Hammering Out an Access Agreement With Developers

A neighboring developer needs access to your building. A recent court ruling says you’re entitled to licensing fees and attorney’s fees – sort of like a cover charge at a nightclub. How does your board make sure the developer doesn’t take advantage of you when he slips past the velvet rope?

“The first thing you do is ask for a copy of their plan, a description of what they intend to do and what they want from you,” says attorney Dani Schwartz, a partner at Rosenberg & Estis. “Then you would discuss with your attorney whether this is a serious access issue or not, whether it makes sense to get an engineer/architect or site-safety consultant. It may be that the plan is very intrusive and does not fall under the access statute, in which case the discussion may be over. Alternatively, if it seems that the plans are viable and more or less reasonable, it may make sense to get a construction professional involved.”

“You want to make sure your whole team has clear documentation early on that defines what’s being requested and what it’s being requested for,” says Gene Ferrara, president of the engineering and consulting firm JMA Consultants.

Attorney Steve Troup, a partner at Tarter Krinsky & Drogin, advocates bringing in an engineer/architect at the start. “You need to know exactly what will be going on with the construction, not just a general description,” he says. “You need to get your attorney and engineer/architect involved right away to participate in meetings and independently confirm exactly what [the developer is] planning to do, how it’s going to impact your building, and how long it’s going to take.”

Co-op and condo attorney C. Jaye Berger adds, “When the developer says to you, ‘Let’s not get lawyers involved,’ that’s a red flag.” She even recalls a situation in which the building owners who wanted access didn’t have an attorney. “And I made them get an attorney because I wanted to make sure I’m talking to someone who knows what I’m talking about.” Boards of small buildings should not let big developers push them around.

Whatever you do, says architect Howard L. Zimmerman, principal of his eponymous firm, a board member “should never engage in any conversation [with the developer’s representatives] other than, ‘I’ll get back to you.’ ”

Now that you’ve set the table, your board’s attorney and the developer’s attorney will hammer out the access agreement. This agreement should: specify working hours, duration of the project and fees; verify that your building and managing agent are named as additional insureds; set penalties if work lasts past the deadline; and lay out safety standards.

Once the agreement is set, Troup suggests, it’s prudent to have contingency money in escrow or a bond, “so if the neighboring owners default, there’s a pool of money that can be used to compensate the co-op or condo for its damages.”

There’s one overarching piece of advice in all this: don’t get greedy. “Remember,” says Ferrara, “this goes both ways. If you negotiate to get $10,000 a month, that may be what you have to pay the guy next door when you need access to his building. Keep it amicable.”

Zimmerman agrees. “Neighbors,” he says, “need to get along.”