure of the units, and ALL of the previous owners suddenly resurfaced, and laid claims (through lawyers) on all of the apartments. they all want to pay arrears and get them back after 15+ years. Our lawyers says that we have no real options. Any thoughts appreciated?

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you say "all of the previous owners" i thought they are sponsor units? one owner?
was it a single action that was botched? or several? this was done 15 years ago? what about the other transfers? wasn't there title insurance? a lot of avenues and variables to be considered.

I am not an atty, and this requires the advice and council of your hired atty; however, I would assume there to be a statute of limitations. if not, there are H.T.O. laws that permit ownership to certain parties after so many years (I think NY is 15 years), providing certain conditions are met.

nevertheless, the management may not be responsible, but the atty and other professionals who performed the foreclosure.

~AR

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Find a really good real estate lawyer! It will be worth the cost. As the other poster here points out, there's probably a statute of limitations or if not some other way to keep control.

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Board Approval Required? - Anonymous Sep 20, 2007


I had my kitchen countertop and sink replaced at existing location. Did these things required board approval? Some of the board members are "up in arms" that I did not seek board approval. I live in a coop. I thought anything done behind the walls require board approval and anything visible do not (for example: changing a rusted out drain pipe (no approval req'd) vs rerouting pipe elsewhere in my unit (approval req'd). They want to fine me, but fines are nowhere stated in the proprietary lease nor amendments. Plus, wouldn't implementation required shareholder votes? Thanks.

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Search for Fines and Fees in other postings for answers to this part of the question.

Re Improvements:

Your improvements is a rather simple one. However, if someone else is doing it for you, you should at least protect yourself and others by demanding certificates of commercial liability insurance in your name and the co-op's name. Similarly, you should ask for proof of worker's compensation insurance. If one is not available, then you should have some sort of release in case of injury.

A simple form for this type of improvement should be in order. Remember, a sink and counter requires disconnecting faucets and water. If the person breaks your shut off valve, water may end up in the unit below. This is where mysterious waters and leaks appear and the co-op may be wasting tons of time trying to find out what the problem on hand was.

This is why COMMUNICATIONS (which is something shareholders demand from board) become essential on both sides of the fence.

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We do not typically require prior approval by the board for most alterations.

In all cases, without fail, only licensed contractors or vendors are permitted as evidenced by the presentation of suitable license and insurance documents.

However, if the alteration structurally affects the unit, e.g.: removal or relocation of walls, then we will require board approval after an engineer reviews and indicates there are no structural issues.

Rebuilding a kitchen, e.g.: new cabinets, counter tops, appliances, flooring, lighting, does not fall within this “alteration” category.

Likewise rebuilding a bathroom, e.g.: new shower, commode, sink, bathtub, tiling, single faucet shower control, lighting, etc. does not fall within this category.

If a unit owner wishes to add additional power receptacles in the apartment within the power supply limits, e.g.: total amperage available, of the apartment, board approval is not a requirement.

If a unit owner wishes to replace or modify the co-op owned parquet floor, then the building will require the owner to sign an agreement wherein the owner (and any subsequent owners) take responsibility for the floors should there be any damage. This means, if there is a water leak necessitating replacement of the parquet floor, the usual scenario is the co-op calls in a repair service to replace the warped parquet floors. In the case where the owner has modified the floor (e.g.; pickled finish), the owner takes the responsibility to obtain repairs to then be reimbursed by the building’s insurance carrier.

Any alterations or modifications require a building permit from the local government.

Owners are not permitted to replace the entry door to the unit.

Owners are not permitted to replace the unit’s glass sliding terrace door with a “French” door system.


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> Join the conversation Comments (2)


Ted,

Do you have a mechanism (i.e., form or otherwise) in which the shareholder informs the board or management about the presence of a contractor and provides the policies and licenses expected? Does the contractor need to register with your superintendent to know that they are in the building, pad elevators when bringing supplies, etc.?

Although I do not necessarily call "approval" as such, I think you have some type of procedure in place to ensure that the building is protected from damages to hallways, etc.

Would you please comment a bit further?

AdC



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We have a situation whereby as a small building, we have never had a formal procedure in place even for kitchen/bath improvements but your co-ops' requirements of asking for proof of licenses, insurance etc. is something we have had an informal "honor" system for. Many have passed through our building without showing proof of insurance docs to our Board and management. Now we have a new managing agent and a new board and we are trying to enact what you outline in your posting. One of the long time shareholders is balking at having to be the first "test rat" for this good practice. In fact he has refused to submit proof of insurance etc. If no one will be the first to obey these procedures, what can we do? Our management suggest sending a lawyer's letter but this shareholder can easily outspend us. Any suggestions?

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I presume your board has incorporated these rules formally into your House Rules? If so, they become an extension of the proprietary lease.

It's a fairly straightforward case that a shareholder ignoring House Rules is violating the PL, and PL violations are grounds for eviction.

A strong letter from your managing agent or coop attorney could be a good second step....

but a frank discussion with the longtime shareholder should be your first. He might respond to an anecdote from our co-op: a renovation done before rules were set in place came back to haunt us, six years later, when we discovered structural changes had been made that the board hadn't authorized... and which had impacted an entire line negatively. The costs for curing the defect could have run into thousands, had we not gotten very, very lucky with building design.

Alteration rules are emplaced for a very good reason. And I'll bet that your shareholder, if approached calmly and logically, will understand that rules like these are in the co-op's best interests, and therefore in its investors' best interests.

Perhaps your managing agent could even offer to expedite this first "test case" - help with any paperwork, filings, etc., as a sign of good faith and appreciation for being the first?

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Tell a SH - or not? - BP Sep 19, 2007


One of our SHs bought his apt from the sponsor a year ago, so we never saw his sale pkg or financial info. He wants to re-fi his mortgage + get a LOC. All we got is a letter verifying his annual income. We got a credit report and he owes A LOT (I mean, A LOT) on another mortgage, loans etc. It looks like he keeps getting loans to pay down loans and is overextending himself. He's self-employed for 2 yrs. '06 Income was good, almost double of '05, but self-employed people know income can vary widely from yr to yr. The board decided to not approve his re-fi/LOC request.

Three BMs want to tell him why we didn't approve him bec he's "already a SH and entitled to know." The others don't want to give him reasons, as you don't for rejecting a sale or sublet. They say BM's statements will conflict, the SH will misinterpret things, we'll get pulled into disclosing details and too much discussion, etc.

Anyone denied a re-fi for a SH? Should we tell him the reasons for denial or not?

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How is the process of admissions dealt with in your co-op? Attorney or manager as transfer agent?

(1) What is the reason for the re-fi... more debt, lower interest, fixed interest v. variable or other exotic type of re-fi, new auto, a wedding, vacations, etc.

The problem is knowing WHY prior to denying.

Your SH may be lowering his interest rate or obtaining a fixed interest mortgage on the shares, which will have a good benefit for his finances. In any case verify his documentation.

(2) If max'ed out, you may say NO to acquiring more debt, using it to get married or vacations.

AdC



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To answer your questions -

First, admissions/sale packages go thru the managing agent.

Second, the SH says the re-fi is "to lower monthly costs." But it's the same interest rate and monthly payment would be only $50 less. He also wants a LOC "for emergencies" with a monthly payment of $600-700.

He has a lot of other debt (per the credit report) and the only financial info he gave us is his gross income amount. The board already decided to deny his re-fi and LOC. The dispute is: a) should the managing agent's letter just say his request is denied or give the reasons? and b) should BMs be allowed to discuss the reasons with him if the letter doesn't give them and he wants a verbal explanation?

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I agree with AR and the fact that BM's should never discuss anything with shareholders.

My statement is always the same when we turn down a potential buyer and if the shareholder calls me directly: Discuss this issue with the co-op counsel who is our transfer agent. The counsel knows how to discuss the issues without putting the BM's in a bind.

Unfortunately, humans have feelings and memories; in some cases, if the person does not get his/her way, may become vindictive. This is WHY you want to avoid involving BM's into discussing all kinds of "bad news" or "corrective action."

I personally think that shareholders forget that BM's are residents of the building and neighbors in the same communicty. As such, BM's are entitled to ENJOY their apartments. The function they do for the co-op as BMs do not make them targets of questions from individual shareholders or ATTITUDES.

AdC




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Have the managing agent, never a BM, inform the SH in writing. I would write something on the following order...

Dear XXX:

After careful review and consideration of your refinance application, and the particulars relating to your specific refinance request, the following final determination has been made:

A refinance is permitted providing that no additional debt is incurred, or reserved in the process. The loan to debt ratio shall not increase by principle, or in interest. The total debt service payment amount must be equal to, or lower than the present payment.

Kindly understand that all determinations are final.
Thank you for submitting your application.

Sincerely
XXXX
Managing Agent

the BM should never place themselves in the line of fire, at any time. that is one of the resons you pay a monthly fee to the management co.


~AR

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Let professionals be the people who handle all sorts of notifications with shareholders. The board should only be able to review the application and make the determination.

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A similar situation once came up in our co-op. We asked our attorney for advice. He told us that the co-op has no risk in the HELOC, only the bank(s). So there's no reason to deny it.

If the shareholder is going to go broke, he'll do it with or without your help. Perhaps that wouldn't be so bad for your co-op because a bank will foreclose, getting rid of a shareholder who probably won't be able to pay his maintenance in a few years. Which will lead to foreclosure at that time.

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Except that...it seems to me that if the bank forecloses, there's a good chance that the apartment will be sold off quickly and for a below-market price, which would not be a good situation for the co-op. The only winner in a foreclosure scenario imho is a lucky buyer who gets a good deal.

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It's true that the apt could be sold off quickly, such as at an auction, at a below-market price. I see your point there. It's also possible that the bank will choose to sell the apt through a broker, with open houses and all the trimmings, in hopes of making more profit. Of course, it's hard to say which direction they'll go.

The bottom line, however, is granting or denying the shareholder's HELOC. I'm no financial expert by any means, but I would expect that even if the board says no, the shareholder will find another way to borrow the money. And incur the shareholder's wrath toward the board.

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You have read the problems in which many banks find themselves today for easy credit. The corporation needs to ensure that your shareholders have the means to cover, not only their maintenance but any other charges passed to shareholders as additional rent (asssessments) and eventually maintenance increases.

I think it is rather sad to see shareholders fail in a co-op. Also, is rather wearing for a board to deal with chronic late payers, letters by attorneys and half-recovered late fees and attorney fees. Our co-op had two of these chronic late payers that only paid at the doors of foreclosure. It was a "no win" situation for the co-op.

A co-op basically depends on the maintenances and additional rents (assessments) of its shareholders. If you were to spend half of your time trying to collect from 10 - 20% of your shareholder, I'm sure you will be going out of your mind and you will be rather late yourself in paying your vendors.

So... as difficult as it may be to tell people they don't have the minimum dough, DO IT for the sake of the co-op if you are sufficiently convinced that the person is not able to make it.

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Objectionable Conduct - Erick Anderson Sep 18, 2007


How does a co-op rid itself of a shareholder exhibiting what many many shareholders feel is objectionable conduct and presents a safety amd security issue as well as quality of life issue for its residents?

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is this your personal dislike of the person or what are they doing that is so bad?

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No personal agenda here. Some shareholders are suggesting the board to do something as this person is exhibiting frightening behaviors.

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you would have to be more dpecific for anyone to answer the question.

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Late night parties and noise...fights....alleged drug use and possible sales...undesirable (neighbors words...not mine) visitors at all hours....common area damage....fires....smoke...floods....locusts (that one is a joke...but all others are real).

But, on the bright side, the maintenance is always paid.

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if there are supected or alleged sales, then you have no case there. the neighbor might just be pissed more than anyone else. as a coop board, you simply have to write a letter to the owner of the apt about late night noise and hallway misuse with some specific dates of the incidents - and demand they remedy the situation permanently. if they dont then you have more of a case but you must give them a chance to "cure".

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Start the paper trail now. Get your co-op attorney to write the letter on behalf of the board and send to the shareholder detailing the bad conduct.

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also you can call the cops re: the late night noise when it is in progress. this plus the letter should nip it in the bud.

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Erick - A few things you should do:

1) If you can prove your SH is responsible for any damage to the bldg's common areas, have the repairs made, bill the SH for them, and send him a letter outlining the damage and telling him he's being billed for it.

2) Send the SH letters saying, for ex, "We have received complaints of excessive noise emanating from your apt at very late hours. Please be more considerate of your neighbors and be guided accordingly. Thank you..." Make letters more firm if you have to send them repeatedly about the same things, note that the noise/whatever constitutes a breach of the Prop Lease, etc. You may get to a point where a letter has to come from your coop attorney.

3) Tell your SHs to put their complaints to you IN WRITING. It's very important to keep a paper trail. Contact the fire dept or police when necessary so there are reports on file with them about this SH.

4) It wouldn't be out of line to do this. I know a few bldgs that have. If you strongly suspect drug use/possible sales, speak to someone at your local precinct, tell them of your SHs' suspicions, the "undesirable" visitors at all hours, etc. and ask the police if they can keep an eye on your bldg or at least have officers on your beat make more frequent checks or passes on your block.

5) Tell your super to keep a log of incidents, when he sees strange visitors go in/out of the SH's apt, when other SHs complain to him about that SH, etc. And tell him to tell SHs who complain to him verbally to put their complaint in writing to the property mgr.

It's not easy to evict a SH for objectionable conduct or anything - but you must establish a paper trail if things ever go so far that you need to take the SH to court. Without solid evidence and a paper trail, courts wouldn't even want to hear your case.

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Check out this article:

Booted Out

DESCRIPTION Objectionable conduct leads to eviction
TOPIC Evictions

AUTHOR Geoffrey Mazel
MAGAZINE ISSUE February 2005 - Number 209
ARTICLE TYPE Feature
PAGE # 16-19

ABSTRACT An examination of the decision that allows cooperatives to terminate the tenancy of shareholders based on their objectionable conduct, with guidelines that every co-op must follow when terminating a proprietary lease.

ARTICLE TEXT It has been nearly two years since the New York State Court of Appeals decided the matter of 40 West 67th Street Corp. v. Pullman. Board members and professionals are still trying to determine its effects and whether it is as profound as first thought. What are the effects on cooperative boards and management today?

In Pullman, the cooperative board of directors brought an action against a shareholder seeking to eject the shareholder and recover possession based upon his “objectionable” conduct. In 1998, David Pullman bought a cooperative unit at 40 West 67th Street. Immediately after moving in, he engaged in a course of conduct that was viewed by the board and many shareholders as disruptive and intolerable.

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Erick,

I'm no lawyer, so check with yours about what I say. First, read the Habitat article referred to here (you don't have to check with your lawyer for that), and check the NYT archives about co-op evictions. Look for the Pullman decision in 2003, or start with this link:

http://www.nytimes.com/2007/05/27/realestate/27home.html?fta=y

An eviction is possible. It takes a majority vote of shares (not individuals) to do so, although your Proprietary Lease may require a super-majority, so check with your lawyer. The vote typically must come at a special shareholders' meeting called for this purpose.

Naturally, you want a paper trail first, as other posters suggest. If you go the route of eviction, as a practical move you will want to have counted votes before calling the meeting lest the vote fail -- and the guy starts behaving worse as retaliation.

Bottom line, don't feel hopeless, and don't let this stuff go unnoticed. And call your lawyer!

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SH mortgage refinancing - BP Sep 13, 2007


Do any of you stick to a percentage limit (e.g., 80%) of an apt's market value for which a SH mortgage refinancing amount cannot go above? Is it the same percentage for newer and longer-term SHs?

If so, it is just a standing decision your board made or do you have a formal policy with regard to this percentage?

Lastly, we want to establish a set of formal guidelines for SH refinancing. What are things we should include?

Thanks

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We have a standing 80% limit, but folks rarely reach 80% as the income to debt ratios are applied.

On the other hand, we do not allow any financing or new financing within five years of admissions.

This prevents folks from “qualifying” and then immediately changing their financial picture with a new debt burden.

We had a recent occurrence wherein a buyer was approved at admissions to then appear at closing with a new loan package. The monthly costs in the new loan package were higher and our co-op attorney declined to proceed with the closing.

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In the last 90 days, we also had buyers come before the admissions committee and seek a waiver. In effect, the buyers “didn’t realize” there was no financing and or refinancing within five years and wanted to obtain a “larger” loan to cover refurbishing the apartment.

We declined the waiver, e.g.: no exceptions, but approved the buyers.

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Refinancing goes through the attorney and transfer agent. When a refinancing or credit line is requested, shareholders need to fulfill the same as an admissions package by way of financial information and credit report. If the financial starts looking strained, we may ask for an escrow of four months maintenance /18-months if they wish to proceed with their refinance.

AdC

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Ted makes some valuable comments.

refusing a refi/etc. within a certain amount of time after the initial closing is a great option. This eliminates the people who buy all cash, look great, are approved on the basis of a cash sale, then refinance because they have to pay back the relative that they borrowed all the cash from to begin with.

Also, to maintain 80% which is becoming more common now (as opposed to the traditional 90%) permits the cooperative a little more leverage in an unstable market. this figure should remain constant however at all times, as Ted said, not exceptions.

the paragraph below, as example, is excerpted directly from one of my purchase applications:

** Added Requirements If Apartment is Financed A copy of the commitment letter, loan application and three signed Recognition Agreements (Aztec form) which have been executed by the bank and prospective purchaser(s) are required if there is bank financing; additionally, copies of all documentation submitted to the bank in obtaining the loan must be submitted; no other form of Recognition Agreement will be accepted. The maximum financing allowed by the Board is 75% of the total purchase price. Purchases made with “all cash” will hold an 18 month refinance restriction.

I usually insert something to this effect in the second page of the purchase application, along with the other items that we want them to pre-agree to; this form gets signed and returned with he pkge, so there is no confusion later.

~AR

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anyone have a CELL TOWER? - sally Sep 13, 2007


wodnering - we are an upper west side cop. can anyone with a cell tower please tell us how much they pay for lease of their roof space? thanks URGENT

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Well, this is an interesting question:

1. How desirable is your location: near highway, hospital, university.
2. What company is trying to place the antennas and their market penetration and additional antennaes in your area.
3. In our case, almost five years ago, it was in the order of $1,700.



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thanks. was that $1700 annual or monthly? it is on riverside drive - higher than other buildings around it. no negotiations yet. prelim research. thanks

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MOnthly.

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how large is yoru building and what is location? thanks!

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We're in Westchester and this is a 7th floor bldg. Also, the company we have, although reputable, does not have the antennae penetration others have. Thus, our location was important to them.

Interesting enough, there were some problem with neighbors and shareholders were objectively briefed and involved to vote on their preference: Yes or No for the antennae installation.

The township restricted us to one installation and, as AR, states, it is important to put your foot down when it comes to negotiating dismantling of equipment at the end of the lease and authorization from the building to add additional equipment or upgrades.

Right now we were approached to upgrade the installation, but until they inform us what they are doing, no permission.

Similarly, make sure you hire your own engineer to assess the conditions of your building where the installation is going to take place and to review their structural installation.

No sense in getting $20,000 a year unless you know what you stand to lose or need to foot at the end of the installation.



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such as Subcarier Communications subcarrier.com they would be able to broker out the space to more than one tenant and guide you as to prices ( I am not connected with this company, I just saw them at Buildings NY)

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check this out. this habitat forum is getting lame becauset this is the kind of info one needs:

http://curbed.com/archives/2007/09/12/ask_curbed_renting_the_condo_water_tower_for_a_cell_antenna.php

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What terms are they offering? Are there other towers in sight? Any others in your neighborhood? Is the company a BIG brand or small? First time you've been approached?

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Been a few weeks since i was here...

I have towers and/or sites on about 12 of my buildings.
Each has a different lease and deal, ranging from $20K per annum to almost 60K.

As another poster put it, location is important. Depending on the vendor, some sites (like sprint)have all their current towers and sites mapped right on their website. This helps when bargaining the lease.

Also take into consideration the future value of the site and the area covered. They usually put into the lease that they have the right to add/change equipment and do not need permission, other than entry to the site. Do not permit this. All and any added equipment must first be approved by management/owner and the space it occupies (if more than the original agreed upon space)is not included in the current lease agreement. This becomes an addendum and more revenue.

Can’t think of anything else off the top of my head..

~AR

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A perplexing issue - BP Sep 13, 2007


My friend Nancy is VP on a coop board on Long Island. She called tonight for advice. I didn't know what to tell her.

Her coop has 40 apts. The sponsor still owns 10. His father and 2 male cousins own apts and were elected to the board last yr. The coop has 5-yr board terms, God only knows why. These 3 sponsor relatives constitute a board majority. They hired a super soon after they were elected: no experience, lazy, bad attitude, won't help residents, does zip in the bldg. They don't do anything about the super and won't OK any upgrades or work beyond emergency repairs for the bldg. Nancy says she thinks they didn't just find him. She thinks they knew him and he's a "plant".

Nancy said the sponsor doesn't let the same people sublet for more than 1 year and they're all very undesirable and irresponsible - almost seems like he gets them on purpose. She also said the 5th BM (Frank) who really cares about the bldg as she does told her the sponsor's father (a BM, and 82!) let it slip to Frank last week that the sponsor wants to run his ownership share into the ground and default on everything bec he has BIG trouble with the IRS and wants to wangle into a position where he can declare bankruptcy.

Nancy said no one likes the sponsor and could care less about him, but he owns 25% of the apts and what he's doing and what his relatives are doing (or rather, not doing) as BMs is affecting the entire coop. It isn't high-end, but it is very nice (40 yrs old) with large apts, community room for meetings, garage, and big, landscaped backyard that's used for parties, BBQs, etc. in a good neighborhood.

OK - any ideas on what Nancy and the other BM Frank can do to prevent the sponsor from turning their coop into the black hole of Calcutta? Nancy and I know each other since grade school muh-muh-muh yrs ago and she's not the type to exaggerate or overreact, so I tend to think she's giving me a pretty fair picture of the situation.

I've dealt with a lot of coop issues in my time, but this is a new one on me.

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You have painted a Practice Case for those who exchange ideas.

Well tell your friend to read the by-laws and specifically, the area, HOW TO GET RID OF A BOARD MEMBER and plan the battle accordingly. Go for the HEAD and forget about the rest! Once you take possession of the HEAD you can start organizing.

GET RID of one of the SPONSORS, elect a caring, individual shareholder and NOW she has a majority of individual shareholders to sponsors. BINGO!!!

Regarding your posting, I shall say the following:

The shareholders of that place may DESERVE the sponsor:

1. They are 75% individual shareholder owned and yet they still vote for sponsors and people related or friendly to a bad sponsor. GOOD DEAL!!!

2. They are subleasing in a 25% rental and 40 unit bldg. Well, not too smart either. I would like to find out how many sublets are currently present.

Finally, sell if she is so caring and go to another unit if she's not willing to put the fight for "THE IMPOSSIBLE DREAM".










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Thanks, AdC. I must say I don't think much of the SHs in that bldg either for voting in 3 sponsor-related people. I didn't ask my friend but I THINK the regular SHs didn't know those 3 were related to the sponsor. He sold them their apts so he didn't have to tell the former full board or anybody in the coop anything about them.

Sounds like a very big cans of worms to me. If I was faced with that (and I may tell my friend this), I'd seriously consider selling and living elsewhere. I'll pass along your comments to her. Thanks.

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Realize that with the sponsors 25% of the total votes, and his relatives, collectively, he controls about 32-35% of the total voting power in the building.
This means that if as little as 30%, or 12 apartments don’t show up at the meeting, or provide a proxy at a shareholder/annual meeting, then the sponsor wins almost by default.
so, it may not be that other shareholders are actually voting for him... You (your friend) needs to acquire enough votes to overcome the sponsors percentage. this is the only way you will beat him.

~AR

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AR, that's a good thought. It occurred to me this morning bec Nancy said the sponsor owns 10 of 40 apts - 25%. That's why I asked her how many shares that represents. In my reply to RLM, I said she just told me it's 20-22% of total shares. You're right. She has to get almost all the rest to support her. Seems her coop's other SHs are getting worked up about how things are going, so if she/Frank start now to rally them, they could get the support they need. She's got a lot of work ahead. After listening to her problems, it makes my coop sound like Utopia.

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It's an arduous task, but worthwhile, especially if the sponsor presence is diminishing or dwarfing the value of the building.
Good luck!

~AR

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HOW TO GET RID OF A BOARD MEMBER and plan the battle accordingly.

The proxy war starts by knowing your shareholders and convincing them of what is happening. Thus, such a battle can be bitter.

Thus, the exit plan is there: sell and go some place else.

AdC

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That's quite a story, and I been a'thinkin' on it a spell..... so I have some questions.

1. What does her PL say about amending the PL? What % is needed?
2. What does it say about the % needed to call a special Shareholders Meeting?
3. Does it hold any recourse for recall of Board Members?
4. Is this a union building?

Depending on the answers to the above, if Nancy and her friends can call a special Sh. meeting for the purpose of amending the PL, and successfully gather votes needed to amend it, they could employ a number of tactics:
- add two members to the Board;
- require that all Board meetings be taped and transcribed;
- require the super to pass certain competency tests (if not union);
- have direct Sh. election of president, sec'y, treasurer;
- require a Managing Agent to supervise the super directly (you didn't say whether Nancy's co-op has one or not; if they do, what the heck is the MA doing? and if they don't, they should hire one as soon as they're in control of the Board.

Those are my first reactions. Hope they're helpful; I'll keep thinkin' on it.

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Thanks for your thinking on this. I called my friend Nancy first thing today to get answers to your questions.

- Her PL can be amended with a 66-2/3% SH vote
- To call a special mtg: 25% of all outstanding shares
- Recalling a BM requires a 66-2/3% SH vote
- It's a non-union bldg

The bldg had a MA but the 3 sponsor-related BMs fired them last year and hired a company without looking at others - probably a friend of the sponsor, Nancy thinks.

Nancy says regular SHs complain about the useless super. They can't reach the MA - they get voice mail, and no one calls them back. The only BMs they can reach are Nancy and Frank. The 3 sponsor BMs won't take their calls or talk to them about coop biz - they're told to call the MA if they have a problem, which does no good.

RLM, I gave Nancy your good ideas this morning. I think her best bet is getting SHs to sign a petition for a special mtg to recall the 3 sponsor BMs and bring in 3 regular SHs. Luckily, Frank is board secretary. From my experience I know a request for a special mtg has to go to the secretary and if enough shares petition for it, he can schedule it and they can hold it no matter what the 3 sponsor BMs say.

RLM, I didn't know what to tell Nancy, but I'm getting more ideas and she was very "up" this morning when I told her your thoughts, and her wheels are turning now too.

BTW, I asked her how many shares the sponsor has. She can't recall the exact number, but she remembers that his 10 apts + the 3 BM apts are about 20-22% of all shares. So if they can rally enough regular SHs, they could effectively get a 66-2/3% vote on most anything.

I said in my previous post that this coop has 5-yr board terms. The 3 sponsor BMs began their 2nd yr this past May. I didn't know until this morning, but Nancy/Frank are in their 5th yr and they have to step down in May '08. If 2 SHs are elected who aren't as knowledgreable or concerned as they are, things will get much worse I'm sure.

Thanks again, RLM. You've been a great help. If you happen to think of anything else, let me know.

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Recycling bins - question - BP Sep 09, 2007


3 of our BMs say reg trash bins can be any color but the recycling bins must be "recycle blue". 2 BMs say they only need labels showing what to recycle. We called the city 2x. Both times they just said recycling is the law and you must display recycling info. (I hate dealing with city offices.)

Our new svc area colors are tan/dark green/burgundy. Rows of bold blue bins will be an ugly contrast. The 3 BMs will concede if someone tells us we won't break the law by not having blue. Our prop mgr did but they think he's wrong.

This should be the biggest problem a coop has, right? Will someone pls confirm that we won't get 5 to 10 up the river if we don't have blue recycling bins so I can enlighten the 3 BMs? (all newbies, in their first year).

Ugh, thanks.


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Totally lost here. Can you try to explain again what your question was. I lost you after the first few words typed.

FN.

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Sorry, FN, if I wasn't clear.

We're redoing the service areas our residents use - trash room, laundry, storage. They're in the same general place off the lobby which is tan, dark green and burgundy. We're painting the service areas these same colors so there's some "continuity" with the lobby.

We're getting new bins (10) for our trash room. 3 BMs say they must be blue for recyclables - the blue you often see on bins with a white "recycle" symbol. Rubbermaid makes a lot of them. Our SHs are very picky about having everything coordinated. Since the trash room walls/floors/doors will be the same colors as the lobby (and other bldg areas) some of us think bold, blue bins will look ugly/loud in an area that's tan, dark green and burgundy.

3 BMs say the law requires blue bins for recyclables. The rest of us say it doesn't require blue. They'll concede if someone else will agree with us on this.

So, my question was - do bins (containers) have to be blue for recyclables or not?

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BP. As long as the containers are not going out on to the street they can be any color you want them to be, As long as the correct color sticker is displayed on the can and that you use clear bags in the cans (both cans) for the disposal of contents.

If the cans are going out to the street then they need to be either one blue and one green with the proper stickers or both blue with the proper stickers.
Also not that recycled areas much have a sticker either on the door or above each recycle area. Directions must also be placed above the cans, along with pick up times.

Pgrech
VP, Superintendents Technical Assoc.

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You gave me the answer I was looking for - also some info I didn't know. Our super handles the trash pretty well so we assumed he knows what he's doing. You said you're supposed to use clear bags for recyclables. He uses blue bags for glass, paper, cardboard, magazines, all of it, and he uses clear bags for regular trash. Surprised we haven't gotten any Sanitation Dept. violations for that. We'll have to set him straight on this. Thanks again.

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What I did in my building was we have two square rubbermaid containers on each floor. I called 311 and asked for the sticker labels for the recycing. They said all I have to do is place one blue sticker label on the container and use a clear bag. and the other container I placed the green sticker label and use a clear bag. On each sticker label it explains what is suppose to be placed in that container.


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Thanks, Mike Mac. We have the blue + green NYC labels that you put on trash containers that tell you what to recycle. Our board "dispute" is whether the containers (trash cans) for recyclables (glass, paper, etc.) MUST be blue or if they can be any color - black, brown, grey or whatever - as long as we put the blue + green NYC labels on them.

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