The (Really) Big Apple Managing Extra-Large Properties

The (Really) Big Apple

 If you lived in New York in the summer of 2003, chances are you know exactly  what you were doing on Thursday, August 14th, at 4:15 in the afternoon. That’s when the ripple effects of the failure of an Ohio power plant caused most of  the Northeastern United States and Canada to plunge into darkness. Well, it  plunged into darkness where this reporter was—the windowless men's room of a Rockefeller Plaza office building. Fortunately, the sun was still shining, and I was already washing my hands.  

 Residents of North Shore Towers, however, a residential complex of three  34-story towers on the eastern extremity of Queens, were unaware that anything  was wrong. North Shore Towers manufactures its own power at its own co-generation plant—how’s that for an amenity?—so outages that disrupt the rest of New York have no effect there. While  darkness fell on the rest of the city that August evening, North Shore Towers,  already tall and built atop the highest natural point in Queens, shone like a  triple beacon.  

 “During the blackout, people knew to come here,” says Errol Brett, an attorney and the longtime general counsel for North Shore  Towers. “It was hot, and they came for the air conditioning.”  

 Cities-Within-Cities

 The night of the blackout made clear what had long been obvious: North Shore  Towers is not your average co-op. It is, in effect, its own municipality, with its own zip code, its own movie  theater, its own shopping center, its own library—and a $45 million-a-year budget. And while managing such a property requires dealing with issues that all  property managers contend with—noise complaints, internecine squabbling, late maintenance fees, and so forth—the job, like the property, is much bigger.  

 “In effect, we’re a small city. We have issues with vendors, with city, state, and federal governments, with  running the power plant,” Brett explains. “It’s not just waiting for a call that Mr. Smith is making noise, and Mr. Jones is  getting angry. But we get those as well.”  

 As with any small city, the scale of the operation places even more importance  on the governors—in this case, the board. North Shore Towers has nine directors on the board, each of them the chair of a  subcommittee that focuses on a specific area. The subcommittees each have 10-15 members. So a number of the some 3,500 residents are directly involved with managing the  property.  

 The committee structure is peculiar to extra-large properties like this one. Indeed, “I’ve never seen it in any other building,” Brett says.  

 The election process is also unlike what is found at smaller co-ops. The board members serve staggered terms to ensure consistency and preparations  for the yearly elections, held the third week in June, begin in April. Candidates apply, and their resumes and photos are posted on the internal  website. There is a candidate orientation (which tends to scare off anyone not  serious about the job), followed by a candidate night at the movie theatre,  where the candidates make speeches and field questions from residents in the  audience. This is simulcast on the closed-circuit North Shore Towers TV station, and  re-run often until election day. The election itself is run by an outside firm, American Arbitration, to ensure  fair results.  

 The formal procedure “eliminates a lot of turmoil,” Brett says. In many other buildings, the election is held at the annual meeting, which “isn’t about who’s running for office, it’s people complaining—this eliminates that.”  

 North Shore Towers is managed by Glen Kotowski, a former deputy inspector with  the NYPD, who Brett calls “the greatest manager in the city of New York.” He also speaks highly of the board members, and the shareholders in general,  whom he describes as “extremely sophisticated.” Good relationships with the other members of the team is critical in running a  ship as big as North Shore Towers. And that centers around three components: “Communication, information, and education is our goal,” says Brett.  

 The fact that the complex has its own movie theater, shops, professional  offices, and arcade area make this easier. Although the place is large, it is in some ways more closely-knit than other  co-ops. “We have a very vocal community,” says Brett. “Everybody knows everybody else.”  

 Indeed, the most important difference between managing a small building and  managing an extra-large complex is “the management of the staff,” says Margie Russell, executive director of the New York Association of Realty  Managers (NYARM). “The financials, that’s all the same. Following laws and codes, that’s all the same.” The challenge, she says, lies in building and maintaining good relationships.  This sentiment is one you hear often when speaking with managers of massive  properties.  

 Russell equates the government of an extra-large-sized property to a military  organization: the integrity of the underlying structure is of the utmost  importance. She cites The Tipping Point, in which author Malcolm Gladwell breaks down the  numbers side of human relationships, determining that the number of  relationships within a system expand exponentially when new people are added to  the mix. In other words, having 50 direct reports is not particularly effective, because  it’s too many relationships for one person to keep track of..  

 “It’s about attention to detail,” she says, “and small groups. Most people don’t realize how important that is in a large property.”  

 Anchoring Chelsea

 Another example of a mega-co-op with its own management and sense of community  is Penn South—or more officially, the Mutual Redevelopment Houses—in Chelsea on Manhattan's West Side.  

 This co-op sprawls from 23rd to 29th Streets between Eighth and Ninth Avenues,  and is home to between 4,000 and 5,000 residents in some 2,820 apartments.  

 “It’s like a small city within a city,” says Brendan Keany, Penn South’s general manager. “We are unique by virtue of our size and are very community-oriented." Keany  notes that Penn South has a uniformed security force, a staff of over 100  employees, its own power plant (which also enabled the development to have  uninterrupted power during the blackout of 2003), a community garden, a gym, an  extremely active seniors' program, a group of stores and restaurants on the  premises, and even a theater.  

 The co-op interacts with its surrounding neighborhood as both a community anchor  and an advocate, says Keany. "The Penn South board is involved with their local  community board, as well as an organization called the Coordinating Council of  Co-ops (CCC), in which we have sister members throughout New York City and the  five boroughs.” The CCC allows cooperatives to work on co-op related legislative and legal  issues, says Keany, and in addition to their CCC involvement, Penn South  residents joined a number of other local organizations in a successful effort  against the proposed West Side Stadium project a few years back. They are very  active in their local police precinct, with a number of shareholders attending  the 10th Precinct Community Council that meets monthly. "This allows  shareholders to bring local community problems to the precinct on the spot,"  says Keany, "[as well as] giving them face time with the powers that be and the  local police department.”  

 When a development the size of Penn South needs big repairs, it's a major  undertaking, says Keany. Because the co-op is now nearly 50 years old, there  have by necessity been some major capital improvement projects over the last  decade or so. In the mid-1990s, for example, the buildings' windows were all  replaced at a cost of about $11 million. In 2003, Penn South's underground  electrical cables, which also had deteriorated, were replaced, a project that  Keany said cost about $5 million.  

 Being self-managed allows Penn South to be flexible and operate almost like a  distinct municipality, says Keany. “We generate our own electricity, completely devoid of Con Ed and have been since  1986,” he says. “We’re like a-city-within-a-city. We have 110 professional employees, an 800-spot  parking lot on the property, approximately 20 retail ground floor spaces that  we rent out, the Midtown Tennis Club, St. Vincent’s Clinic, and our own gym with over 500 members. The diversity of things you can  get involved in are much greater when you are self-managed.”  

 Big in Brooklyn

 On that dark August night in 2003, the lights were also on at Brooklyn's  Amalgamated Warbasse Houses. “Houses” is a bit of a misnomer—these are five 24-story buildings on a 26.7 acre lot in Coney Island. With 2,585  units, the Amalgamated Warbasse Houses—a New York State Mitchell-Lama housing cooperative—constitute an even larger co-op than North Shore Towers. First occupied in 1964, they are also older than their Queens counterpart.  

 In complexes almost half-a-century old, things start to break down. This is the most exigent concern of the building’s longtime manager, Rochelle Captan. “There’s leaking pipes, there’s replacement of pipes—huge things a 46-year-old building has to face,” she says. “Fortunately, we have some wonderful people who work for us.”  

 Like Brett and Kotowski in Queens, Captan enjoys excellent working relationships  with those she does business with every day. “Good relationships with the board of directors—that’s very important,” she says. “The people I’ve dealt with have been extremely bright and kind and nice. We can talk, we can  analyze.” As for the president of the board, “I don’t know what I’d do without him.”  

 Like Russell, Captan understands that good relationships need to occur up and  down the hierarchical pyramid, and not just laterally. “It’s very important to have a good staff,” she says. Her employees, she says, are “caring and wonderful. I think we have the best staff we’ve ever had.” She’s been at the helm of the Amalgamated Warbasse Houses for 32 years, so that’s no faint praise.  

 Extra-large properties tend to have many commercial vendors, adding yet another  wrinkle of complexity to the face of the difficult job. Amalgamated Warbasse  Houses features a bank, a grocery store, a deli, and an array of medical  professionals, among other things. Does this pose problems? No, says Captan. “They are excellent people. There are no challenges at all.” The main issue is making sure not to let space to more than one of a given  line. The property can’t accommodate two eye doctors, for example.  

 The ability to manage relationships bleeds into dealing with the residents, too. There are a staggering 8,000 of them at Amalgamated Warbasse Houses—one one-thousandth of the entire city. In effect, the property is a microcosm of the five boroughs of New York. Which means the residents really do run the gamut.  

 When asked for funny anecdotes about her decades as property manager, Captan  says, “I could write a book.” But she stops there. She won’t name names or tell stories. “But I will say this: there’s a lot of very strange things happening all the time.”  

 Like New York City itself, super-sized co-ops and condos are mosaics made up of  all kinds of people from all cultures and walks of life. Managing these types  of properties is much like managing any other residential development, just on  a much larger scale. At the end of the day, competent management and a strong  sense of community are what keep the city's giant developments running smoothly—and that's true regardless of size.    

 Greg Olear is a freelance writer, novelist and a frequent contributor toThe Cooperator.

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