Assessment or Common-Charge Hike? How One Condo Paid for Its 10-Year Plan

With three of the board's nine seats controlled by the sponsor, the six elected condo-board members had to make a crucial philosophical decision. Board president Panos C. Adamopoulos and his colleagues — a sales executive a dentist, a doctor, a chiropractor and a retired businesswoman — agreed that the smart way to pay for the looming capital improvements was through assessments, not hefty annual maintenance increases.

Adamopoulos explains the thinking this way: "I can spend my own money any way I want to, but I have to be three times as careful when I'm spending someone else's money. It's a very important word we have to keep in mind — the economics of every project."

Common Cents

More significantly, he says, "We didn't want to increase common charges to pay for these projects because we felt that would hurt apartment sales," Haynes explains. "We felt, after much soul-searching, that an assessment for each job would keep common charges down and keep our reserve fund healthy. We could also show people exactly where their money went." 

We could show the

homeowners exactly

where their money went." 

Adds Adamopoulos: "An increase in common charges is permanent. It can't come down once the project is finished. But if we need $100,000 to replace the boiler, we can assess all 100 apartments $100 for 10 months, and the project is paid for without a [permanent] increase. There might be people who can afford up to a 10 percent increase in common charges, but we might force other people out of the building because they won't be able to afford to live here anymore."

With assessments covering the costs of capital improvements, the board has been able to keep annual common charge increases below the rate of inflation, in the range of two to three percent. 

In addition, it saw the sponsor fade away as a force in the building. As operations improved, apartments began to sell briskly. The sponsor, occupied with other real estate deals, sold off all but a few of his apartments. "He got his money and got out," Adamopoulos says. 

A Team of Pros

Adamopoulos gives much of the credit to his managing agent, Andrea Bunis, president of Andrea Bunis Management. "Andrea is involved in every project, no matter how big or how small, at no extra cost to us," he says.

Bunis — who has been known to level harsh words at "frustrating" boards with private, unprofessional agendas such one she repped where the president wanted to challenge a restaurant lease because he didn't like the food — has high praise for the folks at 240 East 46th Street. "They don't make decisions off-the-cuff. They listen to the upsides and the downsides, they listen to the unit-owners and their professionals and then they make a decision."

This virtue came in handy when it was time to replace hallway carpets and wallpaper — a job that has the potential for unholy howling. To short-circuit complaints, the board showed sample carpets and wallpapers to unit-owners and let the majority choose. It then installed those choices on one floor and let unit-owners see the results before finishing the job. Bottom line: new hallways, no howling.

"We're flexible," says Adamopoulos, noting that he votes on issues only when he's needed as a tie-breaker. "Why fight over a tree or a light bulb? No, we don't want that. There's no need for petty misunderstanding and egos. The majority decides and the minority follows." 

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