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Hello,
There are some people in the building talking about being unhappy with our current Management Company. It seems that when they were chosen by the BOD, the new company disclosed to the BOD that they had "a relationship" with our building's sponsor. Apparently they had to do this due to conflict of interest or some fuzzy reason I'm not sure about. I know the name of the sponsor, and his LLC company under which he owns about 9 apartments, and obviously I know who our management company is, how can I find out what that relationship is, and why it's a concern? Can anyone offer ideas? A couple of us seem to think something fishy (long story) is going on since they came on board, but as I don't serve on the current BOD I can't say for sure. Thoughts?
We have a similar situation in our co-op, confirmed, the sponsor is also the managing agent. We have begun the process of looking for a new managing agent - It is not an easy execution, but the hunt is on.
Why --- Upon my joining the board, I was ready for change, and had experience in finance to see some of the blatant conflicts of interest.
As we progressed to hiring an engineer for a physical survey, moved onto new fuel suppliers, it was becoming clear the sponsor who objected every step of the way, was now using the managing agent to slow things down. An example - the check can’t be signed because nobody is in today or my favorite, we can’t tell you who is in arrears today because you need to wait until the third Friday of the month for the financial reporting pack.
The managing agent was slowing us down. We have not confirmed our new managing agent, but we are actively exploring. Getting new contractors, etc has largely fallen to us as resident purchasing shareholder board members to procure and meet with contractors for each project.
I would document things that seem strange, ask questions in writing, know and understand your prop lease, by laws, and house rules and begin to form the necessary coalition to begin the push for reasonable change.
A side note - It won’t be simple or easy, but keep everyone in the loop, form a coalition, set clear objectives and keep the focus on the true intent for your co-op's existence - to provide a permanent residence for purchasing shareholders - our prop lease even --- states as a first class residence.
Keep it civil, document document and document, patience and preservation will go a long way to improving the situation.
In my experience, the goals of the Sponsor and the goals of the Board can differ and at times, greatly. You want the management company to listen exclusively to decisions made by the Board. The proper forum for the Sponsor to raise issues is at the Board Meeting. Get an independent management company as soon as possible.
i agree with Steve you should change agents. Make sure your agent has the ability to do what the board wants and not be pressured by the sponsors requests. We had a similar problem until we switched agents, now everything is fine, and they are very on top of the game.
DavidG, if you can e-mail me regarding this issue.
Thanks. (mblevine@ebmg.com)
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there is definitely something "fishy" going on. i would recommend to switch management since the sponsor never has any interest in doing anything to benefit the current shareholders. the sponsor must have a big say in the decisions since they have some sort of previous relationship.
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