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24 Feb 2017
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A Goldmine for Real-Estate – The New Developments on Astoria’s Coast

Derivative of “Astoria – Megler Bridge from Astoria Column 01” by Joe Mabel, licensed under Creative Commons Attribution 3.0 Unported.

The coast of Queen’s Astoria is undergoing major developments. Soon the quiet front will be filled with buildings “with panoramic views of Manhattan into a gold coast” (Hughes, C.J., NY Times, 2017). The unpleasant sight of warehouses, power plants, and empty lots will transform into an upscale row of residential complexes, schools, and markets. Despite the combination of the luxurious views and high-end improvements to the area, the real-estate market is hesitant to implement co-ops and condos. Until the market receives enough traction, units will only be for lease. However, this has not deterred development by any means.

So who is taking on this endeavor to transform Astoria’s coast? AKI Development has already completed their ‘Graffiti House’ which comprises 28 units on seven floors. The building’s modern interiors and street art influence reflect Astoria’s artistic roots. AKI has also begun developing six other sites. Alma Realty Corp. is preparing for the influx of people with its 18 story building, comprising of 404 units. The building will be ready to move in this upcoming fall, and residents will have access to a variety of amenities. Alma Realty Corp. is also looking to acquire a 2.2 million square foot building. However, in order for Alma to take on this immense project, it will require a 421-a tax exemption.

Among other developers taking advantage of the opportunities in Astoria are the Durst Organization, who is adding to its portfolio a 20 story building and a plan to develop a 21,500 square foot market in 2018, and Excel Development Company, who is implementing an eight story residential building.

The new innovation is spurring further development in Astoria, including a ferry and Citi Bike’s $5 million investment for a kayak project. The potential migration of New Yorkers to Astoria will benefit the area’s real-estate and local businesses. At present, the greatest issue for new residents is the lack of transportation. Astoria is hopeful that the new ferry will offset this concern, making it easier for professionals to get to the city.

24 Feb 2017
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How to be a Good Board Member to Avoid Litigation

  

The best managed co-ops and condos are those with exceptional board members. Not only does this create a sense of community, but it reduces the risk of the board running into litigation disputes. Shareholders select board members to make and implement day-to-day decisions for the building. As a board member your role is to protect the interests of all tenants, owners and shareholders.  This requires playing an active role, effective communication, and demonstrating good leadership.

Communication

The key to good management and avoiding litigation is communication and transparency. As a board member, you need to regularly take the time to communicate with other board members, tenants, owners, shareholders, staff, and the super. Maintaining these relationships creates a good sense of community and culture. Understand individual concerns, and implement an easy system that allows non-board members the opportunity to share their ideas or concerns.

In addition to communicating in person, send out newsletters and emails to ensure that everyone in the building is up to date. Treat everyone equally. Listen to their input. Make the time to talk to your neighbors. This will create a positive atmosphere and when issues do arise, residents will not be hesitant to talk you. Make sure you take care of any complaints in a timely fashion (usually 24 hours).

Ask for Help

As a board member, it is vital to know when to ask for help and who to ask in order to make the best informed decision. When there is a problem with the building, whether it is a financial or maintenance issue, it is important to be transparent with building residents to avoid future disputes and litigation. If the board is unsure how to solve a problem, in addition to speaking with the building’s counsel, it can be beneficial to ask other owners. In times of crisis, well managed boards have conducted 30 to 60 minute Q&As between the board and unit owners. Not only will owners appreciate the time you take to hear their concerns, but this is a good method to brainstorm solutions. Having financial troubles? Consider getting advice from a financial education management company that has experience in advising board members.

Decision-Making and Leadership

Resolve issues quickly and efficiently. Commit time to tackle your building’s obstacles. Board members are burdened with making tough choices on behalf of the building. It is key to ultimately make decisions that benefit the building and owners in the long-run. Certain short-term decisions might be unpopular. However, if board members effectively communicate the reason behind their decision-making, residents will be more understanding. During these times, maintain a positive attitude and be mindful of others to avoid any potential disputes.

Demonstrate good leadership. To keep your residents happy and expenses low, ensure that projects are completed in the allotted time frame. As a board member you are responsible for hiring efficient and expedient contractors. Keep residents informed of how the work is coming along. Do not leave any room for uncertainty.

17 Feb 2017
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ADA Compliance for Condo and Co-op Renovations

In a city renowned for its architecture and buildings, from iconic buildings recognizable in the city skyline to brownstones in residential neighborhoods, it is important for New Yorkers to acknowledge the right to equal access for individuals with disabilities. Title III of the American Disabilities Act of 1990 (ADA) gives civil protection to the disabled by requiring buildings to provide equal access to tenants, shareholders and owners of co-ops and condos. This applies to all “public accommodation and commercial facilities” built and occupied after January 26, 1993. The New York City Commission on Human Rights (CCHR) offers a further layer of protection by also instructing landlords, and co-op and condo boards to reasonably accommodate these individuals with disabilities. The CCHR interprets reasonably to include:

  • Interior and exterior ramps
  • Accessible bathrooms
  • Electronic doors
  • Handrails
  • Accessible parking
  • Assistive listening devices

Joshua S.C. Parkhurst, partner of Cary Kane LLP, explains that “The statute itself is broad, but the accessibility guidelines do provide a lot of specifics, and must be reviewed very carefully. The guidelines regulate even the placement of ATMs, saunas, steam rooms, laundry rooms, and their goal is to make it so that most people with disabilities are able to utilize the facilities of the building.”

However, when deciding what is reasonable, the nature of the amendment and its cost are taken into account. If a disabled individual wants to purchase a top floor apartment in a pre-war building it would not be deemed reasonable to install an elevator as it could destroy the physical integrity of the building and be very costly. In past situations, condos and co-ops have opted to implement portable wheelchair lifts, which are temporary and less expensive. This means that buildings do not have to undergo lengthy and expensive renovations in order to comply with ADA regulations. That said, NY CCHR’s Law Enforcement Bureau ideally would like all buildings in the city to provide equal access (including all pre-war buildings).

If your co-op or condo begins renovations, it is important that any and all changes are ADA compliant. Additionally, if the building revamps the front entrance and there is no wheelchair ramp, it is imperative for this to be installed at the time of construction. If your building needs guidance on how to comply, consult your building’s counsel.  The Mayor’s Office for People with Disabilities and CCHR is another great resource.

10 Feb 2017
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WHEN ROMANCE AND DUTY CLASH: CONDOS, CO-OPS, RELATIONSHIPS AND CONFLICTS OF INTEREST

 

As we find ourselves approaching Valentine’s Day, the subject of love comes to mind, with pictures of hearts, flowers, and Cupid as far as the eye can see – in every subway station, on every bus stop, and in your local Duane Reade, as you resist the temptation to buy a heart-shaped box of chocolates for “no one in particular.” Maybe we find ourselves looking around those places we frequent often – the local Starbucks, the gym, our office building or apartment building – to see if Cupid’s arrow will find a conveniently-located target. After all, when people spend a certain amount of time together, friendly and romantic connections are bound to happen.

However, if you’re a member of your building’s board and your Valentine’s Day dreamboat is a building employee, contrary to what the Beatles taught us, the love you take may only be equal to the problems you make. Your relationship can create a host of problems you may not have anticipated. As a member of your building’s board, a romantic entanglement with a building employee could create a conflict of interest, disclosure of which is strongly encouraged by applicable law. Should an issue come up before the board regarding your love interest, you are also supposed to abstain from voting, for example, if the keeper of your heart wants to hire additional staff or recommends termination of a part-time doorman. Regardless of how the board votes, building residents may wonder whether your budding romance affected the board’s decision. Other residents may also feel reluctant to report complaints about your better half give your position on the board.

Ultimately, the choice to pursue the object of your affection is yours, but given the potential consequences, it just might be better to look for love outside of your building.

07 Feb 2017
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Avoiding the Suite

Lawyers are often the butt of jokes at cocktail parties (a few of them are more truths than jokes), and are often the go-to weapon in shareholder disputes.  Many people believe attorneys to be a reactionary necessity, but a good business person and a well-planned coop board knows that attorneys can provide well suited precautionary defenses.  The purpose of retaining legal representation is to avoid running afoul of the law in day-to-day business. While litigating is sometimes a necessary strategy, it is nearly always a long, costly process.  An association runs the distinct risk of having property values decrease as prospective buyers shy away from investing in a community embroiled in lengthy litigation. On top of that, a potential buyer may have their lenders deny them loans in connection to a building that is the subject to litigation.

Arbitration clauses written into contracts and leases can be a huge time (and money) saver.  Problems over common elements, cases involving elections, improperly held board meetings and failure to provide access to records would be better handled in arbitration, and agreeing to that resolution medium before conflicts can really help calm any heated tempers.  Prearranged agreements with contractors regarding payment terms and completion costs can also prepare coop boards for the possibility of catastrophes.  It is almost always easier to negotiate how your contractor will pay for, or repair mistakes before they happen.

Litigation, while certainly a needed bow in the quiver, should be a final line of defense.  An experienced attorney knows how to head off common building issues before they happen.  Even then, there are steps to take before litigation.  When tempers flare, cooler heads to come to the table.  Often, third parties such as attorneys and arbitrators can resolve conflicts without the need for court intervention.

03 Feb 2017
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Real-Estate Developments and New York’s Airbnb Crisis

It’s the beginning of a new regime in the White House, but federal agencies are continuing to implement real estate policies from Obama’s administration, creating new precedents and leaving many questions.
Governor Andrew Cuomo implemented a deal with trade unions and the Real Estate Board of New York (REBNY) to reestablish the 421-a tax abatement. The 421-a tax abatement is a tax exemption program established in 1971 to facilitate greater development of multi-unit residences in areas with vacant land. The scheme significantly reduces property tax for a period of ten years to incentivize real-estate growth. Developers in certain restricted areas – Geographic Exclusion Areas (GEAs) — can only utilize the tax exemption if they agree to provide a number of affordable housing units, usually 25 – 35%. Since of all Manhattan is within a GEA, the only way developers can utilize 421-a is by guaranteeing a portion of affordable housing.

The Benefits:

  • Developers building multi-unit residences in vacant land will not have to pay the usual taxes for a three year construction period.
  • This benefits trade unions and the real estate sector as this boosts real-estate development and the economic growth in low vacant areas.

However, this reinstated policy fuels the Airbnb problem in NYC. Owners of affordable housing in these areas who list their property on Airbnb (in spite of laws making it illegal to lease or sublet an apartment for a period less than 30 days) are partially responsible for the increase in rent prices in the City, as found by a study conducted by affordable housing advocates, who found that rent in NYC significantly increased in areas where Airbnb flourished. Democratic Assembly member Linda B. Rosenthal stated that Airbnb permits its members to “promote illegal activity that breaks New York State law, violates building and safety codes and zoning, threatens tenant safety, destabilizes our communities, and depletes our rapidly vanishing affordable housing stock.” Gov. Cuomo recently agreed to allow authorities to fine Airbnb hosts a maximum of $7,500 for breach NYC rental laws.

Developers are now able to take advantage of the tax exemptions if they promise to set aside a percentage of units for affordable housing however, if new regulations are not implemented to fix the Airbnb problem in NYC, then the issue of affordable housing will continue to exist.

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