The Perks of Continuity

If all successful marriages require work, it’s safe to say that all successful marriages that last for 40 years require a ton of work – as well as large helpings of communication, trust, and mutual respect. A sense of humor doesn’t hurt.

That has been the recipe at 230 East 71st Street, which was converted from a rental to a co-op in 1979 and still has two of its original board members as well as its original management company, Buchbinder & Warren. Like any marriage, this one has experienced bumps over the years, and there have been occasional whispers about seeking a divorce. But the bond endured, and it’s still strong as it enters its fifth decade. This 60-unit prewar building could serve as a poster child for the benefits of continuity and institutional memory. Bob Booher, who served on the tenants’ negotiating committee and still sits on the co-op board, sums up the key to the success of this marriage: “In our case, familiarity breeds admiration.”

A Different Option

Rosemary Paparo was a twentysomething with some property management experience when she got hired by Buchbinder & Warren in 1977 and assigned to manage the rental property at 230 East 71st. “It was a different city,” says Paparo, now 69, who grew up on the eastern end of Long Island. One difference, she says with a laugh, is that “anyone who could read and write could get a job in property management.”

A much more serious difference was that the then-president of the United States had recently suggested that debt- and crime-plagued New York City should drop dead. While the Yankees were playing in that year’s World Series, the Bronx was burning. The Arab oil embargo had caused the price of heating oil to spike. Residents were fleeing the city, and many landlords were either torching or abandoning their money-losing buildings. Others, desperate to find renters and turn their properties around, began to explore a different option.

“People were just starting to think about converting these rental properties to co-ops,” says Paparo. Two of those pioneers were her bosses, Norman Buchbinder and Gene Warren, native New Yorkers who were determined to help their city survive those tough times. They managed the building on behalf of the owner, Eight Associates, in which they were also partners, and they offered the renters at 230 East 71st the chance to buy their apartments as part of a non-eviction plan. This meant that residents who did not opt to join the co-op could continue to rent.

Booher, a commercial real-estate broker, was joined by his neighbor Eileen Russell, a documentary filmmaker, on the tenants’ committee that negotiated with the sponsor. Across the table sat Buchbinder and Paparo. person. His word was his bond. That set the tone for the relationship between the management company and the co-op.”

(Norman Buchbinder died in 2007, and Gene Warren died in 2017. Today the company is headed by Buchbinder’s daughters, Susan and Lori.)

Booher corroborates Paparo’s assessment. “Norman Buchbinder was largely regarded as a straight shooter and an honest guy,” he says. “He and Rosemary were very honest and direct, and we all got favorable terms.”

Russell, who joined Booher on the co-op’s first board, adds: “Norman would never argue. He would explain things. He wasn’t one to push your buttons, and he wasn’t interested in making the last dollar. He wanted the building to run well as a co-op.” Under the conversion plan, Russell was able to buy her one-bedroom apartment for $21,600. Today, property records  show, one-bedroom units in the building sell for $550,000 to $590,000.

A Co-op Is Born

Thus the co-op was born in December 1979 – and then the learning began. The fledgling board’s first task was to hire a management company, and given the tenor of the conversion process, there was little debate. “There was never any doubt we wanted to continue being managed by Buchbinder & Warren,” Booher says. “Some management companies had slick marketing, and I talked to boards all over the neighborhood.” He discovered that self-managed buildings tended to be disasters, that big management companies often neglected smaller properties, and that many of the new management companies then popping up were staffed by inexperienced people. Buchbinder & Warren presented none of those liabilities, and since the sponsor retained ownership of 10 apartments, it was in Buchbinder & Warren’s interest to make the building run well.

But there was another reason for keeping the marriage intact. “Rosemary was very competent,” Russell says. “She knew what to do, and she responded to your calls. She’s very smart, she knows what’s going on, and you can’t put anything over on her. Which is what we wanted.”

After two years on the job, Booher adds, “Rosemary knew the mechanics of the building, and she had a positive relationship with the super. She attended every board meeting. She was always available. And she grew with us.”

Paparo would manage the building until 1984, when she left on a 10-year stint as a consultant before returning to the company, where she’s now director of management. She also eventually resumed her position as the sponsor’s rep on the seven member board.

She remembers those early years as a time of navigating without a lot of maps. “We were all young, and we had to educate ourselves,” she says. She attended classes and seminars put on by law firms, she developed a network of lawyers and accountants she could turn to for advice, she pored over offering plans, and she became an early reader of Habitat magazine, which debuted in May 1982, 37 years ago this month.

Co-ops were so new in the city’s real estate world that Paparo got calls from more than a few lawyers who had a question: “Are these co-op conversions a scam?” And whenever Russell’s fellow shareholders wondered if they should call the super or the landlord about a problem, she recalls, “I had to explain to many of my neighbors that we were the landlords now.”

Selling a Flip Tax

As the co-op found its legs, the board tackled numerous improvements to the handsome, 1920s vintage, six-story brick building – two boiler replacements, roof and window replacements, elevator repairs, plumbing upgrades, facade work, security cameras, a new sidewalk, refinancing the mortgage. But the most telling project may have been the institution of a 1 percent flip tax in the late 1980s. With the city stabilizing and real estate values rising, Russell began promoting a flip tax as a way to operate without raising monthly maintenance or levying assessments.

“The board asked Buchbinder & Warren to send around a flier,” Russell says, “and take a poll and see if people wanted a flip tax. People who were planning to move didn’t go for it.”

Undaunted, Russell made a list of all the people who voted no, then she went to work. “I knocked on every door,” she says. “Most of us are working professional people, and most of the people stayed for 20, 30 years, or more. All I had to do was talk to them managing company are a good fit. “A big management company isn’t necessarily best for a co-op like ours, with talented people on the board who are willing to do some of the legwork,” Booher says. “A big company is not going to put a senior person on a building like ours.” He adds that he knows everyone on the staff at Buchbinder & Warren, and the coop’s current manager, Dawn Harris, is just the third in the co-op’s history. That’s a good definition of continuity.

Despite the good fit, there has been occasional talk over the years about ending the marriage. “People on the board have talked about looking at a different management company and maybe saving some money,” Russell says. “But when I looked around, I heard horror stories. We knew we were lucky, so we decided to stay with Buchbinder & Warren.”

Booher adds: “We’ve had overtures from other managing agents. But when you look at Buchbinder & Warren’s depth of experience taking care of an older Upper East Side building that is not considered luxury, they stand out.”

Paparo, for her part, understands that the urge to stray is part of many marriages. “There’s always the reality that no matter how long your relationship is with a building, there’s a chance people will want to change,” she says. “We do the same thing with our preferred vendors and contractors. You have to keep your eyes open.”

Growing Together

And so, with eyes wide open, this marriage marches along toward its golden anniversary. It’s a natural time for both parties to reflect on what has kept them together so long – and what might be missing from relationships between other boards and management companies.

“A board works best when power doesn’t sit with one or two people but is shared among many,” Paparo says. “I’ve worked with a lot of boards where people have their own agendas, promoting this cause or that cause. Eileen and Bob look at the big picture of what’s best for the building. Beyond that, we’ve always tried to be a good source of information for them. We say: ‘This is the problem as we see it. This is the option we recommend, and why. But it’s up to you to decide.’ We put in the grunt work, and we try to guide them.”

Russell adds: “It’s all about listening to the other person. We listen to them, and they listen to us. And we respect one another.”

And Booher has his own theory about the secret to the success of this 40-year marriage: “It’s a couple of things. We got married young. And No. 2, we endured some of the roughest times in the history of this city together. We’ve grown together over the years. It’s not a complacent relationship. What’s remarkable is that both sides have mutual respect.”

The last time the co-op’s management contract came up for renewal, Booher asked his fellow board members if anyone had a problem with Buchbinder & Warren. “The answer,” he reports, “was no.”