The Co-op and Condo Insider
The Co-op & Condo Insider is your trusted source for expert commentary led by advocates within New York City’s co-op and condo world. Each episode offers insights into the challenges, news, and stories that shape a community making up more than 20% of this great city’s residents.
The Co-op and Condo Insider
The Glen Oaks Miracle: Bob Friedrich's Path to Transforming Glen Oaks Village
Ever wondered how a struggling 3,000-unit co-op transforms into a thriving community? Bob Friedrich, President of Glen Oaks Village, takes us behind the scenes of what host Geoffrey Mazel calls "the Glen Oaks miracle."
When Bob purchased his apartment in 1986, he discovered a co-op in crisis – deteriorating buildings, financial mismanagement, and defaulted loans. As a young accountant attending his first annual meeting, he recognized the severity of the situation when the treasurer couldn't answer basic questions about a $15 million loan. That moment launched his journey from concerned shareholder to board member to president, a position he's held since 1997.
The turning point came when Bob negotiated with federal agencies to forgive nearly a million dollars in arrears in exchange for ownership of hundreds of apartments. While some board members wanted to sell these units immediately for quick cash, Bob saw their long-term potential. Today, those apartments are worth approximately $90 million – financial foresight that stabilized Glen Oaks and created lasting prosperity.
Beyond Glen Oaks, Bob founded the President's Co-op and Condo Council, uniting over 100 co-op boards representing 100,000 voters to fight harmful legislation. He details the existential threats facing affordable housing today, from Local Law 97's unfunded mandates that could cost tens of millions to skyrocketing property taxes that have increased 58% since 2019.
What makes this story remarkable isn't just financial turnaround but community transformation. Bob's leadership created a professionally managed co-op with transparent governance, among the lowest maintenance fees in New York, and a vibrant community where families thrive. As he puts it, "Co-ops are affordable housing – where else can you purchase a one-bedroom unit that you own for $250,000?"
Whether you're a co-op resident or simply interested in how communities overcome challenges, this conversation offers invaluable insights on leadership, financial strategy, and preserving affordable homeownership in New York City.
I'm watching the mayoral debate the other night and they're asking everybody what their rent is and I realized out of nine of them, not one of them lives in a co-op. And I was talking to somebody today and they think out of what's it? 51 New York City council members, maybe five or six live in co-ops. So we have spent a lot of time educating legislators about co-ops.
Speaker 2:This is the Co-op and Condo Insider, the podcast dedicated to New York's cooperative and condominium communities. This is your trusted source for the latest insights, strategies and stories shaping the world of shared housing. You will hear from the people who are leaders in this community information and insights you will not hear anywhere else. If you want to stay ahead of the curve, you're in the right place. The views and opinions expressed on this program do not necessarily reflect those of the host or any affiliated individuals or organizations.
Speaker 1:Hello and welcome to the Co-op and Condo Insider, where we explore the real world issues facing co-op and condominium communities across New York City with insight, expertise and a healthy dose of straight talk. I'm your host, jeffrey Maisel, co-op attorney and legal advisor to the President's Co-op and Condo Council. I'm thrilled to be joined by my co-host, richard Solomon. A seasoned voice in public radio for over 20 years, richard has taken his listeners around the world to meet experts, newsmakers and the people making a real difference in our everyday lives. Richard, it's great to have you on the mic with us today.
Speaker 3:Love being here and we have an incredible guest.
Speaker 1:Well, as I said, Richard takes us around the world, but today we're not going very far. We're staying in Queens.
Speaker 3:Right, we're going to queens. Right, we're gonna go right down union turnpike going down union turnpike.
Speaker 1:um, we are thrilled to be uh uh hosting uh bob friedrich, president of glen oaks village, a longtime civic leader, a a uh great story at glen oaks, great stories with respect to co-op history in the city of New York, and I consider a dear friend. So, bob, welcome.
Speaker 4:Well, thank you for having me. I look forward to this. I wish you the best of luck on the podcast. I think it's a great idea, and let's start.
Speaker 1:Tell us a little bit about your background and where you grew up.
Speaker 4:I'm an accountant by trade. That's what I do and I grew up in Clearview Garnins, which is a co-op in Northeast Queens. My formative years were there. I lived there until I was about 13 years old. Then we moved to a private house, but all my formative years was in a co-op a private house, but all my formative years was in a co-op. And that's where I first learned or even understood about co-ops. A lot of people don't even understand what a co-op is, but that's where I started. I then moved with my family. My parents moved to a private home around the block and then I actually bought a house out on Long Island in East Meadow and I lived there for about three or four years and then I realized it was not for me mowing the lawn, worrying about water leaks, taking care of everything. I said this is crazy. And I said you know what? I'm going to move into a co-op and I moved into Glen Oaks Village.
Speaker 1:What year was that Bob?
Speaker 4:I moved into Glen Oaks Village on October 24th 1986. Okay, so it's a long time ago.
Speaker 1:So just if I can interject here that at that point in time I was suffering from excessive youthfulness and I was a member of the Glen Oaks board at that time and I do remember you, at one of the annual meetings the treasurer was completely terrified of you.
Speaker 4:Well, I actually remember that very well. One of the reasons that I actually got involved on the board because the co-op at that time had taken out a loan a $15 million loan to pay for new boilers and some other things. And when I asked the treasurer about the loan when do we have to start making the payments? What's the principal interest? He had no idea. And then I realized, uh-oh, I'm screwed, living in Glen Oaks Village with a treasurer on the board who really had no clue or concept. And that's when, as an accountant, I realized that's not a good thing. And then, when I drove around, because I really knew nothing about Glen Oaks Village, I saw a lot of the garage roofs were missing shingles, I noticed a lot of the for all space small windows were covered with chicken wire and I realized what the hell is going on here. And so, between seeing what I saw and then hearing what I heard, I realized that I had to get involved. And that's really the genesis of how I got involved in Glen Oaks Village.
Speaker 1:So what makes today's podcast so different or interesting is I'm one of the few witnesses, or the continuum from the early 80s to the early 90s and I am an eyewitness to what happened at Glen Oaks. And for you listeners out there, glen Oaks Village is a 3,000-unit co-op. It's in Glen Oaks and Bell Rose, eastern Queens, on the Nassau border by what's that? Long Island Jewish Hospital. It was the largest converted co-op in the early 80s east of the Mississippi. I don't know what the biggest one was. I think it's the fourth or fifth largest co-op in New York City and the largest co-op in Queens. It's massive.
Speaker 1:It was a very complex situation where you had people that bought their co-op. You had rent stabilized tenants. You had a sponsor who was a tremendously difficult person to deal with. He made his money when he converted and lost complete interest and was actually losing money on the complex. So, bob, at the time you came in, I was on the board and we were in an existential crisis because the sponsor had actually defaulted on his maintenance and on his loans. So that meeting that you and I met and this is where the continuum was that was my last meeting as a board member and that was sort of your entree. So why don't you tell us what motivated you to run for the board? How did you run for the board and then go into some background on? I call it the Glen Oaks miracle Bob. I really do. I think what you did there was extraordinary. I don't think people really understand it. What you did there was extraordinary.
Speaker 4:I don't think people really understand it but if you could just explain to us simple terms what happened and incredibly innovative. Glen Oaks Village is the largest garden apartment co-op in New York. We're a horizontal co-op as opposed to a high-rise vertical co-op. We have 2,904 units. We have about 10,000 residents here. We're in two non-contiguous areas about 125 acres and we have a combination of shareholders fair market tenants because renting in Glen Oaks is permitted. We have rent stabilized. We have about 62% of our apartments are owner-occupied, 31% are fair market sublets. Those are sublets by owners, and then about 6% of the remaining apartments are still rent-stabilized, although that number has been coming down as those apartments are unoccupied.
Speaker 1:So when I was on the board and you could correct me, I think the rent-stabilized were about was it 50% or 60% of the units at that time?
Speaker 4:Yeah, yeah, absolutely. Because when a co-op converts, what happens to those who choose not to purchase, the individuals who are in the apartments then become rent stabilized, then become rent stabilized. But I will say that it's a great community. It's a diverse community. We don't have a lot of problems between shareholders and the board. We are transparent in all of our actions. So there's really a very, very good relationship. When I first got involved, I got on the board. I was elected to the board in May of 1991, and I became president of May of 97. So I have an incredible amount of institutional memory and I was also involved in all the things that happened there in Glen Oaks.
Speaker 4:Gerald Gutterman was the sponsor of the unit of the co-op. He actually owned the property when it became a co-op. He then went bankrupt, wasn't paying and if you remember, in that period of time, because he defaulted, the banks that were holding the mortgages then became owners of the units. Now, in that period of time those banks there was a lot of bank failures. So the banks that held the units that Gerald government owned were required to pay maintenance. But then we had all these bank failures so the banks that owned the units then failed. They actually became bankrupt. So the government created the Resolution Trust Corporation to take over the properties of the failed banks to protect those residential communities, in our case a number of those. One of the banks that failed, those units were taken over by the FDIC and the other bank that failed, those units were taken over by the Resolution Trust Corporation we call the RTC.
Speaker 4:So now in Glen Oaks Village we had a lot of apartments maybe 500 or 600 of the apartments that were now owned by the RTC and FDIC because those banks had failed. Well then the RTC and FDIC were not paying their maintenance. So now Glen Oaks was not getting the money. We were really in horrible financial shape was not getting the money. We were really in horrible financial shape.
Speaker 4:So at that time I organized I believe it was actually at that time Moynihan put together a meeting with FDIC and RTC in which I and the president at the time were involved, to negotiate a takeover of those apartments. I mean, when I think about it I mean I was a young kid. Then I mean here I am negotiating with RTC and FDIC and it's just unbelievable that I think about that period of time. But we were able to negotiate those apartments. The RTC and FDIC were about a million dollars in arrears. We told them we will allow you to walk away from those arrears, but we want full ownership of those apartments Because I understood as an accountant that those apartments would have significant value in the future. That will help the co-op financially succeed. A few months of negotiation we were able to negotiate with both those entities and Glen Oaks Village Owners Inc. Took over those apartments. The RTC and FDIC were allowed to move on without paying their arrears and now we own those apartments.
Speaker 1:What are those apartments worth today that you got for a million dollars?
Speaker 4:Apartments that we still own, and we still own quite a bit of them. We own about 200 and some odd apartments. Those apartments have a value today of about $90 million.
Speaker 4:So if you looked at all of the apartments that we had, it would probably be $180 to $200 million. So if you looked at all of the apartments that we had, it would probably be $180 to $200 million over the course of time. I understood that if we could change that community, set it up in a proper way, we could change the financials of Glen Oaks Village, where it then became a prosperous and well-run home.
Speaker 1:The rent-stabilized rents did not cover the maintenance. There was that shortfall and now you took on that shortfall and that really was your risk waiving the back maintenance. You could absorb that. So how did you cover that shortfall? When I was on the board, every meeting shortfall was every other word. How did you plan on cover that shortfall? Because when I was on the board, every meeting shortfall was every other word? How did you plan on covering that shortfall? Because you got to pay your bills?
Speaker 4:Oh, I know, Absolutely. It's a very good question. We actually had two maintenance increases in one year of around a total of around 20%. That's a lot of maintenance to increase. People were upset but it had to be done. So that raised a lot of revenue on a regular basis.
Speaker 4:In addition to that, when we took over the apartments, there were some apartments that were empty. So we were able to then sell those apartments. But, jeff, it's very interesting because at that period the other issue that I had was at that period of time we had a lot of companies coming out of left field and wanted to buy the apartments at fire sale prices. Hey, we'll give you $3 million, we'll give you $4 million for all the apartments. And it was very tempting as a board oh my God, get $4 million, you know, fixes all our problems. But I said absolutely not those apartments. It's like an IRA, it has value in the future. We cannot sell them. So I had to deal with a board that really wanted to do that. So I was able to convince the board not to sell them which we didn't to these entities. But I put into a place, a program where the apartments that were vacant we fixed up and then we sold them. Then we sold them as renovated units so we were able to command a higher price, although in those days the price was still low.
Speaker 4:So between the maintenance increase and being able to sell the units, we were able to stabilize the finances of the co-op and start moving forward. And as we did that, we now perfected our renovation program. We brought in an outside real estate agent. We interviewed a number of them, brought in one who we wanted to market our apartments that we own and to this day we still have that relationship. That's Rob Miller. He's an onsite real estate agent, although we allow any real estate agent to come in and buy and sell apartments for shareholders because we believe competition is a good thing. So you want people, but we needed somebody who had marketing expertise to help us. So we brought that in and as the years went on, we were able to sell the units, make some money also start identifying expenses and waste and abuse and we were able to really cut the budget. So we created the self-management where we set Glen Oaks Village up like a company.
Speaker 4:We have a very professional staff. I put them up against any other co-op. Our general manager is probably the best in the city. We have a great board of directors. There's no infighting, there's no backstabbing. We have a population here that supports the board. You have your 1% and 2% of people that are chronic complainers, that will always complain, but for the most part people are happy. We have among the lowest maintenance, probably the lowest maintenance of any co-op around. Plus, we have no flip tax and you know what a flip tax is. A flip tax could be a tax from 5% to 50%. When somebody sells, they're losing a big chunk of that money. We understand that. People who own co-ops. That's their largest investment If they want to retire. We shouldn't be grabbing a chunk of their money. So we have no flip tax, the lowest maintenance and we are in financially excellent condition.
Speaker 1:Tell us about the President's Council, how you founded it.
Speaker 4:So let me tell you what happened to President Copeland Condo Council. In those days I realized that there was a lot of legislation that was being fomented by the city council and the state legislature and there was a lot of other issues. We had issues in Glen Oaks that I'd like to speak to other board presidents and I realized very quickly there was no way for me to contact any board presidents. There's no directory, there's no phone number and when I would call up a co-op I couldn't get the name of the president there. So there was absolutely no way for board presidents and co-ops to connect, to talk and to bounce ideas or issues off each other. So I said you know what? We need, an organization named the President's Co-op and Condo Council. And for a year I remember this methodically I called up every co-op. I spoke to their managing agent. I said I'm the president of the Galonics Village. Please have your co-op president call me or contact me, because they would never give me the information. And over that period of time of a year I was able to get all this contact information. So I had that together legislation being put out there. That was really very anti-co-op. And, jeff, there was even a meeting that you and I went to with Warren Schreiber, who's the president of Bay Terrace Co-op, where this group it was sponsored by our local assemblyman or councilman and this group came in and it was unbelievable. Everything they were saying was anathema to what was best practices for co-ops. And then so we took all the information that I had with the president and we put this structure together. We created the President's Development Condo Council and now we had an organization that at least had numbers, because we have over 100 co-ops that are now part of this, with voters probably around 200, maybe more 100,000 voters, because we have a lot of co-ops and in those co-ops there are voters. So we put together this organization and we started reaching out to council members, to assembly members, to state senators and, over time, through myself, your help, jeff, obviously, and Warren, we were able to create an organization that was about co-ops.
Speaker 4:We don't sell products. We're not in the business of advertising. We're simply in the business of educating members of the legislature when it comes to issues that deal with co-ops. And all of us that are on a P-triple-C to President of the Co-op of Congress, we have different views. Some of us are Democrats, some are Republicans, some are Trump supporters, some are not Trump supporters, it doesn't matter. The focus of the organization is co-ops, because when it comes to co-op issues, these are not Democrat, republican. These are issues that affect people's lives, where they live, and their families. So we put this organization together and it's been hugely successful. We've been responsible for stopping a lot of bad legislation, we've been responsible for modifying some legislation to make it more palatable and we've been responsible for writing legislation that got passed.
Speaker 3:How many legislature people that you've interfaced with, both Jeff and Bob, are actually residents of co-ops 0.01%.
Speaker 1:That's not scientific, but I was actually.
Speaker 3:Is that the problem?
Speaker 1:It's a tale of two cities. I'm watching the mayoral debate the other night and they're asking everybody what their rent is and they're all talking about their rent. And I realized, out of nine of them, not one of them lives in a co-op. I don't know where they're, you know. I know Adams doesn't live in a co-op and I don't know about Siwa. So basically they don't live in co-ops. And I was talking to somebody today and they think, out of what's it, 51 new york city council members, maybe five or six live in co-ops. So so we we are, you know, bob and I and we have spent a lot of time educating legislators about co-ops, co-op issues. Linda lee comes to mind, mark Weprin comes to mind, vicky Palladino comes to mind, and that's a big part of what we do, especially in legislators that have large districts, large co-ops, large number of co-ops in their district.
Speaker 4:And I would also say, Jeff, that a big issue in the city is always we always hear affordable housing. Affordable housing, Other than the multi-million dollar Fifth Avenue co-ops or Park Avenue co-ops in Manhattan, most of your co-ops in New York, in Queens, in Brooklyn, in the Bronx, it's all affordable housing when else can you purchase, let's say, a one-bedroom unit that you own for $250,000? You can't do that anywhere, but you can do that in New York in a co-op. That is the essence. That is the essence of affordable housing. But we're constantly at battle with the city council and the state legislature that are doing everything possible to destroy the goose that lays the golden egg.
Speaker 1:What are the most pressing issues facing Glen Oaks today?
Speaker 4:There are a lot of issues a lot and we usually refer to them broadly as unfunded mandates. These are pieces of legislation written by the state legislature or the city council that create enormous expense for co-ops that are completely unfunded. Obviously, the big one is Local Law 97, which the New York City Council passed back in 2019. It's called the Climate Mobilization Act and it requires buildings that are larger than 25,000 square feet to reduce their carbon emissions by 40% in the year 2030 and 100% by 2050. And it affects all buildings larger than 25,000 square feet. Glen Oaks Village has 1,630,000 square feet. However, it exempts one to three family homes, it exempts NYCHA housing and it exempts all the government buildings are all exempt. So really, the only residential housing that's part of Local Law 97 are co-ops.
Speaker 1:What type of numbers are you looking at in Glen Oaks?
Speaker 4:Okay, so in Glen Oaks Village what we're looking at are crushing penalties. That would be for noncompliance, because the only way to comply with local law 97, the only way to comply and have no penalties is we would have to remove all of our working gas-fired boilers that are very efficient, that are very cost-effective. Replace them, in other words, take the working boilers out, remove them physically remove working boilers and create electric heating in 134 buildings, everybody's apartments, everybody would have an electric heat pump. An electric heat pump woefully inefficient below 40 degrees, so they have auxiliary electric heating components. So when the temperatures in the winter go below 40, you're now heating with electric in a city that has the highest electric rates in the nation that continue to increase at double digits, and the ones who are paying those are the rate payers In Glen.
Speaker 4:Oaks Village if we don't remove all of our working boilers and put in these electric heaters, we're facing penalties up to $2 million by the year 2040. That is per year $2 million per year.
Speaker 1:Where does that money go?
Speaker 4:That money goes to the general fund in the city of New York.
Speaker 4:So it doesn't help the environment Doesn't help the environment at all. And if we even were considering putting electric heat and we're not going to do that because most of our shareholders, people who live here, are seniors or working class families they would be bankrupt. They would be bankrupt by heating their homes in electric. We wouldn't do it. But if we were forced to do it, we would have to rewire all of our buildings because our buildings cannot handle electric heating in every apartment. That rewiring would cost between $50 and $75 million. And if they were to discover asbestos within the walls? And if they were to discover asbestos within the walls, that means we would now have to remove the residents from those buildings, house them separately and have that asbestos removed, which could cost $100 million. That money doesn't come, you know. It has to come from somewheres. It would have to come from the shareholders who live in the co-op, which would mean assessment of an excess of $25,000, $30,000, $45,000 per family. I'm telling you right now, when we raise maintenance $25 a month we get complaint letters that they can't afford it.
Speaker 4:In addition to Local Law 97, property taxes in New York is a major, major problem. New York City property taxes continue to be our largest single cost component in our budget. We've budgeted property taxes this year to be $10 million, which is 40% of all maintenance everyone pays. And just to give you an example of what's going on pre-pandemic in 2019, the property taxes in Glen Oaks Village were $6,317,000. So between 2019 and today, property taxes have increased 58 percent. This is crazy. This is destroying affordable housing and we have to deal with this. And I can tell you, a lot of board presidents do not sleep at night worrying about these issues.
Speaker 3:Has anybody thought of making an Eighth Amendment challenge to all of this, which is an excessive fine? Well, we didn't actually.
Speaker 4:Rich, it's interesting you say that because the President's Co-op and Condo Council through Glen Oaks Village and Warren Shriver's Co-op actually challenged local law 97 in court. It was a two-year process. It finally went up to the New York State Court of Appeals, the highest court, and we actually lost the case.
Speaker 1:And our first signature issue with the President's Council was the taxes trying to get a tax cap and tax cap protection for co-ops and condos, because one or two family homes already enjoyed that. At this point, Richard, I think it's time to lighten things up a little, so why don't you run the lightning round it, Bob?
Speaker 3:All right, so, between PDS 209 194 and Bayside, any great memories of going to any of those fabulous institutions?
Speaker 4:Well, I grew up in Northeast Queens and Clearview. Ps 209 was just a wonderful place, was a wonderful school, wonderful memories and, by the way, there are a couple of websites about PS 209. I go on there. I see people that I remember from the past. It just was a great way to be raised in a wonderful environment and I just wish more people today could be raised in that way. Hey. Jeff you asked before about pickleball.
Speaker 1:Oh yeah, okay, All right, I got a question. I hear you're a big fan of pickleball. How'd you get into it and who's your toughest opponent? Okay, the only reason I got into pickleball How'd you get into it and who's your?
Speaker 4:toughest opponent. Okay, the only reason I got into pickleball? Because it really is the only sport today where male and female, young and old, can actually compete competitively in a sport. You can have somebody 18 years old and somebody 70 years old play pickleball and actually have a competitive game. You can have a woman and a man play together, play together or play against each other and have a competitive game. There really are no sports like that and it's an incredibly social game. If you come to our pickleball courts on any evening after 730, there are scores of people there playing, talking, hanging out, so it's just a lot of fun. It's great exercise, great social, and I'd rather be on a pickleball court than sitting home watching tv and eating chips have you done any motorcycle trips lately?
Speaker 4:well, you know I am an avid, a motorcycle rider. I also have a couple of cars, but uh, I haven't. Uh, in the past I've driven on a motorcycle to California about a half dozen times into Florida. I've taken long trips, wonderful times out there. They're very dangerous, you've got to be very careful. But there's nothing like being on a motorcycle driving in the southwest into the canyons, the warm desert air. It's just a wonderful experience and I would recommend it for anybody.
Speaker 4:And even if you're not riding on a motorcycle, take a car, go into the canyons, just drive with a friend, with your spouse, and you'll just have a wonderful time.
Speaker 3:All right From nostalgia purposes Milkmaid, clearview, bakery, wetsons. Any comments?
Speaker 4:Well, rich obviously, was a resident of this area in Northeast Queens called Clearview, and Milkmaid was a wonderful place. I remember having ice cream there and Sundays you'd go in there and they would have all of the toppings and then you'd get ice cream and put it on there. The Clearview Bakery was the most wonderful bakery. Unfortunately today there are very few bakeries, but you would go in there. There would be long lines. I remember that There'd be long lines and you'd smell the fresh bread. Just a wonderful time.
Speaker 4:It really was a wonderful time to grow up in a community where you were always outside. You weren't inside on computers, you were always outside. You weren't inside on computers, you were always outside. And maybe only around six or seven o'clock would you hear your mother's voice calling you to come back in. Nobody was worried about are you going to be abducted. You were out there with your friends running around. It just was the time and, by the way, a lot of that still happens in co-ops. You come to a place like Blanauts where you do have young families who are just starting out, who live in courts. They have a lot of children playing outside, so you can still experience that in a co-op environment. It really is very special.
Speaker 1:Bob, it's been an absolute pleasure having you. Your experience and dedication to the co-op world are truly inspiring, and thank you to our listeners for tuning in to Co-op and Condo Insiders. We'll be back soon with more stories and insight from the people shaping our city's housing and future. Thank you and good night.
Speaker 4:Jeff, thank you so much. It was a pleasure and I hope to be on again down the road.
Speaker 1:You open invitation Bob.
Speaker 2:Absolutely.