Habit #7: “Sharpen the Saw”
In “The 7 Habits of Highly Effective People”, Stephen R. Covey talks about the “upward spiral” model that results from growth, change and constant improvement. The Upward Spiral model consists of three parts:
The management team in a coop or condo is composed of three distinct entities: the board, the property manager, and the staff. When their strengths are combined, goals can be achieved that could not have been done by just one of these entities.
You Have Two Ears and One Mouth- Use Them in That Proportion
Understanding the limitations of the staff, managing agent and fellow board-members is important. Although the staff reports to the managing agent, the managing agent reports to their firm first and ultimately to the board. The board then reports to the residents. The managing agent has, in most cases, multiple buildings with multiple emergencies such as leaks, fires, floods; and of course loose cats.
As the decision-maker, the board is in charge and needs to set the overall tone. Only when there are clear goals, systems and plans, will all of the involved parties in the organization thrive.
It is not uncommon that boards and residents tell us that their staff is lazy or is in “cahoots” with the managing agent. It is also not uncommon to hear that boards are unhappy with their managing agent. We could give you a very long list of all the reasons they think so, but in reality, the culprit is more often than not the board.
Identify what is required by law; what is urgent, what is needed; what would reduce ongoing costs; what residents want. Then, prioritize what all this entails. Most residents want to live in a safe home with an inviting and friendly atmosphere and probably with as many amenities as possible while paying as little as possible. This is not an easy task to realize, especially since the board members most likely all have jobs, families, other activities and commitments.
Have a Long-term Plan
Ask yourself, what is your ultimate desired outcome? Is it a more cost-efficient building, a greener building, more amenities to better compete with the new luxury condos or something else? Or, are you perfectly happy with the current state of your building and the yearly rate increase that you pass on to your residents and neighbors?
In our Co-op & Condo Board adaptation of Stephen R. Covey’s “The 7 Habits of Highly Effective People,” the first 3 habits discuss changing your mindset from being too dependent upon others to being completely independent and self-reliant. Here’s Habit #1 addressing the importance of being proactive or plan ahead.
Have you ever heard of a motivational self-help book for Co-op and Condo Boards? Neither have we. This adaptation of Stephen R. Covey’s 1989 Free Press book “The 7 Habits of Highly Effective People” is a self-help book for Co-op and Condo Boards detailing how to run a more efficient building.
Running a Condo Association is no simple task. You must manage a budget, keep a building in good repair, fix issues for Owners, deal with unexpected disasters, manage crazy Board members, and more. Although this can be daunting, there are certain Condo Association management basics which will help guide you towards success.
Summer is here and in the midst of such heat, next year’s winter heating season can seem distant. However, the best time to manage next year’s heating costs, if you haven’t started already, is TODAY! Most buildings have old and inefficient boilers and heating systems, which creates both unnecessary costs and carbon output, as well as discomfort. Here are some tips on what to prioritize and where to start:
If you’re a board member of a coop or condo building, you and your board undoubtedly work hard to represent your fellow owners. While owners want you to maintain your shared home at the lowest cost possible, the primary board and management responsibilities are the management of day-to-day operations, as well as special requests and emergencies. This leaves very little extra time to devote to serious cost cutting.
When your co-op or condo elects new board members, they will bring innovative and diverse ideas to the table. Residents always have high expectations that new board members will solve lingering issues, find new approaches to meet resident needs, and better manage fixed and variable costs. Utilizing social media, "greening" the building, and utilizing expert residential co-op and condo consultants are just a few of the ways board members are tackling the complexity of multi-residential housing challenges.
Many people appreciate the obvious work we do in helping boards cut budgets, save money, and run more efficiently. There are many “big” items involved with this, but small details also matter and add up. Effective communication is an example of this. Between the many moving parts and layers of management; board, super, managing agent, much can go wrong. This is a case of “too many cooks in the kitchen.” Proper technology can solve this, while at the same time creating cost efficiencies.
Most of you have heard about the effect of compounding. This is commonly known and spoken about in investments. According to Merriam-Webster it is “to pay (interest) on both the accrued interest and the principal.” The opposite is true as well. Although not often talked about, the effect of compounded savings, or reduction in expenses can be significant. We helped one association cut one particular expense, which over the next 10 years will save them, using some reasonable assumptions, over $240,000.
Working closely with your managing agent is a great start to cutting costs. The managing agent normally has a great bulk program for both electricity and energy purchases, providing an opportunity for their buildings to switch to ESCOs and reduce unit costs. Although cutting the cost of something the building uses and considers a fixed cost is a great start, it is not even half the battle. Here are 10 tips on cutting heating and electric use.
It’s that time of the year again. Soon, you will need to inform your owners that their monthly fees are increasing, again. This is in spite of a close to zero inflation economy and owners’ salaries barely (or not) increasing. Despite this, every contract and vendor that the board hires, on owners’ behalf, automatically increases their fees every year.
The Folson Group was consulted about reducing waster costs in an unconventional way for Unfixing "Fixed" Costs by Marianne Schaeffer and Habitat Magazine. We discussed a technique that is incredibly affordable and results in substantial savings for any Coop or Condo where water is included in the resident's monthly fees. Link to article here. Please like, share and comment!
When we work with HOA, Cooperative and Condominium boards on cutting costs, they often want both significant and immediate results. Your association’s expenses should be reviewed on an ongoing basis in order for it to operate efficiently and generate wealth for the owners. Here are some of the small expenses that add up over time that too often are not reviewed and/or renegotiated and some tips on how to change all that.
In theory, keeping your residents happy should be fairly easy as their interests align with yours, since you too are a resident. However, serving on the board can become very political since you as a board member have been voted in to that position, not unlike a politician voted in to theirs. So what can you, as a board member, do to keep your residents happy?
This is Election Season for most NYC co-ops and condos. You have been recently elected to the board of your co-op or condo, your largest investment: now what do you do? You may be the best Attorney, CPA, Consultant, or Financial Advisor on the planet, but how much do you know about running a building?
We help Co-op and Condo boards reach a quorum for their Annual Meeting, every year. For many buildings, every year is a struggle to get a quorum in order to have a legal election. With our assistance, Annual Meetings are well-attended and proxies from non-attendees are handed in ahead of time. Read our top 4 tips on reaching a quorum:
Audited financial reports are being prepared as we speak and will be issued to owners & shareholders in the next few weeks. In New York State, The Business Corporation Law requires them to be issued before March 31 each year. Does your building abide by that law? If it doesn’t, it surely needs a Finance Committee.
New York Residential Property Values are reaching all-time highs, as demand continues to push up prices.
What can current owners do to further increase the value of their buildings, and help them stand out from their neighbors?
It’s a New Year with New Beginnings and all-new New Year’s Resolutions. Here are some fun facts:
The #1 New Year’s Resolution is to lose weight
The #5 New Year’s Resolution is to stay fit and healthy
It’s the holiday season, which is also high season for packages. Online shopping continues to become more and more common, and with the attendant shipping there will only be more and more deliveries. Packages are now being delivered seven days a week, at all times of day!
As we “fall back” and adjust our clocks, many of us have heard that we should also change the batteries in our smoke detectors. In addition to doing that, here are some things that ensure a safer and more efficient (cheaper to run!) home:
Space is limited and real estate prices are soaring. Are your Co-op and Condo basement spaces utilized in the most efficient way? Here are 5 Tips on how to increase income for the building while adding amenities, all which in effect increase property values.
Interview with Green is Good Radio's founder John Shegerian: Operating Buildings More Efficiently with The FolSon Group's Tina Larsson
Tina talks about how apartment buildings, including Co-ops and Condos, need to cut waste in order to keep monthly's in shack. Eliminating waste, thereby running buildings more efficiently, are often results of #greening the building.
New York, NY, June 26, 2015 (Newswire) -The FolSon Group, a leading financial consulting firm to residential building management teams, is excited to announce a strategic partnership with Spire Group, Inc. Spire is an industry-leading full-service NYC real estate brokerage and consulting firm.
Cut your co-op monthlies: 5 ways to 'tackle' building costs
by Leigh Kamping-Carder of BrickUnderground.com
Conventional wisdom says that almost all of a co-op building’s expenses—about 90 percent by one estimate—are fixed, leaving shareholders little say on how their monthly maintenance fees are spent, and little room to save.
But that’s not necessarily true, says Tina Larsson, co-founder of the FolSon Group, a consulting firm that helps co-op and condo boards lower their expenses. A former Wall Street