Don’t Risk Fines: Follow Rules Regarding Short -Term Renters

Many buildings have encountered issues with short-term rentals by unit owners, through websites such as airbnb.com. Some owners have listed their apartments and host a steady stream of visitors staying for a few nights or a week at a time. This can be a lucrative business for anyone with prime New York property who doesn’t need to live there on a daily basis, but it is also illegal. Such rentals violate New York City’s Multiple Dwelling Law, which bans rentals of less than 30 days, unless the unit owner or leaseholder is also staying there. They also violate the City’s Real Property Law, which requires that renters get the landlord’s consent before taking in a sublettor.

In addition, short-term rentals are against the house rules in most buildings. Many co-ops and condos have implemented rules specifically prohibiting this type of rental. Some have levied large fines for breaking the rules. “Our condo nes owners $1,000 for listing their apartments on airbnb.com or operating a similar type of rental business in their units,” says one Midtown Board President. “This new policy seems to be working. Before we had this penalty in place, some residents were literally renting out their units every night of the week, resulting in a parade of unknown individuals coming in and out of the building.”
If your building is grappling with the short-term rental problem, be sure that rules are put in place, fines are implemented, and residents are informed of the new policy. In most cases taking such action will solve the problem.

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Short-term renting is a tempting form of income for apartment owners. But it is also illegal. Board should put rules and fines in place.

Are You Eligible for a Real Estate Tax Abatement?

We are beginning our annual Co-op Tax Abatement filing for 2016/2017, and are submitting data on all of our new shareholders who purchased from January 6, 2015 to January 5, 2016. This is also an opportunity for any shareholders whose resident status has changed to primary and currently meet the requirements for New York City’s co-op tax abatement program. Any shareholders who feel that the City’s Department of Finance erred in declaring their unit ineligible for the abatement can also reapply at this time. Please contact your Account Executive in writing stating that your unit is your primary residence as of January 5, 2016, and we will submit your information. The filing deadline is February 15, 2017. For more information visit http://bit.ly/cooptaxbreak
In addition, there have been some changes in the STAR abatement program. New applicants who qualify for Basic or Enhanced STAR will now register with New York State instead of applying with the tax assessor, and will receive a STAR credit in the form of a check, rather than a property tax abatement.
New applicants who qualify for Enhanced STAR do not need to register separately to receive the Enhanced benefit if already registered to receive the Basic benefit. When
registering for the STAR credit, the Tax Department will automatically review each application to determine eligibility for the Basic or Enhanced STAR. For further information on the STAR abatement program and how it could benefit you, visit http://bit.ly/STARabatement.

Avoiding Noise Disputes

Most of us live with neighbors a mere few feet above and below us and possibly even a few inches from side to side. It’s likely that at some point we’ve had noise issues, even though we tend to think of ourselves as the ‘disturbee’ rather than the ‘disturber.’ All multi-unit dwellings have established rules that boards and managers work hard to communicate to all residents, and enforce throughout the property.

“Our building requires that 80 percent of all apartment floors are covered with carpeting or area rugs,” says one East Side Board President. “If you choose to have exposed hardwood floors instead, owners can install foam or other sound insulating material between the underlayment and the flooring.”

Boards and managers need to be sure that all residents are aware of the house rules regarding noise. This includes sound abatement requirements as well as neighborly basics such as “quiet hours.” Many buildings request that noise levels from parties, music, television, etc. be kept to a minimum after 10 pm, for example.

Circulating a list of house rules periodically to all residents—including both unit owners and sublettors—is a wise idea. Informing residents of scheduled renovation work or other contracting jobs can also help minimize the impact of short-term noise from such projects. For example, if a building resident is planning to do redo their kitchen or install a new bathroom, let the neighbors know the expected dates of the work, so they will be aware that there will be some noise and inconvenience, but they’ll know that it won’t last too long. Or if the building or the City needs to do some sidewalk or street work out front, requiring jackhammers, let residents know what timeframe to expect. It’s easier to live with a noise problem if you know it’s temporary.

By ensuring policies are disseminated to building residents and addressing noise complaints via a clear and open line of communication, managers and boards can minimize the sort of disturbances that upset people living in our properties.

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Most of us live with neighbors a mere few feet above and below us. It’s likely that we’ve had noise issues at some point.

 

We Welcome New Properties to Our Portfolio

By Jim O’Connor, President

Dozens of properties have joined the DEPM portfolio in the first few months of the year, and we are delighted to welcome them to our unique brand of property management, enhanced by the wealth of knowledge we have gained in more than 100 years of service.

We are thrilled to welcome so many new properties into the DEPM management portfolio. There’s no question that what sets our service apart from other companies is our people. We have the best managers on our team, and they stay with us for years; sometimes for decades. A full 180 of our 240-plus employees have been with the company for over 15 years. Along with our recent growth, we have hired a number of excellent new managing agents who have been blending in beautifully with our existing team.

Just last month, Co-op City, the largest cooperative housing development in the world, brought DEPM on board to help manage the 15,372-unit property, consisting of more than 35 high-rise buildings on 320 acres in the Bronx.

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Welcome Co-op City! The largest cooperative in the world recently joined the DEPM portfolio.

Located in the East 50s overlooking the East River, 25 Sutton Place South also recently switched to Douglas Elliman Property Management. Built in 1959, the 320-unit co-op is perched above the FDR Drive, providing unobstructed river views, as well as a beautifully landscaped garden where residents can sit and enjoy the outdoors while watching the passing boats.

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Welcome 25 Sutton Place South, a 320-unit co-op on the East River.

The range of new properties that have joined the DEPM portfolio runs the gamut from luxury pre-war properties like 1160 Park Avenue to new buildings on the far West Side and Downtown; from the Bay Club Condominium in Bayside, Queens to the leafy townhouse enclave of Brooklands in Bronxville.

While the DEPM management team is proud of the current growth of our organization, we are equally proud of the long-term relationships we have maintained since the company was founded in 1911.

One of our oldest clients is 911 Park Avenue, where Board President Michael Rankowitz says, “In the 51 years that Douglas Elliman has managed our property, we have always been impressed by their professionalism and attention to detail. While much has changed since 1965, one thing we can always count on is that our Park Avenue co-op receives the service and attention we need from our management team.”

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911 Park Avenue has been with DEPM for over 50 years.

As one of the City’s largest management firms, DEPM provides central purchasing of supplies, insurance and energy to help our clients control costs. Each building is assigned a financial analyst to work on budgets and investments. The firm offers mortgage, closing and brokerage services through its other divisions. But above all, it is our breadth of experience and longevity in the business that truly sets DEPM apart. For more information, contact me directly, DEPM President Jim O’Connor at 212-370-9200 or info@ellimanpm.com.

 

Annual Meetings Bring Board Elections

Spring is Annual Meeting season, and that means board elections are coming up. If any of your board members plan to step down, it’s important to find replacements so that the board is able to maintain a quorum and make decisions as needed.

The current board and manager should canvas residents to see who might be interested in joining the board, so their names can be put on the ballot. Each new candidate should put together a short statement telling residents a little about themselves and why they want to be a board member. These statements should be distributed at the Annual Meeting when it’s time to vote for the new board. They can also be circulated in advance. Current board members who are running for reelection should also submit a statement, to be sure that all unit owners are familiar with their background and qualifications.

Communication between current board members and unit owners in advance of the election is crucial in ensuring that your building’s board of directors has a full slate of committed members at all times. As board make-up changes, it’s important to maintain continuity and quorum so that the decision-making process can continue to move ahead without interruption. By planning ahead, your annual elections should run smoothly and without incident.

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If any of your board members plan to step down, it’s important to find replacements so the board can continue to make decisions as needed.

Continuing Education Keeps Managers Current

Given the constantly changing Local Laws and regulations in New York City, and the stream of new technology hitting the market, property managers must keep abreast of trends in their field. We understand exactly what our clients need to remain in compliance and up to date. And we make sure that all of our property managers and their support staff stay current on these issues by holding bi-monthly In-House Training Seminars.

It is this kind of attention to detail that separates the people at DEPM from other managers—they are constantly being educated right in our office so that they can remain at the top of their game, and protect the properties they manage.

At prior seminars, we have brought in experts to discuss the oil-to-gas and “dirty” fuel to “clean” fuel conversion process, best practices for cost-effective façade maintenance, updates on our new accounting and streamlined bill-approval systems, and how we can help our clients save hundreds of thousands of dollars in fuel costs.

During our in-house seminars, managers are given the opportunity to question engineers, architects, expediters, accountants and other professionals brought in to teach, helping them understand the many requirements and options that affect their specific properties. In turn, they can pass along this hands-on knowledge to help boards make informed decisions, stay on budget, save money whenever possible, and avoid fines and violations.

At DEPM, we take great pride in ensuring that our entire staff—both in the office and on premises—has the expertise and education needed to run your building as effectively and efficiently as possible, to enhance both the quality of life and the value of your property. This is one of the reasons why more properties than ever are trusting DEPM with their management services.

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DEPM President Jim O’Connor MC’s our Managers Seminar Series, ongoing in-house education for our managers.

 

Unique Hands-On Approach to Management Draws Properties to DEPM

By Jim O’Connor, Douglas Elliman Property Management

In the 30 years I’ve been at Douglas Elliman Property Management, I’ve seen a changing business. With the price of properties here in New York City hitting astronomical levels, new owners are coming in spending millions of dollars for their apartments and bringing different expectations of service. We have to address that need, while also being sensitive to those who have been living here for decades, many of whom take a more traditional approach to management. In addition, Local Law requirements, inspection regulations, the tax code and other considerations are as ever-changing as the City skyline.

In the past year or so, dozens of new properties have come to us for their property management needs. In 2015 we added nearly 20 new properties to our management portfolio, and we already have two dozen additional buildings starting with us in 2016. Why? Because of our unique hands-on approach to management, our dedication to service, the firm’s exclusive focus on property management, the longevity of our company and staff, and the continuity that affords.

Founded in 1911, DEPM manages over 350 buildings and almost 50,000 apartments. Our portfolio includes every type of property from Mitchell-Lamas to rent stabilized units to luxury properties on Fifth, Park and Central Park West, to newly constructed downtown high-rises. We manage properties in four of the five boroughs, Westchester and Long Island.

Our Services

One of the reasons that DEPM has such a fine reputation in the City is our extraordinary staff and the resources we bring to bear on a daily basis on our clients’ behalf. Because of our size, our central purchasing allows buildings to save significantly on supplies: between five and fifteen percent compared to other companies. Our closing department is staffed by 14 people and handles over 4,000 transactions a year—sales, sublets, lease changes, etc. Each of our buildings is assigned a financial analyst who works with the board and treasurer to produce budgets on an annual basis, review monthly financials, and provide cash flow statements so properties can plan their expenses twelve months out. We have special relationships that provide our clients with competitive mortgage refinancing; we’ve refinanced over 100 buildings’ underlying mortgages in the last five years.

Our energy management department aggregates the energy needs of our properties—fuel oil, natural gas, and electricity—and shops these on a regular basis, resulting in savings for our clients of over $3 million a year for the last three years. We also purchase insurance for our buildings through two competing master insurance programs, each of which offers an umbrella liability plan of $150 million aggregate per building, offered at competitive premiums.

Our Experience

As an established company that’s been in the forefront of New York City property management for over 100 years, our experience with issues and solutions are second to none in the industry. Steam leaks, floods, gas leaks, water tower collapses, we’ve seen it all. As a property manager, you hope it doesn’t happen, but it’s our job to be well prepared to deal with any situation or crises that arises in our buildings.

As you might imagine, most building emergencies don’t happen 9:00 to 5:00 Monday to Friday. We have a trained Emergency Response Team. They come on after 5 o’clock, and they carry what we call “The Bible,” which is the emergency contacts for not only everyone at each building, but for the home numbers of all the vendors that service our buildings. In addition to doing the basics—making sure that everything is tied down, that all the drains are clear when a storm is forecast—in the event that something goes wrong, we know who to call and when to call them.

We’ve gone through Hurricane Sandy where we had buildings wiped out by the storm. We had buildings that had water go through their lobbies, damaged buildings that were uninhabitable for months afterwards. But we worked with our boards, our owners, FEMA, and the insurance companies to get these buildings up and running. It was a staggering accomplishment, which took much longer than any of us wanted. People were without their homes for a significant length of time, but we got it done. In all these years, the monumental task of rebuilding after Sandy was easily the greatest challenge we ever faced.

Our People

Part of what makes us one of the leading companies in the City is our people. We have property managers with a wealth of experience who have been with DEPM for an extraordinary period of time; some managers have been assigned to the same buildings for over 20 years. Fully 180 of our 240-plus employees have been with us for over 15 years. That kind of continuity is unknown in our business.

I’ve gone to work for the last 30 years with the greatest collection of professionals that anyone could ask for. I truly wouldn’t change anyone in our company for anyone else in the industry. This place is unique in that respect: people like property management here. And people like working with each other here. That’s a testament to the type of people we have and I wouldn’t trade it for the world.

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“I truly wouldn’t change anyone in our company for anyone else in the industry,” says DEPM President Jim O’Connor, pictured here with Vice Presidents Peter Lampen (center) and Elly Pateras.