Printer Friendly

Finding the right manager for turbulent times.

In the current state of the economy, building owners and coop/condo boards are faced with tougher decisions than ever. Those looking at leaner budgets are discussing ways to increase reserve funds, lower maintenance costs or stabilize rents. Others, feeling the pinch from escalating taxes, water and sewer rates, are deciding on whether to leave the City for Westchester or other boroughs. How can a management company keep a building afloat in these "turbulent waters?" In a word, communication.

Keeping the lines of communication open between a managing agent and a board of directors or owner can eliminate small problems before they turn into major ones. A simple misunderstanding of the goals of a board or a misreading of some board members' wishes can have disastrous results. If a management company, for example, isn't use to explaining the intricate details of a building's financial report to a board or building owner, everyone may not have a clear diea of wherer their funds are going. This can only create financial pandemonium for the residents in the long run as well as mistrust for the management company.

Co-ops, in particular, require extensive communication, even more so than their condominium counterparts. When residents own shares in a property instead of owning an individual unit, they often need a management company that is ready to teach a board member everything from the basics of what a board member is, what the duties of a board president are, and how to conduct meetings to legal and financial matters. Because of the current state of the economy, they also require a management company to perform the day-to-day activities, such as forming committees to oversee the various duties involved in taking care of a building and checking collection of maintenance bills to see that they are paid on time.

Part of a management company's "openness" with co-op boards should include custom-designing information packets and gearing monthly meetings to an individual board. This will help, for example, when dealing with the special needs of co-op buildings that have renters as well as shareholders. A quality management company will never forget the delicate balance of information that must flow between a manager and board.

Similarly, condominiums also require proper communication, especially now when effective management is crucial to keeping a building profitable. Competent companies, for example, will stay in constant touch with a board in order to come up with creative ways for co-ops/condos to lower their operating costs while at the same time maintaining their level of quality service. Lowering maintenance costs is a key concern of several condominium and coop boards alike.

Effective communication with the residents of a property will also enable a management company to foresee defaults before they arrive and be prepared to handle the many legal ramifications involved if it does happen. They must know when to serve notices to the banks and tenants, keep close contact with the board, and be detail oriented. Only a management company that is on top of these matters will pull a building through this type of situation.

For those buildings looking at limited budgets ahead, a professional management company will explain how to hold off on any proposed capital spending until the cash flow of a co-op or condo improves. In many instances, a management company will defer spending on unnecessary maintenance costs until a board can reasonably afford them. This also means initiating minor improvements on existing building systems instead of installing new equipment, when appropriate.

Owner-sponsorship should also not conflict in the effective managing of a board. If a company does have a controlling vote on a board in the buildings it owns, for example, it should always let the other members of the board vote first so it has an understanding of exactly what their needs are.

Although several property management firms have their beginnings in developing and owning buildings, the ones which survive and prosper in the New York area are the companies that never forget what it's like to be an owner of board member themselves. Back in the 50's, a manager/developer only needed to land a great piece of property and they would be successful; today the stakes have changed-- companies need to be out there and really know the board members because they're the ones who have the decision-making power.

Daily communication, therefore, is essential to managing, but it is not the only method used to successfully managed buildings --having fully computerized office operations should also be a high priority when choosing a management company. If a management company has a sound internal office, it will funnel straight through to a company's relationship with a board.

A successfully managed building is one in which the board members are encouraged to take an active role in the management of their property. But this can only be accomplished by a company who understands the particular area as well as its residents.
COPYRIGHT 1991 Hagedorn Publication
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1991, Gale Group. All rights reserved. Gale Group is a Thomson Corporation Company.

Article Details
Printer friendly Cite/link Email Feedback
Title Annotation:Property Management Supplement
Author:Low, Marvin
Publication:Real Estate Weekly
Date:Oct 2, 1991
Previous Article:BOMA publishes guide on ADA compliance.
Next Article:Water metering and the 'Window of Opportunity.' (program of New York Bureau of Water and Energy Conservation) (Property Management Supplement)

Related Articles
IREM-CIREI partnership offers Internet guide for real estate.
Coarse treatment makes heat flow surge.
NIC's New Web Site Tells All.
Is your real estate in good hands? A look at property management. (Insiders Outlook).
Conference calendar.
Conference calendar.
Recruit the right people.
Executive Coaching in Turbulent Times.

Terms of use | Copyright © 2016 Farlex, Inc. | Feedback | For webmasters