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Council of New York Cooperatives & Condominiums
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Comparative Study of Operating Costs
 

Published: Autumn 2013

COMPARATIVE STUDY OF OPERATING COSTS
32 CONSECUTIVE YEARS OF COST ANALYSES

CNYC's Comparative Study of 2011 Operating Costs has been sent to all current members and Professional Subscribers, and the 2012 Study is being prepared.

This useful Study is compiled annually from data in the financial statements of participating cooperatives and condominiums. Cost breakdowns from more than 900 cooperatives and condominiums provides a framework to help you decide if your own building is operating economically and efficiently. Members are welcome to copy and circulate any portion of this booklet. Additional copies can be purchased from CNYC for $25 each.

SEVEN SETS OF STATISTICS
The Comparative Study is presented in seven sections – East Side cooperatives, West Side cooperatives, Manhattan condominiums, condominiums outside of Manhattan, lofts, small Manhattan cooperatives (100 rooms or less), and small cooperatives outside of Manhattan (in recent years, all data for this section has come from Brooklyn cooperatives), and larger cooperatives outside of Manhattan.

DOLLARS-PER-ROOM-PER-YEAR
With the exception of the loft section, all statistics are presented on a per-room basis. This was selected as an appropriate common denominator as it is more practical both to understand and to manipulate than square foot figures (which are used for the loft section) or breakdowns by apartment, where the tremendous variation in size would make the data less meaningful.

CATEGORIES PRESENTED
The Comparative Study shows the composite assessment upon which the current property taxes are based, the mortgage balance, and maintenance fees for participating buildings. It then lists amounts spent per room on labor, fuel, utilities, repairs and maintenance, insurance, management costs, administrative costs, water & sewer fees, property tax, and debt service. When possible, elevator maintenance and legal and accounting costs are each listed separately.

TEN YEAR RECAP
This raw data is followed by a chart of summary statistics for each of the sectors in the study. It shows the range, average and median cost for each item, and the average portion of total operating budget devoted to that item. This ten-year capitulation is instructive in determining trends.

A HISTORIC PERSPECTIVE
CNYC conducted its first Comparative Study in 1975, examining a rather homogenous universe of 22 recently converted, full service cooperatives on the upper west side of Manhattan. Wages accounted for 30% of those budgets, debt service claimed 23%, property taxes 21%, fuel 7.5%, management 2.5% and insurance 1.5%. More than three decades later, with over 900 buildings contributing to the study, there are statistically significant showings in all categories but lofts. Larger West Side buildings now devote about 23% of their budgets to wages, 37.5% to property taxes, and 12.5% to debt service. On the East Side, this trio reads 25%, 40%, 10.5%, and for larger cooperatives outside of Manhattan, its wages 20.5%, taxes 25% and debt service 17%. Fuel consumes about 10% of a budget today – while management and insurance have increased their share modestly.

A USEFUL TOOL
The Comparative Study is a research tool, a starting point for analyzing the efficiency and cost effectiveness of how you run your cooperative or condominium. It will be most interesting and useful if it includes your data. By comparing your performance, category-by-category with other buildings of similar size, you can note where your spending might be out of line.

DIG DEEPER
This should trigger further analysis to ascertain whether your numbers reflect an extraordinary situation. Do you have very low repair and maintenance figures because you've brought the building into wonderful shape and now have fine service contracts on all systems?....or because you've postponed needed work for yet another year? Are your insurance costs at the top of the range because no one reviews the policy or seeks better rates or because you have several major projects underway and have increased your liability coverage for the duration of the work? The answers you find to this type of question will help determine the action you then take. The goal is always to have a well run, cost-effective building that meets the standards set by the shareholders and unit owners through the board they elect.

CAPITAL PROJECTS NOT INCLUDED
It should be noted that the Comparative Study does not address capital projects, which is a prime area where prudent management and careful bidding processes and vetting of vendors can yield significant savings.

CNYC welcomes cooperative and condominium financial statements for the Comparative Study of 2012 Operating Costs. Code numbers are used to identify participants, while preserving their anonymity. Please include a room count if you have not been a past participant in the Study. Send this information to CNYC by fax to 212 580-7801, e-mail to Rothman@CNYC.coop or 'snail mail' to CNYC in Suite 730 at 250 West 57 Street, New York, NY 10107.

 
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CNYC
250 West 57th Street, Suite 730
New York, NY 10107-0730
Tel: (212) 496-7400
Fax: (212) 580-7801
E-mail: info@cnyc.coop
 
   
 
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