Preventive maintenance cut costs, NYARM experts claim.

Preventive maintenance was the catchword at the New York Association of Realty Managers' August seminar. In discussing various ways to cut management costs, the three featured speakers emphasized the idea that keeping buildings and accompanying paperwork in good shape is less costly than paying for unforeseen emergencies.

"Properties that are operated in the cheapest possible fashion are not the best run properties," said Richard B. Montanye, a partner with the accounting firm Marin & Montanye LLP.

"The thing that is most important is to assemble the right team, including an owner, a manager, an accountant, an engineer and an attorney, and have them as part of your property full-time. All of that comes toward planning."

According to Montanye, building managers spend a lot of money every year because they don't prepare for eventualities, such as tenant injuries and natural disasters. When something does happen, they end up paying extra for getting their paperwork in order and for demanding overtime from the building staff.

"My philosophy is that we'll have good years and we'll have bad years. As a property manager, you have to put money away for a rainy day," he said.

"Also, many of my clients are in denial about the increases in the real estate tax and in insurance. So they put off paying the vendor. From a budgeting standpoint, when you don't pay a vendor on time, it's going to be more expensive for you in the long run."

Montanye's view was seconded by Stephen Elbaz, president of Esquire Management Corporation, who recommended such measures as color coding various office documents and keeping a list of contacts for every employee's vacation house.

"I know that the color paper is nerdy, but believe me, it saves time," he said.

"If you have a different color for every type of document and then change the color every year, it will take you 15 seconds to find something, instead of 30 minutes. You're saving a great deal of time."

Elbaz also advocated the use of free office beverages, transit checks, and other workplace perks to keep employees happy and productive.

"My best buildings are the ones I never hear from," he said.

"If you are nice to your employees, they will think better of you, and try to do a better job. The 75 cents that you will spend on a soda will seem miniscule compared to what you will be saving by keeping your employee at the job site."

For his part, Robert S. Nelson, president of Nelson Management Group, spoke about the importance of choosing the right tenants and up-keeping the image of the building.

"Be extremely selective with applicants for apartments," he said.

"To the extent that they have bad credit it means that you'll be up there on the list with unpaid Visa bills and phone bills. You'll be wasting time and money trying to collect rent."

On the other hand, Nelson recommended prompt response to any tenant complaints.

"One of the biggest wastes of time in our industry is going to court," he said.

"In responding to complaints, you decrease the likelihood of disciplinary action against you."

Finally, all three speakers stressed the usefulness of email as a communication tool.

"Email has turned out to be one of the most effective ways of communicating," said Montanye. "You can do it by just pressing a button. So when you sign a lease, send a copy to you accountant, your lawyer, and all of the members of the team. Same thing goes for meeting minutes. Distributing information about your building is part of communication and prevents emergencies."