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Six money-saving tips for co-ops and condos.

In this occasionally difficult decade, it is more important than ever for condo and co-op boards to save as much money as possible in running their buildings. Here are six tested suggestions:

1. Save energy in big ways. In the debate between oil and gas, pros and cons exist for each side. Economically, oil is less efficient, but because many owners have used it for years and are comfortable with it, they are reluctant to switch. A main disadvantage of gas is that there is only one supplier, and yet it is generally cheaper than oil.

Under the circumstances, we often recommend that our boards of directors consider a dual-fuel system that can use either gas or oil, thereby permitting building management to take advantage of whichever is less costly at the moment.

2. Save energy in small ways, too. For example, don't overlook such apparently negligible costs as lighting. Replace incandescent light bulbs with fluorescent fixtures in the lobby and corridors. Fluorescent lights generally burn 10,000 hours, while incandescent burn about 1,000 hours. And even though fluorescent is much more expensive per bulb, it ultimately saves about 60 percent on electric bills.

There are three other reasons to switch to fluorescent. Incandescent creates heat in the corridors, which increases airconditioning costs. With bulbs that last ten times as long, you reduce expensive labor hours replacing them. And, finally, utilities like Con Ed provide a sizable rebate on fluorescent bulbs.

3. Review certiorari (questioning your real estate tax assessment) more aggresively. Don't just call in a lawyer to ask for help. Systematically plan to review it every five to eight years. Get appraisals, and be prepared to take them to the highest levels of the appeals process.

Remember: it's y - money, and you're entitled to it.

4. Monitor reserve funds. Unless a building's funds are particularly strong (often the case, for example, in those on Fifth and Park Avenues and Central Park West), the reserve should be large enough to cover all capital improvements and repairs. Using reserve funds for day-to-day operations in these buildings is a disastrous idea.

5. Evaluate amenities carefully. Decide which ones are essential, and which aren't. The answers aren't always clear. For example, few buildings retain elevator operators anymore. Even buildings that do so often also have automatic elevators. A typical building may spend up to $180,000 per year in operator salaries. So why keep them? Because owners believe that having elevator operators in their buildings increases the market value of their apartments, and promotes a perception of security.

6. Finally, never hesitate to question your managing agent about building operations and costs. Given the value of your apartment, it makes sense to be sure you're receiving good and thorough information.

In order to get the most for their money, it's imperative that condo and co-op owners pay closer attention to how - and how well - their property is managed. Remember, these owners are living there, and decisions that affect their investments truly "hit home. "
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Copyright 1992, Gale Group. All rights reserved. Gale Group is a Thomson Corporation Company.

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Title Annotation:apartment cooperatives and condominiums
Author:Brecher, Oskar
Publication:Real Estate Weekly
Date:Oct 28, 1992
Words:502
Previous Article:RSA continues service and advocacy.
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