While budget balancing or planning capital improvements may seem to be the most important skills within property management firms, managers will tell you their main focus is on human relations.
David J. Levy, president of Sterling Services in Holliston, Massachusetts, explains that for managers, the tough part isn’t the budget, of finding plumbers or roofers. “It’s much less about facilities than it is about people-management. It’s where we spend a lot of our time,” he explains.
And just as we come to trust our service professionals—our doctors, lawyers, counselors—with our closest confidences, condo board members often share their intimate desires, and viewpoints, with a trusted manager. However, this close relationship, managers admit, doesn’t necessarily translate to any special loyalty.
When trust is high, inhibitions may be down, and board members can be surprisingly frank. “I’ve had board members who are racist, misogynistic, homophobic… complaining about Hispanics or Jews,” Levy recalls. “I had an employee who was a lesbian and someone on the board questioned it. Another manager on our staff is Brazilian, and I have to be careful where I send her. The thing is, our firm has a number of condo properties with a major Brazilian population, so we have staff in the office and on the phone who speak Portuguese. I’ve actually gotten flak from board members, and even sometimes from (our own) employees, about ‘catering to a certain (ethnic) group.’ I’m just responding to whatever the community (reflects) and pick the top two languages that are used the most” in that community’s population.
As an example, Levy continues, “We picked up a property that is 25 percent Portuguese-speaking, so we created a bilingual project for all communications: the signage, condo docs, notices or newsletters… It’s a free service. But we’ve had some board members complain that we’re ‘enabling’ the residents. Ultimately, they will come around to a vote and support (the projects) I am promoting… but these attitudes can create friction. My biggest challenge is, how I plug in my staff people to the right properties.
“Most of the time,” Levy explains, “I deal with these issues (stemming from prejudice) privately, but if it’s completely overt, you have to let everyone know it’s out of line.”
“I had a board member,” he continues, “who was an Archie Bunker-type who would joke around (using) Jewish stereotypes, like getting a vendor to charge us less because ‘we can Jew him down’ … and I’m Jewish! He knew it, and would make comments like ‘let Levy handle the financials… he’s gotta be good at it,’ and things like that. It just amazes me.”
In addition to expressing derision about ethnic groups or lifestyles, some boards can be snobby. “We had a property that imposed a special assessment over $20,000, and some unit owners were really in a (financial) bind over it,” Levy relates. “There were board members commenting something like, “If you can’t come up with $20,000-$30,000 in six weeks, maybe you shouldn’t live in this community’.”
Then there are the trustees who expect special treatment. Levy says, “We were interviewing with an association once, and one board member owned an insurance agency, and her husband was in the landscape business, and they fully expected to automatically get the service contracts for the property. We felt (this client) was not a match (for our firm).”
Clearing the Gridlock
Doug Thayer, a principal at Thayer & Associates of Cambridge, Massachusetts, agrees with Levy that property management is more about people than facilities. “I’d say 80 percent of our job is human resources; we spend a lot of time on it.” He speaks from generations of experience, noting, “This has been a family-owned management company since the 1920s. We serve all types of communities throughout Eastern Massachusetts, with over 90 employees.” He says that boards can be as small as three or large as nine, but the most common size is five, and the majority of boards operate in a smooth, professional manner. But, he adds, “We also have some incredibly dysfunctional boards, where nothing happens because you cannot get a majority vote on anything. Sometimes, directors differ on interpretations of the bylaws, which can happen if the (condo) docs are too complicated—then they’re not workable.
“For instance,” he explains, “We took over a client property recently and immediately one trustee circulated a petition among residents calling for removal of another trustee. The bylaws in that community require over half the voting members to make such a change. The bylaws, however, call for a vote, and a petition is not a vote,” he points out, even if it gathered signatures from over half the unit owners. “This ousting of a board member is an extraordinary measure,” Thayer says, “although it’s happened (for our firm) a few times in the last couple of years.”
He advises boards to keep things in perspective. “On a condo board, you’re not a senator or a state rep. More importantly, you don’t always have to win… you’re just one of five members. If things don’t go your way it doesn’t make you a lesser person.”
To avoid board action gridlock, he explains, “Our approach is to get the board to appoint a single contact person to interpret what action the majority of the board wants to take and issue what they want us to do… in a written directive. Our goal is to make sure boards use Robert’s Rules and run a businesslike meeting with minutes to reflect decisions. Any communications outside the board meeting, and we will only deal with that single point of contact.”
Referring to the issue of board members with prejudices, Thayer admits that he’s encountered, “more problems with sexism. My daughter is a senior manager but some board members don’t respond (to a female manager). Some still live in the 1950s. I’ve even heard trustees at a certain property, when they’re interviewing staff, ask, ‘are you getting pregnant anytime soon?’ and come out with questions about age, family situation… not even realizing it’s inappropriate.”
Thayer describes a more serious board issue in which a trustee was receiving kick-backs from a vendor. “A manager realized what was going on and blew the whistle. This is one case that went to court, and the association won… they continue to collect on the judgment” that is paying out over a number of years.
A Two-Way Street
Justin Gargiulo is senior vice president at Great North Property Management, based in New Hampshire with several regional offices. He agrees that occasionally, “you’ll get a ‘rogue’ board member who has an agenda and wants the position because of something that affects them personally.” While disgruntled trustees are rarely a problem for management, Gargiulo notes that, “If there’s abuse, such as verbal abuse from a board member, we’ll step away (from that client). We had one property where a few of the unit owners were taking advantage of the manager, being abusive and making demands so that she was spending more time at the site than what was scheduled. We brought this problem to the board members, but the situation didn’t improve. We eventually changed the staff assignment on the account.
“When there is a complaint from trustees about (our) managers, I have a meeting with the board so they can speak freely,” he continues. “In one case last year, the board didn’t think the manager was meeting their expectations (so) we met with them and they voted to give that manager 60 days to work it out. The specific complaints included things like his level of expertise using the association’s software, but other things were a bit puzzling, such as asking that he ‘be more pro-active’ and certain details about the format for signing contracts, and the timeliness of imposing penalties for trash barrel infractions and other things. Plus, they wanted to review all correspondence. This borders on micro-managing and can really waste a manager’s time.”
Gargiulo regards this whole issue as an illustration of how “communication must be a two-way street between management and trustees. This manager had not gotten complaints from boards at other properties, and when we looked closely (at specific complaints) it was evident… that ‘timeliness’ often depended on board members themselves being more pro-active.
“When we are in the interview process (with a new board) we try to feel them out and find out why they’re not happy. We keep asking ‘what went wrong?’ to get them to share their real concerns. Sometimes, they will ask us afterwards, ‘Are you sure you want to get involved?’ but we rarely walk away (from new business).”
One frustrating aspect of board members’ behavior that Gargiulo has heard about when talking with other managers, is loyalty—or lack of it. “There doesn’t seem to be a lot of loyalty among board members, when they treat their managers like a commodity. One possible reason may be turnover on the board. Some condo docs require that trustees serve terms of only one year. In a case like that, with each new board, management has to keep reinventing itself.”
While “rogue” board members may be a headache for management, it’s the other board members who are probably most dispirited. Michael Phillips, chief operations officer at The Copley Group in Boston, agrees that most boards operate effectively — but when there’s a problem, “inevitably it’s at least one member who’s not getting along with the other members, or he or she is not being responsive. Or they are trying to direct the management company themselves.”
Phillips and other managers admit that when they are interviewing with a potential new account, “The board members have most often been honest about why they want to make a change,” even if the situation looks like it would be a tough challenge for any manager. He tries to approach a frazzled board like that with a solution and states, “When that’s happened, we laid out how we’d solve the problem before we got the contract.”
Marie N. Auger is a freelance writer and a frequent contributor to New England Condominium.