Smoothing Over a Bumpy Management Transition

A midsize condominium building in a prestigious Brooklyn neighborhood had been so poorly run by its management company that it was on the cusp of ruin. Some service providers were threatening legal action for nonpayment of bills. The building was in disrepair, and there were thousands of dollars in uncollected common charges. Worst of all, the property manager was doing nothing to turn the property around.

The board, understandably, decided it was time to change management companies. When the new manager, Arlene Waye, principal of Awaye Realty Management, arrived on the scene, she was expecting a routine transition. She was in for a shock.

“The outgoing management company refused to meet and conduct an orderly transition,” Waye says. “It failed to provide building financials, service contracts, and other pertinent records.”

Waye and the board had no choice. They put together a transition team to procure and piece together the necessary documents. Once the building’s records were in order, it was time to deal with those unhappy vendors, the uncollected arrears, and the building’s sorry physical condition.

“We were able to negotiate settlements and payment plans with service vendors to address open maintenance issues,” Waye says. “We aggressively pursued residents in arrears and took legal action where necessary, ultimately restoring thousands of delinquent funds to the building’s operating account. Furthermore, we diligently digitized all building records and documents, and established online payment systems ensuring easy tracking of building processes and residents’ payments.”

Transitions between management companies are usually routine affairs, with the outgoing manager cooperating with his successor in a professional manner, passing along billing records, access to accounts, and other vital documents. But as this Brooklyn condominium illustrated, one uncooperative manager can gum up the works. In such cases, boards and their new managers can expect a messy and unpleasant ordeal. The best way to avoid this, of course, is to hire the right management company the first time around.

“Transparency is everything,” says Waye. “In hiring a property management company, the board must be confident that it’s selecting a qualified firm that utilizes the most up-to-date building management software and practices.”

Unfortunately, it’s impossible to predict the future. When it comes to knowing how that management company will handle a transition, boards can only hope for the best.