Could YOUR Building Rise Like a Phoenix After a Fire? One Co-op's Story

Impelled to Act

By the time the fire at The Broadlawn was extinguished, the roof and top floor of one of the complex's 16 buildings were destroyed. Firefighters had pumped 500,000 gallons of water into the blaze. Seven apartments were uninhabitable, and three had suffered significant water damage. An ordeal that would drag on for more than two years was under way.

The first thing we realized

was that communication

was going to be the key.

Even before the fire trucks left the scene, the co-op's seven board members were coming together in full crisis mode — and making their first mistake. The board's insurance agent arrived, along with an insurance adjuster he had worked with in the past. The agent assured the board that this adjuster was the ideal man for the impending negotiations with the insurance carrier, Greater New York Insurance Companies (GNY), and its adjuster. The directors, feeling pressured to act quickly and decisively, hired the recommended adjuster on the spot.

"There's a lot of panic and fear at a time like that," says Chris Vescio, an accountant who was then the board's president. "I felt responsible for dealing with it... But if I had to do it again, I would take time to talk to [more candidates before selecting] an adjuster."

Après le Déluge

On the Monday after the fire, the board met with the shareholders whose apartments had been damaged or destroyed, as well as the co-op's managing agent, attorney, architect, insurance agent and the new adjuster.

"The first thing we realized was that communication was going to be the key," says James Glatthaar of the law firm Bleakley Platt, who has been the board's attorney since 1992. "We called that meeting to reassure people that we were all over the situation and we would get them back into their apartments as soon as possible."

People who attended the meeting describe it as "hot," with worried shareholders asking questions about what was covered by insurance — both the co-op's policy and their own homeowner policies — and two shareholders revealing that they had not renewed their homeowner policies, as required by the house rules. The news was unsettling. The shareholders learned that the co-op's insurance would pay to restore apartments to their condition at the time of the co-op conversion, in 1982. Any modifications made since then would have to be covered by the homeowner policies. The games were just beginning.

Workmanship Brinksmanship

One factor that would turn the games into a chess match was the workmanship of The Broadlawn. Built in 1928, the co-op's buildings are blessed with architectural details that speak to a past when elegance and artistry mattered — brass hardware, plaster crown moldings, lath-and-plaster walls and solid wooden doors. On the downside, the 80-year-old electrical wiring and plumbing were archaic by contemporary standards. The board was determined to preserve the building's integrity and charm; it quickly became apparent that integrity and charm were not covered by the policy.

One thing working in the co-op's favor was that the contractor doing the roof repairs admitted his subcontractor caused the fire, and wished to continue on the job and make the building whole. The board, which had been happy with his performance until then, decided to keep him on rather than hire a new contractor or use one recommended by their insurance company. It was a question of control. The board had a working relationship with this contractor — and no knowledge of the insurer's contractor.

"The board didn't want one-stop shopping — the insurance company's adjuster bringing in a contractor he'd worked with in the past," says the co-op's managing agent, Jeffrey Stillman, vice president of Stillman Property Management.

For the struggles between the insurance company and the board, the building's reconstruction and the lessons learned, watch for Part 2 this Thursday.

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Photo: The Broadlawn following the fire. Click to enlarge