FRESH BLOOD SAVES THE ALAMEDA, PART 1

Despite this, a year later, most of the people in the 78 residential units and ground-floor commercial space still thought they were facing nothing more serious than routine Local Law 11/98 façade repairs expected to cost about $250,000. But as construction crews soon discovered, years of low maintenance payments and shareholder apathy had come at a price. In 2006, the board announced that the cond-op's shareholders would probably be hit with several assessments for a laundry list of overdue repairs to the façade, roof, parapet, elevators, windows, plumbing and decorative "balconettes."

"As the need for more work was discovered, the board would send out an immediate memo saying there was going to be another assessment," says Scott Osman (at left), a marketing executive who moved into the building in 2001 and was elected board president in November 2007. "The board was being conservative, but the net effect on the shareholders was disorientation. You can't plan if you're getting assessments chaotically."

As the scope of the job kept growing and the cost kept ballooning, some of the shareholders decided to act. That decision would prove pivotal in saving the Alameda from continuing down a road that could have led to physical and financial ruin.

Anxiety in the Air

In late 2006, more than half of the shareholders showed up for an emergency ad hoc meeting. The air was thick with apprehension, distrust, and calls for change. The group decided to send a representative to sit in on all board meetings to provide oversight for shareholders. It also would put up a slate of its own candidates at the next annual meeting, in late 2007, promising to bring transparency and thorough financial analysis to the board's operations.

Until the election, Osman became the dissidents' eyes and ears at board meetings. "I was looking for detailed answers into what was happening," he recalls. "The treasurer couldn't provide them, couldn't tell me how much money we were spending on capital improvements. Eventually, I had to get answers from the managing agent."

The cond-op has been managed since 2002 by Midboro Management. Michael Wolfe, the company's president, got his back office busy answering Osman's questions. "We tried to be a referee," Wolfe says. "We prepared a very detailed accounting history, listing all the vendors, in order to give the board a picture of their financial health. But the real difficulty with this project was that there were underlying conditions that were so deep that they could not be seen by standard inspections. These were rare, unforeseen conditions," he says.

Glen Kennedy (at right), an attorney with a construction company, has served on the Alameda's board since he moved into the building in late 2002. He says the collegial atmosphere of past board meetings evaporated as the dissident group began speaking up. "[The dissidents] thought we were incompetent," Kennedy says. "But I don't think anyone acted in bad faith. We simply never knew what the extent of the work was going to be."

Unsafe at Any Speed

The central problem, as Kennedy and several others see it, was a breakdown in communication, which resulted in potentially disastrous inaction. For instance, architects drew up extensive lists of possible repairs in 2000 and 2002, but Kennedy says he knew nothing about them. It wasn't until 2007 that a Local Law 11 report from 2002 came to the current board's attention.

That report had been prepared at the old board's request and listed work that should be done over the next three to five years, says Wolfe, the manager, who adds it was drawn up before his company had been hired as agent and that he reviewed it when he was hired. "A Local Law 11 report at times contains work categorized as repair and maintenance and work categorized as unsafe. Unsafe has to be done immediately and repair and maintenance has to be done before the next cycle or sooner depending on need. That 2002 report did not list anything as unsafe that needed immediate attention." The report listed minor cracks in the south façade, among other items, and said "no conditions were observed ... as unsafe."

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