Guest: 5 ‘secrets’ that board minutes might reveal

Some board minutes can be a challenge to decode. (Flickr photo by studentofrhythm)

If you’re buying a co-op or condo, don’t fail to have the minutes of the respective Board of Directors or Board of Managers examined by your attorney.

In his advice below, lawyer Ronald Gitter–whose Web site is an essential resource for his clients and anyone else contemplating a sale or purchase–writes that the minutes can provide critical information about the physical and financial condition of the building, plus insights into its personality, or “DNA.”

Below, he outlines the five areas that demand a buyer’s attention.  Only by reading the minutes as a key component of all the due diligence that your attorney performs can he or she be confident that you likely will avoid nasty surprises in the near and distant future.

It is up to you, says Gitter, to ensure that your attorney covers the following issues:

1. Reserves, maintenance and assessments. Although the old real estate mantra was “location, location, location,” now it’s “value, value, value” in the new economy. The minutes often describe a building’s cash position, the history of maintenance increases and the imposition of assessments. The Board’s ability to keep expenses in check and to avoid annual maintenance increases or assessments is always a sign good management.

2. Capital expenditures.