Here's a New One: a Monthly Fee During Renovation Work

Without consulting shareholders, an Upper West Side co-op board has quietly implemented a $1,000 fee – to be charged once a month for the duration of every apartment renovation project. The board instituted the fee two years ago and mentioned it, in passing, at this year’s annual meeting with shareholders. When questioned about the board’s power to impose such a fee, the managing agent replied, “Everyone’s doing it.” Is this true? 

“Some alterations go on for a long time,” attorney Phyllis Weisberg of Montgomery McCracken tells the Ask Real Estate column in the New York Times. “As alterations become more complicated, you tend to see more of this.” 

Jeffrey Weber, president of Weber-Farhat Realty Management, begs to differ. “I don’t know of anyone who’s doing it,” he says. “Some boards charge $1,000 to $5,000 as a security deposit in case of damage. The way I feel, if someone is renovating his apartment and increasing the value of all apartments in the building – based on the most recent sales – why penalize that person for improving the building?” 

Most co-op shareholders and condo unit-owners are familiar with alteration agreements, which boards require any time an apartment is upgraded or two apartments are combined. The agreements typically require the renovator to pay for the board’s architect to review plans, and they lay out a schedule for completion of work and set fines if deadlines are not met. 

Fees like the one in the Upper West Side co-op are meant to cover the ancillary costs of renovations. Maybe the job is forcing the building to hire additional staff, or pay overtime to existing workers. Neighbors may have to tolerate dust, noise and the general headache of living next to construction. The service elevator may be tied up with crews carrying materials up and down. And of course if the meter is ticking to the tune of $1,000 a month, there’s an incentive to complete the renovation as quickly as possible.