HOW — AND WHEN — TO FIND A NEW MANAGING AGENT

Many people with experience in the world of New York co-ops and condos will tell you that hiring a management company is a bit like getting married — and advise that it's always wise to learn as much as possible about your spouse-to-be.

What are the steps you need to take to ensure that you find the right partner and that your management marriage doesn't end in divorce?

First, look for warning signs that it's time to switch agents. Greg Carlson, executive director of the Federation of New York Housing Cooperatives & Condominiums, says t he three most common complaints about managers are that phone calls go unreturned, to-do lists keep growing instead of shrinking, the board and the manager have incompatible personalities.

As for the big red flags, get concerned if:

1. The manager provides vague financial statements, without original invoices

"When we first converted to a condo, we didn't know anything and we were just trying to get our ducks in a row," recalls Mlott, a self-employed lawyer who has served on the board of the 138-unit condo at 222 East 60th Street for all but three of the past 23 years. "When we finally got settled, we started asking questions."

And the red flags started fluttering "When we got our monthly financial statements [from the management company], we were just seeing lump figures for a plumber, a carpenter, whatever," says Mlott. "We weren't seeing the original bills. When we asked to see the bills, I noticed that we were getting billed for things that the sponsor was using to fix his units, like new toilets and new floors. We had to demand our money back."

2. The manager makes surprise or unauthorized expenditures.

You don't want surprises in your budget. Take the sobering case of the Normandy, a 250-unit co-op on Manhattan's West Side. Some years ago, the board discovered personal expenses made out for the benefit of the building's longtime managing agent, including his car loans and automobile repair charges ($11,878), personal attorney fees ($32,318), a caterer for his wedding ($2,500), computer equipment and office supplies ($26,387) — and the topper: a "petty cash fund" over which the agent had sole check-signing power and about which the board had apparently been unaware ($85,280)! Needless to say, he was dismissed and sued.

3. The manager loses interest.

"I was surprised that after a while the managing agent who had served us so well suddenly stopped serving us well," recalls Paul Ross, who served on the board for 10 years, three as president, at the 234-unit co-op at 720-730 Fort Washington Avenue in the Washington Heights section of Manhattan. "There was a drop-off in service over a number of years. I think there's a desire by boards to stick with a managing agent because he has an institutional memory. But managing agents get bored, and their performance can slip."

Once the divorce is made final, what steps should you take to find the perfect partner? Among them:

1. Compile a list of possible management companies.

Management companies range from small — a single principal and a basic support staff — to huge — with several principals and more than a hundred employees. Compile a list of prospective new companies through word of mouth, talking to the board lawyer and accountant, reading industry publications, and seeing who manages nearby buildings.

During Ross' tenure as president, the co-op decided to get rid of the manager, who was also the sponsor, and bring in someone new. "We invited [shareholders] outside the board to come up with suggestions. We also did research in trade publications, looking at both articles and advertisements. We also spoke with the people at the Council of New York Cooperatives & Condominiums."

Ruth Shoenthal has worked both sides of the street. Since 1993, she's managed co-ops and condos for General Property Management Associates and is the treasurer of her 132-unit co-op board at 127 West 96th Street, where she's served for 16 years, including 10 as president. During that time, her building has gone through four management companies. "We all have friends who live in co-ops and condos, and [when we were looking] we asked around," she says. "If they were happy with their management company, we put it on the list."