By Sabina Mollot
CompassRock, which was still a startup when it took over the day-to-day operations of Stuyvesant Town/Peter Cooper Village, has recently set its eyes on an even bigger catch.
Last November, the Denver-based management arm of CWCapital became one of eight companies that put out a bid to manage Co-op City in The Bronx, and now it’s considered one of three favorites.
Jeffrey Buss, an attorney for the co-op, which is known as a company as Riverbay Corporation, said the goal is to pick a new management company by the end of this month, although there have already been delays.
First the 15-member co-op board has to make a decision, but even then Wells Fargo, which has a $621.5 million mortgage with the property, still has a say, and HUD (a major guarantor) and the state housing agency are also key players.
Meanwhile, Cleve Taylor, the president of the board, isn’t sold on CompassRock, explaining that he finds the company’s lack of experience – it formed in 2012 — concerning.
“That is one of my chief concerns,” he said. “It appears in our management criteria that with respect to managing Co-op City, they are supposed to have five years of experience. It appears to me on the surface that CompassRock does not meet that criteria. So that is a major concern of mine. My second concern is that CompassRock does not have sufficient experience managing Mitchell-Lama cooperatives in the State of New York. CompassRock’s relationship is mostly landlord-tenant based.”
He added that he thinks Riverbay might even be better off without a third party manager.
“It is my opinion that if a qualified managing agent is not found that Riverbay Corporation should remain a self-managed entity,” said Taylor, “since our managers have more experience than CompassRock, LLC. It’s just a plain fact.” However, he added, bank documents contain language that says there must be a managing agent or general manager.
Co-op City has been searching for a new managing agent since last October, and its last management company, Marion Scott Inc., has been out of the picture since November. Riverbay and MSI are currently in litigation, with the latter having sued in an attempt to get reinstated. The property, meanwhile has accused its former managers of mismanaging money and labor relations with the property and it is now in the midst of hammering out a $6.4 million settlement to be paid to employees by September. As a result, Co-op City’s residents will likely soon be facing a 4.5 percent hike in their monthly carrying charges in order to pay for it.