New York's Cooperative and Condominium Community

Habitat Magazine Business of Management 2021

HABITAT

NEW YORK CITY

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.

Last year, a rent-controlled tenant approached the co-op board of her building with a welcome proposition: If the board would buy her out, she would leave, and they could sell the apartment for a handsome sum. "She got a big pile of money, and we will get an enormous pile of money," says Carl Tait, president of the board at 152 West 58th Street, near Central Park. When all is said and done, this 33-unit co-op will clear $600,000 in tax-free cash. The building is currently under contract with a buyer for $950,000 for the two-bedroom apartment.

Many co-op shareholder and condominium unit-owners like to use electronic banking to pay their bills, a method commonly known as ACH, which stands for Automated Clearing House. ACH credit transfers include direct deposit payroll and vendor payments. Wouldn't it be great, though, if there were a system that let you pay your maintenance or common charges with a credit card? Some feel that's more convenient than writing a check — and you could earn bonus points or airline flight miles. Many say they'd be only too happy to pay for the convenience of it all.

For a condo association or co-op board, nuisances take on all shapes and sizes, and the word "nuisance" doesn't even do the issue justice: These are quality-of-life and even health and safety concerns that involve the place your residents call home. Here, two veteran property managers give two real-life, practical responses to two common nuisances: hoarding and excessive noise from an apartment — with the latter covering an interesting additional issue.

Many buildings end up in possession of a vacant unit when a rental occupant moves out. With rent-controlled or rent-stabilized apartments, this often happens only when the tenant dies. However, if conditions are right, the building could negotiate with a willing occupant to leave under sunnier conditions, leaving a cooperative or a condominium association with an apartment it can then sell. But those negotiations can be tricky. Rental regulations provide strong protections to a rent-controlled or rent-stabilized tenant, who will often want a sizable severance price, especially if the apartment is in a desirable neighborhood.

When a co-op board sells a unit that it's acquired by a rental apartment's vacancy, you must wear two hats: one as the seller and the other as the discerning board carefully reviewing a potential shareholder's financial dossier. Just because a board enters into a contract with a buyer doesn't mean the board has relinquished its right to reject the shareholder.

After two devastating North Atlantic storms in two years, heavily hit insurance companies are becoming increasingly cautious. What can co-op boards and condominium associations expect in the coming months in terms of rates and coverage? Habitat spoke with independent insurance broker Michael Spain, third-generation head of Long Island's Spain Agency, for his views on current trends.

Is it a matter of perspective? Or, in the end, does it matter if you see the other guy's point of view?

Those are the questions I pondered as the management executive talked with me about her relationship with a client as though it were a partnership made in Hell. "I've given up trying to reason with the boards," the executive said. "Now, I just do what I'm told — only drawing the line at illegalities."

Digital Accounting Tools for Boards and Managers: NexusPayables

Written by Sheryl Nance-Nash on September 10, 2013

New York City

As the treasurer of his co-op board, Andy Ashwal goes through a regular ritual with his managing agent: "She either e-mails me a stack of invoices that I have to print out and then review and sign, or she leaves me a package at the desk and I have to look through it and sign it. And if I have questions, I put a little sticky Post-it note on it and send it back to her. Then she e-mails me or calls me with the answers to the questions."

How quaint. How 20th century.

Directors and Officers Insurance Does Not Cover Intentional Discrimination

Written by Adam Leitman Bailey & Colin E. Kaufman on April 26, 2013

New York City

In New York, public policy is that you cannot be insured against intentional acts that bring about intended results, such punching someone, causing injury or purposely discriminating against a member of a protected class. One cannot profit from one's own wrongdoing and thus, for example, the well-known prohibition against killing one’s spouse and collecting the life-insurance proceeds. Insurance companies cannot pay a judgment against an insured for punitive damages.

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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