This column by Daniel Wollman https://gumleyhaft.wpengine.com/daniel-j-wollman/ appeared in Habitat Magazine, July/August 2016.
If a building does not have a permanent Certificate of Occupancy (C of O), it can cause problems in the future for residents who may want to do renovations. Boards need to work with management to ensure that documentation is always kept up-to-date, to avoid the following expensive correction.
The Challenge: Gaining a Final Certificate of Occupancy in Three Years
For several years, we have managed a pre-war building with about 100 units in an Upper East Side landmark district. An additional floor was added by the sponsor, increasing the size of two penthouse apartments. This additional work triggered the requirement to amend the Certificate of Occupancy (C of O) for the building. The sponsor had been renewing temporary certificates for several years, but always late. There was a series of open violations that needed to be cleared before a permanent C of O could be obtained. Because of this, apartment transfers became exponentially more difficult for shareholders. When the board refinanced its mortgage, a special provision was added requiring the building to obtain a final certificate in three years or the bank had the right to rescind the loan.
The Solution: Closing Over 50 Open Permits, Jobs, and Violations One-By-One
When the project to get a permanent C of O was taken on by Gumley Haft, there were over 30 open permits, 20 open job applications, and violations going back to pre-coop 1982. Our expediter arranged and oversaw a series of inspections and had a number of violations dismissed. We contacted shareholders who had completed renovations and had not closed their work permits, and got them to do so. Because many apartments had changed hands, the board had those permits reopened by an architect retained by the corporation. Sometimes, this included recreating drawings from scratch, getting those plans approved, and then finally closing out the permits. Because of the nature of the work involved, the entire project took about two years at a cost of nearly $100,000.
The Lesson: Make Sure Shareholders and Unit Owners Take Responsibility
Buildings should take the time to review their current alteration agreements with their manager, while the corporate counsel and reviewing architect should make sure all protections are in place. In addition, a document needs to be created that requires any shareholder/unit owner who does work that could affect the current C of O to be fully responsible for the reinstatement of the C of O with all required changes. https://gumleyhaft.wpengine.com/services/property-management/
About Gumley Haft:
Gumley Haft has excelled in property management for New York apartment buildings since 1989. With in-depth expertise in New York real estate, local laws, financial management, and construction management, Gumley Haft guides boards of cooperatives and condominiums to become decision-makers. We recognize that each board is unique. What may work well for one may not be the answer for another. When you work with Gumley Haft, our team structures a five-point customized plan for your building. We bring the same level of excellence to residents from the Financial District to Park Avenue, Greenwich Village to the Upper West Side, in a wide variety of markets. Our services extend to property management of buildings of less than 100 units to properties with over 300 apartments. Whatever the size of a building or challenges in operations, Gumley Haft is experienced in day-to-day management, to solving complex building needs from finance and construction to resident issues. We provide reliable leadership for some of the most desirable buildings in New York.