Beyond Due Diligence: 3 More Reasons to Resolve Violations

By Renee Sosnowski

For many building owners and property managers, violations only become a concern when considering either a sale or a purchase. Prospective buyers perform due diligence to avoid unpleasant surprises, and sellers often choose to clear violations on their own, rather than place large sums of money in escrow for resolution.

That said, keeping a clean building profile pays off in other situations as well, including the following:

1. Certificates of Occupancy. Before tenants can move into that brand-new—or newly renovated—space, owners and property managers need to secure Certificates of Occupancy (COs) from the New York City Department of Buildings (DOB). Since that final CO requires resolving all open violations, the project signoff phase is a popular time to seek violations guidance. (Hint: Bringing in early help can avoid construction and occupancy delays.)
2. ICAP Tax Abatement. A number of building owners are clearing violations to qualify for New York City’s Industrial and Commercial Abatement Program (ICAP), which reduces increased real estate taxes due to new construction or improvements for eligible buildings. ICAP can save companies tens of thousands of dollars.
3. High-Profile Projects. Not surprisingly, the changing skyline of New York has attracted close municipal scrutiny to ensure worker safety on these massive construction sites. Larger projects typically receive more inspections, which often lead to more violations. Staying on top of violations can help keep a complex project on track.

Choosing a Violations Partner

The DOB posts many violations on the Buildings Information System (BIS), but certain violations and liens require extra legwork. If the main goal is to identify—rather than resolve—violations, several companies offer affordable, automated violations research.

When trying to clear violations in a timely, cost-effective manner, choose a partner with a proven track record in violation resolution. Specifically, look for the following:

• Relationships. A reliable partner should work closely with the municipal agencies. Ask how frequently they send personnel to the ECB court, DOB, etc.
• Timing. An experienced firm can tell you how long it takes to clear different types of violations. The timing varies, depending on the agency.
• Knowledge. An expert can provide insight into options for waiving or reducing penalties, for instance, or whether a new owner in fact inherits responsibility for a decades-old violation.

For questions related to violations, contact Metropolis at 212.233.6333.