With more than a century of combined experience, the partners in Armstrong Teasdale’s Cooperative and Condominium Law practice have not only handled just about every type of issue you might expect to see, but they have also been instrumental in the development of co-op and condo law in the New York City market. Led by Howard Schechter and Phyllis Weisberg, the practice boasts three former chairs of the New York City Bar Association’s Committee on Co-ops and Condos, as well as the current co-chair of the New York State Bar’s Cooperative and Condominium Committee.
At the beginning of 2019, the group joined Armstrong Teasdale, (an AmLaw 200 firm founded in 1901), and together, with an office in Philadelphia, became part of the firm’s East Coast expansion. With more than 250 Armstrong Teasdale attorneys practicing in a broad range of services and industries, the New York office lawyers have a deep bench to draw on when needed.
When Schechter started practicing co-op and condo law in the 1970s, individual ownership of apartments in New York was a very limited phenomenon.
“There was a high-end echelon of buildings where you could buy a co-op apartment,” Schechter said. “But other than that, New York City was a city of renters.”
That has changed considerably, with more than 400,000 co-op or condo units in the market, according to the New York City Rent Guidelines Board’s 2018 Housing Supply Report.
“When I started practicing, there were three condos in Manhattan,” said Weisberg. “Now, there are hundreds. There weren’t even that many co-ops when I started. There were some that were beginning to undergo conversion, and then there was an explosion in the ’80s. It’s become a prevalent form of ownership in New York City.”
The number of buildings owned as co-ops or condos has continued to expand year after year, Schechter said. Partner Andrew Brucker, who has practiced co-op and condo law for four decades, has also noted an increased number of condos compared with co-ops.
“Until recently, the overwhelming number of privately owned apartments in New York were co-ops, and yet that form of ownership is not that common in other areas of the country,” Brucker said. “Only recently, in the last 10 to 15 years, have condos become popular.”
They have risen to the point where they now comprise approximately 26% of the total co-op/condo market, according to the Housing Supply Report. Part of the appeal of working in this area of law is that it’s rarely the same thing twice.
“This area of law is so diverse, you could be dealing with a shareholder issue in regard to a leak on one day, how to evict a pet pig the next day, and a corporate law issue the day after that,” said Julie Schechter, who has practiced co-op and condo law for more than 10 years. “Our job is part legal work and part group therapy. You have to deal with small group dynamics, and you have to know how to respond to them.”
Tenants usually have a wide variety of issues and complains. “The most common problems we encounter have to do with quality-of-life issues: someone complains about noise from another apartment, maybe someone comes in with a dog that barks a little too much,” said Brucker. “Those become the most difficult issues because the board ends up in the middle of two tenant-shareholders at war, and there’s no way you can plan for that. As Paul Simon said, ‘One man’s ceiling is another man’s floor.’ It gets terrible when it starts to get out of control, and it often does get out of control.”
One thing all of the Armstrong Teasdale attorneys agree on is that condo and co-op boards often do not get the credit they are due.
“I’ve met really interesting and dedicated people,” Weisberg said. “The volunteers who serve on boards work very hard and try to do their best, and often are not rewarded for it. I like being able to help them. In the press, co-op boards get bashed a lot, and with minor exceptions that’s very unfair.”
The board plays a vital role as their decisions weigh heavily. “Those dedicated volunteers often benefit from legal counsel to see the issues lurking behind the decisions they make,” Howard Schechter said. “I always urge our boards that are considering major decisions, such as refinancing their mortgages or undertaking a large improvement, or talking to their neighbors about access to do improvements, to talk to us early in the process so that we can help them identify key issues, and avoid bringing us in at a point when renegotiating terms could be seen as going back on a deal.”
The attorneys are also keeping an eye on regulatory and legal developments that will likely impact their clients, including a series of recently passed laws that will require many of the buildings they represent to cut greenhouse gas emissions by 40% by 2024.
“We expect that this is going to have a huge impact on the buildings and many of the decisions that they make,” Howard Schechter continued. “Many of our buildings have made improvements over the last number of years that reduce their energy consumption because it was just good business sense to do so. But that trend is going to be greatly accelerated by this new suite of laws, and we are gearing up to advise and assist our clients in the compliance that will be required.”
They are also looking for opportunities. One of the services that Julie Schechter has provided is developing innovative approaches to derive income from common area spaces. This includes storage facilities that are licensed or sold to unit owners, as well as rental agreements for common spaces such as event rooms. Residents who are buying two units in order to combine them can sometimes be sold a portion of hallway space to incorporate into the construction.
“It’s a good way to create additional income for the co-ops,” she said.
The practice that opened the office at the beginning of the year also includes traditional “dirt” lawyers, led by Real Estate Partners Saul Mishaan and Jeff Dayon. The duo has been handling complex real estate transactions for over three decades –– serving clients not only in the five boroughs but across the country. Trusts and Estates Partner Isaac Saufer, Commercial Litigation Partner Charlie Palella and over a dozen experienced associates and paralegals round out the original group. Since becoming part of Armstrong Teasdale this year, the practice has moved into offices on Third Avenue that give it room for additional growth. And growth is a goal for the practice and the firm. Leading the firm’s efforts on the East Coast is Richard Scheff, a nationally recognized trial lawyer and corporate adviser who serves as the managing attorney of both the Philadelphia and New York offices. Already this year, the New York office has added construction and real estate litigator Steven Tolman, who specializes in construction law, and condo and co-op attorney Dale Degenshein. Another partner, intellectual property attorney Michael Gnibus, joined the New York office in June.
The firm’s deep bench of attorneys skilled in other aspects of real estate law and related services is what led Degenshein to Armstrong Teasdale.
“In addition to professionals in the field whom I’ve known for decades, I also work with lawyers who are well-schooled in construction, trust and estate work, and employment work,” she said. “It’s important to me to have that expertise.”
Armstrong Teasdale is continuously growing. “Everybody has been very supportive and wants to help us grow the practice,” Weisberg said. “Armstrong Teasdale has a lot of resources that can benefit our clients, and the way the firm has sought to support us and help us grow is very significant.”
Of their clients, Brucker said, “You become like part of their family. You are helping people who appreciate you and who you get to know. A true mutual respect develops, and you become an effective working team with your clients. We have been representing some of these buildings for 35 years, and some of the residents have been living there for those 35 years. We have even been invited to weddings. It’s nice to see how we all grow together and form a real bond.”
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