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Beware of costly lobby, public space renovations.

In the management of cooperatives and condominiums there is nothing more divisive than the renovation of lobbies and other public spaces. It can poison the relationships among various factions of the building's residents for years. It also has the potential to turn into a fiscal black hole, and often leads to less than satisfactory aesthetic results. This need not happen.

Over the years, we have been involved in managing the renovation process on countless occasions. As a result, we have gained some insight into how to ensure the greatest likelihood of success:

1. Unless the lobby is beyond redemption, do not attempt a complete makeover. It is better to deal incrementally with decorating issues. People accept small changes and it's a less risky approach.

2. If you must proceed with a major effort, try to build a consensus among the residents, and set up a mechanism to allow those who are interested to become involved.

The most effective structure is the appointment of a special committee with one or two board members participating, but the majority should be nonboard members. The committee should represent all the diverse interests of the building's residents.

The committee mandate should be to select a designer, develop a proposal for presentation, prepare the cost-estimates, and if the scheme is approved, supervise implementation.

Generally, the committee should have borad authority for aesthetic decisions. All financial matters must remain with the board. The committee members who also serve on the board form an important channel of communication to deal with issues as they emerge.

Another factor in a successful renovation is frequent and open communication with all owners. General meetings of owners are necessary at several milestones:

* When the board first seeks a mandate to undertake cosmetic work. Usually the decorating committee is appointed at this time or shortly thereafter.

* When the board first seeks a mandate to undertake cosmetic work. Usually the decorating committee is appointed at this time or shortly therafter.

* When the scope of the work is defined. The committee may present alternative proposals to the owners. In a recent case the options involved three levels of lobby renovation, ranging from gutting the lobby to renovating the existing lobby, and corridors and introducing air-conditioning in the hallways. In this case, the owners preferred minimal refurbishing, and allowed residents of each floor to renovate the hallways at their option and cost. But it had to be at building standard. The air-conditioning of the hallways was not approved.

* When the design is completed. At this meeting the budget and the schedule of the work are presented. If a consensus is not reached at this meeting, expect spectacular fireworks.

* When the proposal is approved. Often the final decision is not made at the meeting where the proposal is presented. Usually this last, decisive meeting follows the proposal meeting by a month. In the intervening period, the design is displayed to allow all owners to inspect it, and to disseminate additional information that may have been requested.

Once the design and the budget have been approved, communication is as important as ever. Newsletters and notices should be sent to all owners describing the progress of the job, and to alert them to any events that might restrict or impair their use of the building.

Even after the approval of the renovation project, the number of possible nightmare scenarios is not diminished: lack of consensus among the committee members on aesthetics during implementation; discovery of new conditions that vastly increase the cost; mismanagement of the renovation; and, worst of all, an unsatisfactory result despite everyone's best intentions. When such problems arise, communicate immediately with your constituency. Present the problem to the broadest forum.

Otherwise, that slender thread of trust will snap into acrimony.
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Copyright 1993, Gale Group. All rights reserved. Gale Group is a Thomson Corporation Company.

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Title Annotation:Property Management/Improvement; Section I; evaluation for apartment cooperatives and condominiums
Author:Brecher, Oskar
Publication:Real Estate Weekly
Date:Feb 24, 1993
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