Almost everyone is under pressure these days to save money however they can—and co-op and condo buildings are no exception. Even those associations who are financially solvent and have money socked away for a rainy-day capital improvement project or two are still trying to root out unnecessary expenditures and find other cost-cutting measures. But where do you trim the fat?
Aside from cutting the big ticket items that may turn residents mutinous—such as closing the children's play area, or cutting back doormen's hours—there are overlooked or under-exploited ways that administrators can save cash.
Take a Good, Hard Look
But first, it’s important to find out where the money is going before you can cork it and stop the spending flow. To do this, take a close look at all expenses, especially all contracts that have been signed.
“Look at your contracts for overspending even before they are up for renewal,” says Greg Carlson of Carlson Realty in Queens, and the executive director of the Federation of New York Housing Cooperatives & Condominiums (FNYHC.) “You’re spending too much money if you can look around and get the same services for less money.”
When you start cost-cutting, Carlson says to have a plan for immediate versus long-term savings. Immediate savings are exactly what they sound like: changes you can make now and see an immediate result. Long-term savings take effect over time, and may be a tougher sell to residents who might be more receptive to a plan offering instant gratification.