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Morningside Gardens Co-op Board Refuses to Play Kick-the-Can

Bill Morris in Bricks & Bucks on September 28, 2022

Morningside Heights, Manhattan

Morningside Gardens co-op, Local Law 11 facade repairs, balconies, flip tax.

The co-op board at Morningside Gardens saved millions by refusing to kick the can down the road.

Sept. 28, 2022

Many co-op and condo boards in New York City play kick-the-can — spend as little money as possible now even though it means you’ll probably have to spend more than necessary in the future. The board at the Morningside Gardens co-op in Upper Manhattan does not kick the can down the road.

Witness the just-completed repairs and upgrades to the balconies, bulkheads and facades on the six towers that make up the 968-unit complex. The co-op had a Safe With Repair and Maintenance Program (SWARMP) in place from Cycle 8 of the Facade Inspection & Safety Program, formerly known as Local Law 11. With the filing for Cycle 9 looming on Feb. 21, 2023, the board faced a major decision: go cheap or go big?

“The idea is that by doing the work for both cycles now, we’re saving millions of dollars by not having to put scaffolding and sidewalk sheds up twice,” says Tiana Leonard, who has served on the co-op board for six years and is now president.

To be precise, according to the co-op’s engineer, Chris Krepcio, a principal at Merritt Engineering, that far-sighted decision will save the co-op upwards of $4 million. “It’s an action-oriented board,” Krepcio says. “Most boards put things off and let future boards deal with it. The Morningside Gardens board understood that by spending the money now, they’re saving money long-term.”

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Though the mandated facade and balcony repairs came on the heels of an extensive repair of the co-op’s undulating sidewalks and related drainage systems, the board decided to spend $10.3 million on the SWARMPs rather than do part of the work now and put the rest off to a later date.

“The tricky part was getting the board to understand that there were additional brickwork repairs that would be flagged on the 9th Cycle,” Krepcio says. “They took advantage of having the sidewalk sheds and scaffold already in place from the 8th Cycle, and they decided to go ahead and do the 9th Cycle work now.”

The work was paid for without an assessment or maintenance increase. “We’re fortunate to have a large capital reserve fund,” Leonard says. “We’re also fortunate that we refinanced our underlying mortgage in 2020, when interest rates were still low. And since this co-op went from limited-equity to market-rate, we’ve had a transfer fee that’s now 15%.”

Krepcio, who also served as one of three project managers, met with the board monthly as the completed sections of the sidewalk job opened the way for repairs to begin on the facades and balconies. “That was another tricky thing,” he adds, “coordinating between the sidewalk project and our projects.”

Many of the 60 balconies on each of the six towers were enclosed, which gives shareholders additional interior space. Those enclosures had to be dismantled, then reassembled after the railing and surface repairs were completed.

“Where some of the railings went into the concrete slab, we had to chop away old concrete and replace it,” Krepcio explains. “We were able to scrape, repair and repaint the steel railings, which saved us some money.”

Railings also had to be added to the top of the bulkhead on each tower roof, which supports mechanical equipment.

Of course there were surprises. “But when changes came up, we were able to talk things through with the board and get things accomplished,” Krepcio says. “As I said earlier, this is an action-oriented board.”

PRINCIPAL PLAYERS — ENGINEER: Merritt Engineering Consultant. CONTRACTOR: Skyline Restoration. PROPERTY MANAGER: FirstService Residential.

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