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CO-OP/CONDO BUYERS

Storage Room Licensing Agreements: What to Know, What to Expect

Tom Soter in Co-op/Condo Buyers

It was four years since the shareholder moved out and only a month since the board of directors at the 50-unit, Upper West Side cooperative had ordered her storage locker emptied of unclaimed items. But then the ex-shareholder suddenly turned up — and threatened legal action over the disposal of her "valuables." The board was in a quandary: Was the building liable?

Probably not, but there would never have been a question if the co-op and the shareholder had had a properly drafted, and simple to create, storage room agreement.

A storage room licensing agreement, usually drawn up by the co-op or condo board's attorney, is a document between the board and the shareholder who rents the space. Some properties hire storage companies, such as Bargold, which builds the bins and collects rent from the residents, with a percentage going to the co-op/condo. Such companies typically have licensing agreements of their own with the residents, which the board has reviewed and approved.

In most cases, the board will neither call nor consider your licensing agreement "a lease," which gives more rights under the law, explains co-op attorney Arthur Weinstein, a founder and the vice president of the the Council of New York Cooperatives & Condominiums. "There is a more limited right with a license agreement," he notes.

"A licensing agreement is revocable," adds Ira Meister, president of Matthew Adam Properties. "When you have a lease, you have to through landlord-tenant court to revoke it; it's much more difficult to terminate."

No Dead Animals

A licensing agreement for storage space regulates what can and cannot be stored in the building's basement space. That means, in typical language, that you may not store a living creature or organism, or any dead animal; gasoline, oil or oil-based paints, fuel, grease or flammable chemicals; corrosive, toxic or hazardous materials or waste; asbestos; construction debris; new or used batteries; weapons or ammunition; anything with a fuel tank; liquid propane tanks, oxygen tanks or similar containers; and food, fertilizers, pesticide or items that are wet and could mildew. A typical agreement will also prohibit lodging or sleeping in a storage area; cooking in one; or holding meetings, parties or other gatherings there.

The agreement will also likely define the hours that you can gain access. This is security a concern. One co-op, for instance, found a bed set up in a locker-room area. "Someone had slept there for a couple of nights," recalls David Khazzam, vice president of management at PRC - Property Resources Corp., the co-op's manager. "That should be clearly forbidden. [Boards] are still bound by the building codes."

Someone had slept there

for a couple of nights.

In terms of liability issues, the agreement will likely contain a warning such as: "All property is stored at tenant's sole risk. Lessor is not responsible for damage or loss to person or property caused by fire, smoke, water, weather, vermin, insects, interruption of utilities, unexplained disappearance, negligence of lessor or lessor's agents, or any other cause, including theft and criminal acts of others."

The agreement will stipulate the amount you'll pay for use of the space. Some buildings charge a flat fee based on bin size, while others tie it to maintenance, and increase it at the same percentage as the maintenance. Ray Hoey, president of a 65-unit Upper West Side co-op, says his building has both storage lockers and storage rooms. The corporation charges between $30 and $50 a month for the use of the amenity. Since there are fewer spaces than tenants, there is a waiting list.

Having written protection is important for both parties. "If you don't have an agreement, everything open for discussion," observes Khazzam. That includes being clear about when the agreement ends — usually when you moves out.
Otherwise, four years later, there could be a big, messy situation. And who wants that?

 

Adapted from Habitat March 2003. For the complete article and more, join our Archive >>

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