It’s been said that it takes a village to raise a child. It can take nearly that much to run a multifamily building as well, even a small one. Residential communities require the services of a wide array of employees and professionals, ranging from those who physically keep the building running (supers, handymen), to security people (doormen, and in some cases guards), to off-site professionals (attorneys, accountants), to occasional service providers—everything from roofers to interior designers to landscapers. The central point for organizing these various and varied providers is the community’s board, with support from its managing agent.
Looking for the Right Stuff
The hires a board may be called on to make generally fall into three basic categories: building personnel, professional services, and contracted services for specific building work. Clearly, these three categories have different requirements and require different approaches.
When it comes to hiring a professional—an attorney, for example—“you need to parse through the legal issues at hand,” says Dan Wollman, CEO of Gumley Haft, a management firm based in Manhattan, “and the board has to consider what type of representation they need. It’s important to find someone who has represented other associations or corporations with similar needs.” One-size-fits-all is not necessarily the optimal arrangement for the many possible legal issues a co-op or condo may face. “For building staff,” Wollman adds, “hiring has been difficult since COVID, and is still terrible. We hire lots of people through referrals—many times those referrals are from people who already work in the building. We object to nepotism within a building, though, so someone hired through a family recommendation would work in a different building in our portfolio.”
When looking for a contractor for a specific job or project, like a roofer or a landscaper, “you’re looking for someone who has a good reputation,” says Scott Wolf, CEO of BRIGS, a Boston-based property management firm. “The choice of a contractor is not always based on price. The decision can be about their ability to provide services, or simply their availability. Availability has become a top issue since the pandemic.”
Wolf adds that a common problem he encounters when taking on a new client association is the tendency for boards to hire someone they know personally for a high-stakes role like attorney or insurance rep for the association, without that person having the industry-specific experience and credentials needed to do the job properly.
“Boards often choose someone they know who doesn’t specialize in condos,” says Wolf. “It’s the same with attorneys. The professionals a board works with must specialize in condo association law and insurance. Not a life insurance salesman, or an estate attorney. They must specialize in this type of work.”
The Buck Stops Here
When hiring employees, whether they be building personnel, outside professionals, or contractors, who should be making the final decision on which candidate gets the job?
Michael C. Kim, an attorney who represents co-ops and condominiums and is the principal at Michael C. Kim & Associates, a law firm located in Chicago, suggests the following as a rule of thumb for boards and board members:
“The board of directors should be actively engaged in the selection of contractors for major capital projects. While it is highly recommended to utilize a consulting engineer/architect to pre-qualify contractors and actually conduct the bid process, if the board does not use an architect/engineer but instead relies upon their management agent, they should discuss and agree with the management agent on the criteria for selecting bidders and the specifications on which the bidders would be submitting their proposals. This ensures uniformity of project descriptions on which bids are to be submitted.
“They also must consider the relevant factors and ranking of such factors to evaluate the bidders/bids, and the screening process to ultimately select the successful bidder,” Kim continues. “For example, starting from five bidders, reduce to two bidders to be interviewed, from which one bidder will be selected. A passive board of directors runs the risk that they will effectively ‘surrender’ the decision-making function to the management agent, which could result in uninformed decision making by the board, or irregularities in the bidding/selection process of which the board would not even be aware. The board could designate one or two of its members to take the lead in such interfacing with management if the entire board is not able or interested in such involvement.”
Andy Marks is senior VP of Maxwell-Kates, an Associa Company with property management offices around the country, and the former president of his co-op. He concurs with Borenstein, adding that “the decision to hire a particular vendor is ultimately the board’s. Our job as managing agent is to ensure that vendor partners we are sourcing are proven capable of doing the highest quality work at the most reasonable cost, and that we’re getting multiple bids to keep everyone honest. We will do the upfront work to level the bids, then present them to the board for them to make the most informed decision.”
Wolf says, “Ultimately, it’s the board’s decision on who to go with, but it’s always the manager’s responsibility to provide the information for the board to decide. Boards rely heavily on management for recommendations. I will tell them who I think is best qualified, but always give them options and outline the differences between them, regardless of whether we are seeking professional, building, or contractor services. I will review what each candidate’s strong suit is—litigation vs. collections in the case of an attorney, for instance. We want them to make the right decision.”
When it comes to hiring, Wollman sees a dichotomy between service employees and professional and vendor services. “I don’t think the board needs to have a lot of input on staff members like porters or doorpersons, but they should have some input on hiring a super. That’s because the super runs the show, they live in the building, and the board has to be comfortable with that person.”
Wollman adds that “with professionals, depending on what they’re doing, I like them to know them as well. If I’m doing a single contract, it’s not a big deal—but if it’s a major project, the client should know who they are getting into bed with, so to speak. It’s important. It’s their money. There’s also a lot of value when the board buys into the hire.”
Referrals vs. Database
Having as much information as possible about a potential hire is critical to making a good decision. Simply Googling ‘NYC plumbers’ and picking one from the first page of results is probably not the way to go, say the pros. This is one of the reasons having a professional manager can make a board’s job much easier. Most management firms maintain databases of information on all kinds of professionals at all levels, and a good manager will also ask for referrals from professional acquaintances, current employees, and colleagues.
“We have a vast and deep roster of vendors that we work with across the entire spectrum of professions, trades, and skill sets,” says Marks. “These include attorneys, CPA firms, insurance brokers, licensed engineers, architects, plumbers, electricians, roofing and façade contractors, HVAC technicians, elevator companies, and many more. When recommending retaining these services on behalf of our co-op and condo clients, regardless of the service provided, we always seek to provide multiple vendor choices (at least two or three, depending upon need) so our client boards can make the most informed decision about which will be the best fit.”
Wollman uses referrals as well. “Yes,” he says, “all the time. I have half a dozen close friends in the industry who I speak with regularly. If I’m looking for a tradesperson, for instance, I will call them and ask them for a recommendation. We share information. It’s like the management mafia,” he jokes.
The goal is not just to find a service provider who is competent and competitively priced, but to find someone with whom the board and manager ‘click.’ “Just like with selecting the right management company,” Marks says, “one of the intangible factors that goes into a successful partnership is whether there is the right ‘chemistry’ with the board and community. That goes for all types of vendor partners, but especially with professional services like legal counsel and accounting firms. In an era where there is such an emphasis on property technology disrupting our industry, ultimately it’s the people you do business with and the relationships and trust you build between you that matters most.”
When hiring a person or company to provide a service to your building or HOA, it’s definitely worth asking what potential red flags boards and managers should be on the lookout for. The answer depends a great deal on what type of position you’re filling. Red flags for on-site building employees are very different than for contractors, for instance.
“When a prospective super says he’s available and not working, that’s code for, ‘I got fired,’” says Wollman. “If you look hard enough, and can get enough data, you can figure out if it was their fault or not. I speak to contractors, managing agents, union guys, and put it together and figure it out. To be honest, on the other side, I have never been called on by a managing agent on a super I’ve fired, which is inconceivable to me. You must know everything about a super before you put him or her in a building.”
As for contractors, Wolf says, “Watch out if the contractor asks for a large deposit up front. That often means trouble. Mostly, for me, it’s a gut feeling. Past experience that guides me. When a contractor can’t provide a certification of insurance in a timely manner, or if they don’t respond well to the RFP, I know there’s a potential problem.
“And perhaps most importantly,” Wolf adds, “you have to be observant and insightful. If the candidate doesn’t respond well through general conversation, you can assume there is the potential for problems.”
“Word of mouth is hugely important in our business,” says Marks. “If their work is subpar or they don’t treat their customers with respect, it usually gets back to us.”
Whether it be for a handyman, a lawyer, or even a roofer, hiring a service provider on behalf of an entire building community can be a complicated process. Both management and board must be involved and focused to find the best possible person for the job, whether it be big or small, long-term or short-term. The good of your community depends on it.
A J Sidransky is a staff writer/reporter with CooperatorNews, and a published novelist. He may be reached at email@example.com.