Let’s renovate!
“Ah,” the prospective buyer coos, “this co-op has great potential.”
Uh, potential?
“What do you have in mind?” I might respond.
“Well, I’d like to take out that wall between the living room and dining room. And it would be great to turn that closet into a powder room. And. . . “
I point out that residents need to present an alteration agreement to the building’s board for approval of such an enterprise.
“Do you think there’ll be any problem?” the buyer invariably asks.
It is a good question and not one with an easy answer, surely not one with an absolute answer.
First, it is good to know or find out whether residents of the building have had similar work undertaken with no objections from the board.
Amenable property managers of buildings may be able — and willing — to provide that information, though it will be laced with caveats; for example, no one in the same apartment line has sought permission for precisely the same sort of work or the composition of the board has undergone major changes since then or board members have heard complaints about sagging floors where walls have been demolished below certain units.
A listing broker with considerable experience in a particular building also may prove to be both honest and knowledgeable. You’ll know by the level of detail that agent is able to offer.
It would be nice to ask the board for prior approval, but I am not aware personally of that ever having been the case. However, a board occasionally will give some idea of its thinking after a contract is signed and before the property changes hands. In either instance, the likelihood of at least prior guidance increases as the size of the building decreases.
For buyers of co-ops, the uncertainty of board approval of significant renovations is bound to complicate their decision-making and can torpedo a sale.
One high-profile sale recently dissolved in part because the purchaser’s idea of combining two apartments on the Fifth Avenue building’s top floor implied excessive traffic in public spaces and also because the new owner would have a disproportionate amount of influence when votes were taken.
With the contract for more than $30 million of that high-profile transaction thereby voided, the homes of the late heiress Huguette Clark went back on the market and a new buyer’s purchase of one of the apartments was approved last month.
It is true that boards tend to give a nod to most work that is like other work carried out previously. But it is, unfortunately, also true that there is no assurance of past continuing as precedent.
In other words, nothing is — I can’t help myself — etched in stone.
Tomorrow: Fuzzy thinking
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Malcolm Carter
Licensed Associate Real Estate Broker
Senior Vice President
Charles Rutenberg Realty
127 E. 56th Street
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