Page 6 - NY Cooperator November 2019

6 THE COOPERATOR — NOVEMBER 2019 COOPERATOR.COM Climate change notwithstanding, the onset of winter in our area generally means more wear- and-tear on buildings than any other time of year. Snow, ice and freezing temperatures can cause costly damage. That’s why it’s so important to make sure your building’s exterior and its various key systems are ready for whatever Mother Nature may throw at them between now and spring- time. Here’s a quick rundown of a few things supers, managers, and boards should be aware of. As Above... Waterproofing and energy conservation converge overhead, on your building’s roof. One of the most common issues affecting flat roofs are ice dams. Ice dams are formed when heat—both from inside the building and from the sun overhead—melts snow on the roof. The melted snow then runs into the much colder gutters and eaves, where it pools and refreezes. The continual freeze-and-thaw cycle creates ‘dams’ which in turn cause melted water to back up behind them, overrun the sides of the gutter, and seep underneath the shingles or roof membrane. Eventually, moisture can find its way into the building itself, trickling down into ceilings and exterior walls. If and when the ice dam breaks free, it can take shingles and gutters with it and, if the roof stays wet, mildew and mold can flourish, adding even more trouble to an already bad situation. There are many ways buildings can defend against the damage ice dams can cause—includ- ing having fiberglass insulation installed, ensuring proper venting in the soffits and eaves, and having a qualified roofer install ice dam prevention material on the roof—but on a day-to-day basis, your super or building maintenance staff should check regularly to make sure that all gut- ters and downspouts are clean and free of debris at all times. Those connection points between areas of a roof, such as where the roof meets the gutter, or where shingles meet flashing, can turn into problem spots for leaks, if left unchecked for too long. It’s also worthwhile to take a look at the caulking around you building’s windows and assess the integrity of the windows themselves. Depending upon the type of caulking used, as well as building conditions and how well the caulking was applied, it could need to be replaced every few years. The only way to really know when that job must be done is to have a qualified profes- sional inspect the caulking—but residents often can tell when something’s amiss because their units will be drafty. ...So Below While the roofs are especially vulnerable to wintertime woes, the parts of your building that Cooperator.com From Living in a multifamily dwelling requires tolerance for other people, particularly when those people are noisy, smelly, or have questionable taste in door decorations. In New York, where the majority of people share a wall with at least one other household, tolerance gets tested on multiple fronts. When one person’s floor is another person’s ceiling, residents are constantly reminded of how close they actually are to their neighbors. And proximity does not always mean congeniality. While many shareholders and unit owners can easily address their concerns with an offending neighbor, and that neighbor will readily make adjustments to accommodate those concerns, sometimes a situation sim- ply requires the involvement of a third party. Peaceful Enjoyment In the case of co-ops, condos, and homeowners’ associations, the property’s managing agent is the party typically tasked with listening to both sides of the conflict, assessing the veracity and severity of the claims, and offering suggestions for resolution. “It is an agent’s responsibility to make every attempt to amicably resolve disputes,” says Georgia Lombardo-Barton, President of Barton Management in Manhattan. “Whether it’s a co-op or condo, each apartment resident is entitled to proper and peaceful enjoyment of their apartment. All situations that violate that right must be abated immediately.” The approach to conflict resolution that Lombardo-Barton uses starts with an investi- gation of the complaint. Sometimes a resident complains about an odor or noise from an unknown source, or attributes the nuisance to the wrong unit. Neighbors are consulted and details sorted out. Depending on the nature, frequency, and time of day of the disturbance, determining its source and whether it violates the building’s proprietary lease can be a weeks-long affair. As soon as the source is identified, Lombardo-Barton’s agents meet with the owner of the offending unit to address the complaint. (It’s the actual owner of the unit who’s ulti- mately responsible for any resolution, even if the source of the problem is a tenant or sub- letter occupying the unit.) Careful and cooperative communication is key to an expedient, amicable resolution. Following that conversation, if it seems necessary, Lombardo-Barton will invite the affected party to discuss the matter jointly. She finds that these steps lead to successful resolution most of the time. When Talking Fails But then there are those other times where a dispute can’t be resolved by conversation alone. Scott Soifer, a managing agent with Charles H. Greenthal & Co. who manages build- ings in Manhattan and Queens, recounts two situations where disputes between neighbors escalated to the point where he had to involve a professional mediator. The issue in dispute? Managing Conflicts How Managers Make Peace BY DARCEY GERSTEIN In the hybrid part-owner/part-tenant world of co-op living, there exists an inter- esting and unique financial instrument: the underlying permanent mortgage (UPM). Part of the overall financing structure for any co-op, the underlying mortgage was conceived as a way to reduce the overall price of entry into co-op ownership. It also serves as a vehicle for tax benefits, and a form of collateral for the community as a whole when cash is needed for repairs and upgrading. Considering the hybrid na- ture of co-op ownership and administration, though, the notion of a ‘mortgage’ on the whole building can seem a little odd. Is an underlying permanent mortgage more like the mortgage on a multi-unit rental apartment building it’s modeled after, or the private home mortgage it also resembles? Should co-ops ‘roll’ the UPM, the way land- lords do the mortgages on their rental properties, leveraging their return indefinitely, or should they strive to pay off the debt and proceed debt-free, the way a homeowner would after they pay off their long-term debt? Or perhaps a little of both? The Typical UPM Typically, the terms of an underlying permanent mortgage resemble those of a com- mercial mortgage on a rental apartment building. The loan is usually for a period of 10 years, the interest rate is fixed for that period of time, and the amortization (the repay- ment of the principal) is based on a longer term – say 20 or 25 years. At the end of the 10-year term, there will still be an outstanding balance, which will require refinancing. This differs dramatically from typical home mortgages, where the term of the loan and its amortization are matched. That’s known as a self-liquidating mortgage. In other words, a 25-year mortgage is repaid over 25 years. After the final payment, the loan is paid off, period. No refinancing of the note is necessary. That’s not to say there aren’t some self-liquidating underlying permanent mortgages. There are, but they are few and far between. Typically, the payments of the UPM are split between shareholders as part of their monthly maintenance. Obviously, if a co-op building has no UPM, montly mainte- nance payments for all shareholders are lower. Lower monthly maintenance is a good Paying Off Underlying Mortgages The Pros and Cons BY AJ SIDRANSKY Pre-Winter Maintenance Roof, Boiler, and a Few Points in Between BY COOPER SMITH COOPERATOR.COM continued on page 7 continued on page 7 continued on page 16