An Attorney Discusses Gearing Up For Capital Improvement Projects

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Capital improvements, by their nature, are the bigger repair projects needed on buildings, which are generally the most expensive and time-consuming to complete. Local Law 11 repairs on façades are an example that has tragically been in the news a lot lately. They can be done on all types of buildings, including co-ops, condominium buildings and regular commercial buildings.

Organizing and coordinating these repair projects requires a lot of time, energy, funding and advance planning. Let’s say a building has leaks on the roof and cracks in various locations. The building will need to first retain engineers to survey the work that must be done. Plans and specifications will then need to be drawn up, and bids will need to be obtained from contractors for pricing. There will need to be contracts drafted and signed. The plans will need to be filed with the New York City Department of Buildings and approved. Even if this work is done in advance, it is commonplace to find “hidden conditions” that are not yet in the plans, requiring additional work and money. It may also require additional design time. Therefore, whatever money is allocated for the project, additional monies must be set aside for these contingencies.

Some buildings need to refinance their mortgages to obtain funds. In those instances, the advance planning can occur over the course of a couple of years. This is why sometimes we see buildings in obvious need of repair with protective scaffolding and wonder why no repair work has been started yet. The answer may be that the owner is still trying to arrange for the financing, even though that is not really an excuse.

Since the repair work is hazardous and will take time to complete, a sidewalk shed and other protection must be in place to protect the public and workers from any falling debris. Sidewalk sheds usually extend 20 feet or so onto neighboring property. Despite the need for such safety measures and protection, sidewalk sheds are often met with hostility by neighboring businesses, which claim that they block the view of stores and buildings and scare people and customers away. In extreme cases, sheds have been left in place for long periods of time while the building owners try to obtain the necessary funding for the repair work or work out other issues. In one case, the sidewalk shed was protecting people from hazards due to falling debris, but was preventing the installation of handicap access ramps to help resolve another issue. Sometimes neighbors threaten to take such issues to court. However, given the balancing of the issues and the need for such repairs, it is doubtful a court would require scaffolding to be removed without the work being fully completed.

There must be a fully thought out, well-drafted and negotiated contract with the contractor prepared under the guidance of an experienced construction attorney. Having the right insurance in place and naming the correct parties as additional insureds is very important.

The nature and location of the work may be such that materials will need to be moved up to the roof and stored, possibly on a neighboring roof, for easy access. Permission for that type of access needs to be requested, negotiated by knowledgeable legal counsel and obtained in advance in a written, signed license agreement. A fee may need to be paid to the building allowing the access. There may also be liquidated damages in the agreement for each day the building is late in completing the work to give more incentive to keep the project on track.

People need to know who is responsible for performing various tasks and when.

A knowledgeable construction attorney, an experienced property manager, a construction manager and an engineer are all part of a good team.

C. Jaye Berger, Esq.
Law Offices C. Jaye Berger
110 E. 59th St., 22nd floor
New York, NY 10022