New England Condominium February 2021
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Board Style and Management  Hands-on vs. Hands-off   BY COOPER SMITH   FEBRUARY 2021        NEWENGLANDCONDO.COM  Bryan Hughes, president for New England for FirstService   Residential, says, “This can be difficult to generalize as each   community,  and  each  board,  has  a  different  flavor.  They  are   made up of people, so each situation is different.” He divides   his boards into three categories: too engaged, appropriately en-  gaged, and disengaged.  “For management, disengaged boards may be easier to deal   205 Lexington Avenue, NY, NY 10016 • CHANGE SERVICE REQUESTED  continued on page 6   THE CONDO, HOA & CO-OP RESOURCE  CONDOMINIUM  NEW ENGLAND  While residents generally like the idea   of community that living in a condomin-  ium or co-op provides (that’s why many   opt for this type of ownership), few are   as excited about the idea of serving on   their community’s governing board, or   on any of the various committees their   board may set up to oversee special proj-  ects. As important as long-term supervi-  sion of many specific aspects of commu-  nity life may be, it’s often very difficult   to find volunteers willing to do their   part.  Among  the  factors  that  influence   volunteering for board service are the   time commitment (real or perceived),   discomfort with potentially being the fo-  cus of resident anger and antipathy, and   plain old apathy.  On  the  other  hand,  for  those  who   overcome those obstacles  and  hesita-  tions, board service can provide a feel-  ing of accomplishment, a level of pres-  tige within the community, and a way to   have a personal hand in maintaining the   security and safety of what is likely their   biggest financial investment.  The Value of Time  Board service is completely volun-  tary, and the most common reason both   co-op shareholders and condominium   owners cite for not volunteering is lack   of time. It’s not hard to understand why   this is; board and resident meetings are   generally held in the evening, and while   those meetings could (and should) be   run in a quick, efficient way and be done   within an hour or so, they very often run   longer—sometimes much longer. Most   residents work long hours and aren’t es-  pecially keen to add multiple additional   hours to the end of their day. Additional-  ly, board members who agree to serve as   Condos and co-ops are unique in their management structure, of which there are   two levels: the board of the association or corporation, which governs the community   on behalf of the unit owners or shareholders, and a hired management agent, who   conducts the day-to-day affairs of the property. Of course, some communities go their   own way and choose to self-manage, but they are the exception to the rule—particu-  larly in communities larger than 20 units.   The question is, in professionally managed multifamily communities, how much   responsibility and authority does a board delegate to outside management, and how   does that affect how a given community functions?  The Spectrum  While each and every board is different and has their own style, managers report   there is a ‘spectrum’ to board styles that ranges from minutely to barely involved.   “There are two kinds of boards,” says Dan Wollman, CEO of management firm Gum-  ley Haft. “They can be autocratic and dictatorial, or collaborative. In my experience,   more are autocratic—and that has to do with the fact that most owners are ambivalent   and apathetic. They don’t actually want to be on the board, which effectively leaves   one or two active, engaged people on the board to run the building. This is very com-  mon. It’s simply the more pervasive style. Personally, I prefer a collaborative board,   one that wants to be there. Collaboration allows for everyone to give an opinion and   make a consensus decision, even if it’s not the one I personally recommend. I also like   a ‘big-picture’ board—one that’s involved, but not bogged down with minutia. A board   should never spend an hour discussing what type of cut flowers should be placed in   the lobby. I want them to see where we are spending their money for a big project. It’s   important that they see and feel where the money is spent. It gives them a far better   perspective when they talk to shareholders—and that’s extremely valuable.”  Overcoming Apathy  Getting Residents    Interested in    Board Service  BY COOPER SMITH   A Look at Board Powers  What a Condo or Co-op   Board Is … and Isn’t  BY A J SIDRANSKY  continued on page 7   When one buys a private single-family   home,  it’s  clear  who  the  king  or  queen   of the castle is: the homeowner. When it   comes to condominiums and cooperative   apartments, however, the relationship be-  tween owner and property is a little more   complex. While the shareholder or unit   owner rules within the walls of their unit,   everything beyond the drywall—from the   wiring and pipes in the walls to the shared   common areas like laundry and fitness   rooms, to the exterior elements that hold   the building together and protect it from   the elements—is governed by the commu-  nity’s board under the aegis of its govern-  ing documents, which contain the rules   and regulations that cover a far-ranging   variety of issues and give the board au-  thority over different aspects of how the   building or association is run. Governing   documents are themselves regulated by   individual state laws and statutes, and at   times even local ordinances.   The hybrid nature of ownership pre-  sented by condominium and cooperative   homes gives many owners and sharehold-  ers a skewed or incomplete—and often in-  correct—understanding of who is respon-  sible for what in their community. This is   partly because few purchasers of condo-  minium and cooperative units ever re-  ally read the governing documents of the   community they’re moving into, and also   partly because many are coming from a   rental environment and wrongly see the   association or corporation board as their   landlord—which it most certainly is not.  Condos vs. Co-ops; Who’s in    Charge Here?  To understand the role and powers of   the board, it’s important to understand   the difference between condo and co-op   ownership versus single-family home-  ownership, as well as the difference be-  tween condos and co-ops themselves.  Single-family homeownership is very   simple: You buy a home and the land un-  derneath it. There may be some interface   with local governmental authorities for   provision of such necessary infrastructure   as utilities, roads, and basic services such   continued on page 9

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