New York's Cooperative and Condominium Community

Habitat Magazine Business of Management 2021

HABITAT

NEW YORK CITY

It's a familiar scene: Something happens between board members causing distrust, scrutiny and even rebellion. Yet condominium and co-op board members have an obligation to each other and to their communities to set aside differences and stay focused on community business. Here are some tips for boards to review to make sure your relationships stay intact and your community's interests paramount.

Co-op and condominium boards have many reasons to lay out a five-year capital-improvement plan. Among other things, it helps you budget, it helps eliminate or lessen assessments, and it makes lenders look more favorably upon your building and its residents' apartments when it comes to refinancing. And for condo associations, Fannie Mae — a.k.a. the Federal National Mortgage Association — requires you have a capital plan or put aside 10 percent of the monthly common charges.

Q. I am on the board of a co-op that is a "no pet" building and has been that way since its inception 50 years ago. In the last few years, shareholders have gotten dogs in the building and the board has been having an extremely difficult time enforcing the No Pet Rule. Please explain when a shareholder can keep the pet and when the board should start legal proceedings.

When we think of the challenges of overseeing co-ops and condominium associations, we might think of late payments and aggressive pets. But another challenge has been waiting in the wings:  the aging of America's baby-boomer generation, many of whom are choosing to live out their golden years in their homes. There's even a term for this: NORC — Naturally Occurring Retirement Community. It's a trend presenting condo and co-ops boards with new and unique challenges.

You no longer have the right to live in a no-dog building. People with allergies, people afraid of dogs, people who don’t like dog waste and urine on the sidewalk or loud barking, or even people who’d simply rather live without dogs — sorry, but your rights and preferences are meaningless.

That, at least, is the message co-op and condo boards, attorneys, and others are taking from the plethora of people falsely claiming a disability to avoid pet prohibitions. Not physical disability or psychiatric disability, for which there are specially trained service dogs, but emotional disability — which no one can see, anyone can claim, and for which your friendly family doctor will write a note, no questions asked.

A board needs to maintain good relationships with its co-op shareholders or condominium unit-owners in order to get necessary building work done smoothly and with as little rancor as possible. And for contentious issues, being able to unite residents in order to move forward is a must — as is community harmony simply in terms of quality-of-life. Veteran property managers often find themselves caught between intractable boards and aggrieved residents. Often, it's the board who can and should make the first move to smoothen relations. Two experienced managers tell us how they've helped clients do so.

Two common problems that co-op boards and condominium associations should be aware of in residents' apartment renovations are that the jobs don't get done on time and the contractor fails to comply with the hours and days his crew is allowed to work. What can you do about it? At a 26-unit co-op in Tribeca, the board addressed these issues by requiring the contractor to read the alteration agreement and sign off on it before work begins.

It's a New York tale told more and more frequently as the economy and the real estate market continue to rebound. A buyer in a 26-unit co-op in Tribeca decided to make extensive renovations on his new home before moving in. The co-op's board of directors gave the green light, and work began.

A year later, it was still going on. And with it, the disruption. The dust. The contractors. The noise. Cut to: two years later. The work was still going on. The contractors. The dust. The noise.

The patience of shareholders was wearing thin, so the board checked the shareholder's alteration agreement to find out when the work was supposed to be completed.

Illegal residents, whether long-term tenants or night-by-night, Airbnb-style guests, are one of the most problematic issues for condo associations and co-op boards. They can be difficult to identify and document, but have unfettered access to your building and to other residents. There's no way for a board to know, for instance, whether an under-the-radar renter is a sex offender or has a criminal record. Think we're exaggerating? Here two veteran property managers offer their real-world experiences.

It happens more often with co-op buildings, but the occasional golden opportunity sometimes arises when a condominium association can buy, perhaps fix up and then sell an apartment and reap the profit. Yet aside from all the same issues a co-op board faces in terms of  pricing the unit properly for sale and deciding whether to use a broker, as discussed in past articles in this series, condominiums have their own specific issues that, when properly addressed, need not be obstacles.

Ask the Experts

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Learn all the basics of NYC co-op and condo management, with straight talk from heavy hitters in the field of co-op or condo apartments

Professionals in some of the key fields of co-op and condo board governance and building management answer common questions in their areas of expertise

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