Murray Street and its surrounding blocks have been getting a ton of press lately as Manhattanites continue to populate every inch of every neighborhood, especially those in the most sought-after neighborhood – TriBeCa. I just listed a high-end rental at 6 Murray Street, a boutique rental building consisting of five full floor lofts plus a duplex penthouse. The building is keeping up with the changing trends of the neighborhood and I have just worked with the landlord to complete the first of many renovations in the building. The 4^th floor loft has been entirely turned over and is now a shiny, new residence ready for its first tenant. Next up – the lobby, elevator and entrance to the building. If you are in the area, stop by and take a peek at the progress! 

MURRAY STREET NEIGHBORHOOD HIGHLIGHTS (just to get you started!)

EAT + DRINK
> Bouley (home to the famous Bouley Test Kitchen)
> Benares (Indian)
> Ecco! (Mamma’s Italian)
> Gran Morsi (local, reliable Italian)
> Gunbae (Korean BBQ and karaoke)
> Little Park @ The Smyth Hotel (veggie-friendly)
> Marc Forgione (eponymous restaurant from the famous Iron Chef)
> Rosa Mexicana (Mexican)
> Sole di Capri (hidden Italian gem)
> Tutto il Giorno (just like the one in Sag Harbor, Italian)
> Tribeca Treats (THE best spot for birthday cakes)
> Zucker’s (bagels and more)

JUST DRINK
> Juice Press
> Kaffee 1668
> Starbucks
> Smyth Night Bar (trendy)
> Ward III (great, local bar)
> Walkers (another local watering hole)

SHOP: Kids
> babesta (for the hipsta’ kids)
> Livly (recently opened)
> Balloon Saloon (local party store)
> Color Me Mine (painting)

SHOP: Adults
> Brookfield Place (all of the high-fashion 5th Avenue stores + dining, movie theater, food shopping, etc.)

SHOP: Pets
> The Spot Experience

SHOP: Food
> Amish Market
> Whole Foods

MOVE
> Equinox
> Hudson River Park
> Kula Yoga Project
> Real Pilates
> Soul Cycle

GETTING AROUND
> World Trade Center PATH station (designed by Santiago Calatrava)
> Subways (1, 2, 3, 4, 5, 6, A, C, E, R, J and Z stops all within blocks)

LOOK
> Brooklyn Bridge
> City Hall (enjoy the beautiful surrounding park)
> New York by Gehry @ 8 Spruce Street (brand new PS 397 Spruce Street school is housed there and offers Pre-K!)
> One World Trade
> ONE Art Space @ 23 Warren (bringing amazing art exhibitions to the neighborhood)
> 9/11 Memorial
> The Woolworth Building

COMING SOON
> Target!
> Serafina (local outpost of the reliable Italian restaurant)

I have gathered data from a few different sources on holiday tipping from 2013 as the 2014 information has not been published yet. Links are enclosed below, but the general consensus is that cash is king and early disbursement of tips is very much appreciated – as early as right before Thanksgiving. The staff need resources and time to shop for their own holiday gifts! Other factors that come into play are building size, family size and length of residency in the building.

http://ny.curbed.com/archives/2013/12/09/how_much_to_give_your_building_staff_the_annual_guide.php

http://www.brickunderground.com/blog/2013/11/doormen_speak_whats_a_fair_tip_how_the_tipping_system_should_change_who_gets_the_best

http://www.brickunderground.com/blog/2013/11/brickundergrounds_2013_holiday_tipping_guide

Jordan Roth, President of Jujamcyn Theaters

As President of Jujamcyn Theaters, Jordan Roth overseas five Broadway theaters, whose current productions include the Tony Award-winning Best Musicals The Book of Mormon, A Gentleman’s Guide to Love and Murder, Jersey Boys and Kinky Boots, as well as the upcoming Side Show. Additionally, Jordan is the Founder and CEO of Culturalist, where you can shape, share, and debate your opinions about anything and everything through Top 10 lists.

You grew up on the Upper East Side, now live in the West Village and work in the Theater District. You have almost all of Manhattan covered! For you, what is the defining feature of each neighborhood?
I think that all of those neighborhoods have a really distinct energy. You can almost be there, close your eyes and know where you are just by feeling it. On the Upper East Side, there is something about the width of the avenues and the way you have block after block of these beautiful buildings; each one unique and stately. In the West Village, block after block of fascinating structures. Unique windows. Doorways that go into back gardens. As well as the industrial architecture that I really respond to. I love the notion of living in a space that is industrial in scale. And, in Times Square, there is such a unique heartbeat. Such a pulse. It is literally coursing through the streets. I feel very connected to all of the neighborhoods for different reasons.

Any drawbacks?
Sure. There are drawbacks in each of them. I have never found them to outweigh the benefits. And, maybe it is part of being a New Yorker, but I don’t see them. I don’t feel them. I know they are there. Maybe you will bitch about them for a second, but they don’t get inside of you.

One of the things that I love about the city is – Walk three blocks and you are somewhere else. If it’s 9pm and the Upper East Side feels a little calm, go 20 blocks that way and – Welcome!

What is you strategy for navigating the crowded streets of Times Square on a daily basis?
I remind myself daily that a very large percentage of the people who are crowding the streets are coming to the theater. And so, I say – Bless you and come on in! Also, here is a little tip. You can cross mid-block from 44th Street to 47th Street. You can start at 44th Street and go through Shubert Alley to 45th Street. Then, go through the Marriott driveway to 46th Street. Then, cut through the Edison Hotel lobby to 47th Street. So, that is a little insider tip to bypass the main thoroughfares of Broadway and 7th if you are going uptown or downtown.

If you didn’t live in the West Village, what neighborhood would you live in?
This is a tough one because I have been in the West Village since I came back from college and I have moved twice since then. Each time, I thought – I have a five block radius. I am not going anywhere.

Like every other New Yorker, I look at all of the real estate ads every weekend. I will see some fabulous space on the Upper East Side or Central Park West and fantasize about living there, but ultimately I feel like the West Village is home for us now.

I loved Kinky Boots. What an uplifting story! If you could picture Lola in New York City, where would she live?
I think Lola is a Hell’s Kitchen girl. I don’t know if that’s just because the theater is on 45th Street and so I picture her on those blocks. I think that she is in a great walk-up that she has dolled up into a den of fabulousness!

Paula Iacovissi, CPA, Audit Partner at Citrin Cooperman

Paula Iacovissi, CPA is an audit partner at the accounting, tax and consulting firm Citrin Cooperman. Paula’s clients range from rapidly growing entities to long-established organizations in the construction, real estate development, investment, syndication and management industries. Throughout her 30-year career, Paula has assisted clients in securing financing, mergers and acquisitions, business succession, tax planning, restructurings and tax-free exchanges. 

Before we get into the interview, you suggested getting started with the definition of a “qualified home.”
A qualified home is very interesting because it really lends itself to a lot of flexibility. It can be a traditional house with a backyard or a condo or co-op. Mobile homes qualify, believe it or not, even though they are not in one fixed place as do boats. So, if someone wants to be adventuresome and sell their condo or co-op in Manhattan and live off of a boat; as long as it has sleeping, cooking and toilet facilities, it qualifies as a home and your interest could be deductible. It is pretty interesting that the IRS provides such flexibility in its definition of a home.

Can you discuss buying versus renting in light of tax deductions?
Renting has virtually zero tax deductions. On the upside, you really do not have any cost of maintenance, repairs or ownership responsibilities.

Buying. If you have the down payment available, it is a good way to go for long-term investment from a tax planning point of view. The domicile can be anywhere in the world, by the way. You can get an interest deduction for a primary home in another country. As many people know, you have the interest deduction of up to $1 million of capital, so in other words, you can’t by a home for $10 million, borrow $9 million and get a deduction for all of the $9 million worth of interest. It is only up to $1 million and that is very important to keep in mind.

Real estate taxes do not have any limitations and are totally deductible.

That is another very important thing to consider when looking at your finances – how much you are going to borrow, but also how much of it you are going to get back. On a long-term basis, buying is definitely a better way to go because as you pay down the mortgage, you are building assets and it is a form of “forced savings” that you can tap into later on to help you with other expenses or lifestyle matters that you may want to address. Specifically, there are two features of equity build. The first is that as you pay down your mortgage, you are saving money because you get some of it back in taxes. You are also paying down a portion of the principal, so your equity in that home is going up. The second feature of equity build is the benefit of property appreciation, which historically has not been an issue, but one can never predict the economy in various markets.

Another thing to consider about buying is that depending on your tax situation, people should speak to their advisor about the Alternative Minimum Tax (AMT). The AMT is a second calculation of your tax liability where it takes your regular tax as calculated with all of your itemized deductions and then re-calculates the tax in another fashion with certain adjustments to it. Those adjustments come up with limitations and if the AMT tax is higher than your regular tax, then you are considered to be “in the AMT,” which has cost you to lose the benefit of your real estate tax deduction. If you have been in the AMT and are in the AMT, you typically know it. It is something that is easily identifiable on your return.

Can you discuss the limitations on tax deductions for mortgages on both primary and secondary homes?
Up to $1 million, you are able to deduct taxes regardless of which home it is on. In addition, up to $100,000 of principal on an equity loan is deductible. If you want to borrow against the equity of your house for say, college education or short-term funding, up to $100,000 of the equity principal is deductible. The debt limitation is not per home, but per taxpayer. You can have the $1 million spread over two homes no matter how it is allocated.

The thing to consider about a secondary residence is that if that residence is 100% personal use, then the above applies. If the secondary residence becomes a vacation home that you rent out for part of the time, then there are different rules that apply as to which part of the mortgage is deductible and which part is not.

When you sell a primary residence, what are your capital gain exclusions?
Basic rule is that you have to have lived in the house for two of the last five years to exclude the capital gain. It also has to be your primary residence. Vacation homes or secondary homes do not qualify for this exclusion. So, if you have two homes that are pretty close to each other and you are planning on selling one, you might want to think about which one should be your primary residence.

The other thing to consider about the sale is that you do have a $500,000 exclusion of gain for married couples filing jointly and $250,000 for individuals. That means that if you sold a house for $2 million and it cost you $1 million, the first $500,000 of gain is tax free. The other $500,000 will be taxed at long-term capital gain rates assuming that you owned it more than one year.

Let’s take a hypothetical. You buy a primary home for $1 million and sell it for $2 million three years later. What are your tax consequences?
If you lived in it for two out of five years, then you can sell it and defer the gain. Say you decide to hold onto the house because you have been transferred to another city or another state and you are not sure that you are going to like it there. You can still sell your home as long as it is within the two out of five consecutive years.

Upon the sale, you are going to have your tax liability. So, assuming you have no mortgage on the house, if you sell the house for $2 million and it cost you $1 million, you will end up with $2 million in your pocket. The taxes on that $1 million of profit are as follows. If a New York City resident, the city and state taxes are about $40,000 each. This does not include the additional city and state transfer tax that is part of the closing costs. Then, your federal tax, which includes Obamacare and the capital gain rate, is 25% of $500,000, which is $125,000. So, you have a total tax of about $200,000 on the whole transaction.

The other thing to consider is that you have to make estimated payments for under-payment of taxes related to this gain. If you normally have no estimated payments made during the year because you have a W-2 and all of your taxes are withheld and all of a sudden you are going to have an additional income item, you should consider making estimated payments during the year to cover your tax liability. Be careful with that as well and put the money aside.

How do you advise clients in determining an appropriate budget for buying a home?
Typically, we do not advise on this topic because that is a very personal decision, but as far as mortgage payments are concerned, I would use 30% of income towards the mortgage plus maintenance payments as the guideline. I mean, can people go higher than that? They probably could, but it depends on what their lifestyle is and what their other costs are in relationship to their lifestyle.

Final thoughts?
The biggest disappointment with ownership is that if you are in the AMT, you really do lose a lot of the deductibility on the loan and on real estate taxes. Before people do buy, if they are counting on a tax savings to be able to afford the home, it is very important that they look at their tax status to see if that would put them in the AMT and if it does, then they are really losing the benefit of ownership.

We touched on Dodd Frank in our last conversation together, but can you elaborate on the impact, specifically the definition and impact of the Qualified Mortgage Rule?
The Qualified Mortgage Rule (QMR) really creates a safe harbor for the banks. If they issue a qualified mortgage to a qualified buyer, then they cannot be sued by the buyer. This is phenomenal because banks have been sued by buyers and the Attorney Generals for umpteen billions of dollars. So, the rules are very strict and because the CFPB has been regulating banks over the last two years, banks have been scared to issue mortgages that are not qualified. There are two rules with the QMR. The first rule is that qualified mortgages must amortize over a set period of time and cannot have a prepayment penalty. So, qualified mortgages have a 30 year or 20 year or 15 year fixed rate or an ARM, for instance.

Then, you have mortgages such as interest only loans, loans that have more than a 30 year amortization, loans where the rate can adjust over short periods of time, loans with a negative amortization. These loans are not qualified mortgages.

The second rule with the QMR is that the applicant cannot spend more than 43% of their qualifying income on their debt. This is a big deal. This is going to and has already eliminated mortgages for a large portion of Americans. There is a large percentage of Americans that are self-employed, that unfortunately do not declare a lot of their income. They write off a lot of their expenses. Their net income is very low and they do not qualify for a traditional mortgage because they just don’t show the income. However, these people usually have a ton of assets, fantastic credit and have been self-made. They’re very proud. They run their own businesses or consulting firms. These are not defaulters. Before the craziness of 2004 to 2007, banks that did no-income loans usually required more money down, required the person to have a very high credit score, required the applicant to have been in the same field for five years or more and to have a tremendous amount of post-closing liquidity. What I read was that those no-income loans actually performed better than the traditional loans. People who met those guidelines were not defaulters, but Dodd Frank did not want to open Pandora’s Box and allow the no-income borrower to come in. They did not want, in my opinion room, to leave room for interpretation.

Now, that doesn’t mean that banks can’t issue non-QM loans. But, let’s say there is a business owner with a tremendous amount of liquidity and a lot of money in the bank and the bank sees the deposits going in, but for one year, the business owner did not show the income for whatever reason. Under normal guidelines, if you didn’t show any income for the last year and you are self-employed, then you don’t have any income to qualify. Let’s say that the bank has been doing business with this person for ten years and last year was an aberration. The bank can say – You know what? This is a great client of ours. We are going to issue him a mortgage. You are going to see more of that, but now, you are also going to see a lot of people getting denied.

It really is simple. The banks can’t sell certain products. The applicant must meet the debt-to-income ratio of 43%. Plus, there is a rate test that forbids the bank from charging too high a rate.

How does the QMR affect the local, New York City buyer?
A lot of people in New York work for Wall Street, so their compensation comes from bonuses, so they like the interest-only loans (IO) because they can live off of their salary and pay down the loan as time goes on. So, banks are still issuing IO bonds, but there are just fewer of them. And, those who are offering the IO loans are usually doing so at a much higher rate because there is more risk. Nobody knows how it is going to play out. Certain banks say that they don’t care and other banks say they do care and they pulled out of the IO market. My feeling is that banks are going to just increase the rate for the IO market and deal with the risk and mandate that the borrower have more liquidity, more job stability – just tighten the underwriting guidelines on those non-qualified mortgages.

Do you think that the new mortgage rules will affect pricing?
I think that the mortgage rules will not only affect pricing, but also the cost of getting a mortgage. Because so many more rules have to be followed and processors have to check so many more things, these people have to get paid somehow, so costs are rising. It is going to have to get passed onto the consumer and we are seeing that happen already.

In your opinion, what is the tipping point with rates that will force prices to decline?
That is a very good question. Before July of last year, you had 30 year fixed rates at 3.5% and everybody wanted a “3” handle. Now you are in the “4’s” and “4’s” are still good. I still think that “5’s” are good because I have seen 9.5%. I think that once you get over 5.5% and you are closer to 6%, you will see things dry up very quickly. It becomes that much more expensive per thousand to borrow money on a monthly basis. So, $1,000 dollars at 6% happens to cost $6 per thousand per month. But at 4.5%, it’s $5 per month. That is a big difference. This is just a subjective thing, but the tipping point, in my opinion, is that in the upper “5’s” things start to slow down.

Who knows what is going to happen with rates? The FED is starting to pull back. The ten year bond went from 1.5% from 3.75% and now it’s been trading between 2.7% and 3%. If it goes to 3.7%, which it could very quickly, then mortgage rates will go up that one percent.

Another thing that you are seeing is that a lot of big banks are giving away their 30 year fixed rate mortgages for ridiculously low rates. They have to mark those to market at some point and if rates go up one percent, then they are going to lose a lot of money on them. Now, they are making the spread between the deposit and that rate, but as deposit rates go up, it is going to be horrible for them. It’s not like a savings bank that issues five year adjustable loans where they only have interest rate risk for five years. These banks are issuing 30 year deals, so they have risk for 30 years.

Eric Appelbaum is a Division Senior Vice President at Sterling National Bank. Prior to joining Sterling, Eric was the President of Apple Mortgage, a mortgage broker firm, which he founded in 1994. 

So, you were a mortgage broker until you recently joined Sterling. Why did you decide to make the move and what does that indicate about where you see the industry moving?
Great question. That question brings up a lot of issues going on in the marketplace. So, Dodd Frank is all about any party in a consumer transaction having deep pockets to deal with any liabilities. Dodd Frank has basically stated that they don’t want entities or originators without any skin in the game to be handling a large transaction for a consumer, i.e. a mortgage. So, for years, mortgage brokers, who are considered third party originators, would originate through just about every bank that existed. Before Dodd Frank, a good mortgage broker could deal with 40 institutions and have every product available to be competitive. Mortgage brokers originated about 70% of all mortgages. Remember, the mortgage broker would originate the loan, process the loan, send the loan to the bank and the bank would decide if it was worthy enough to pass their muster and would approve or deny it. It worked well. But after Dodd Frank, banks believed that they would be held liable for loans originated through mortgage brokers or third party originators. So, Citi, Wells, Chase, HSBC, Bank of America and a whole host of other lenders pulled out of the TPO market, the third party originator market. For the last two years, mortgage brokers, like myself, were dealing with other players that were able to provide those products, but that market has started to shrink even further. So, I knew that the mortgage broker market was dying a slow death.

The next option would be to become a mortgage banker. Now, as a mortgage banker, the banker originates the loan, closes the loan with a line of credit from a bank and then they sell the loan a few days thereafter to one of those parties. Most banks are dealing with mortgage bankers, which is called the correspondent channel, because bankers have to have some money in the game and have some money set aside. The problem is that the writing is on the wall with Dodd Frank. Regulators and banks want mortgage bankers to have a tremendous amount of liquidity just sitting in their company. But, if you are running a small regional mortgage banker, you’re not going to want to have $5 million dollars sitting in your entity just doing nothing.

So, I needed the platform that would enable me to put loans in a bank’s portfolio, especially a bank that knows this market, close loans and sell those loans, and broker loans. That is what the Sterling model is. They give us the opportunity to give the client the best that we have, and if the best thing is to broker the loan, then we broker it. If the best thing is to bank the loan, then we bank it. If the best thing is to portfolio the loan, then we portfolio it.

So where is the industry going? You are going to have fewer providers, and if you have fewer providers, it is harder to get credit. It is harder to get credit? It is harder to close loans. It is harder to close loans? Then prices go down. A Case-Shiller report that just came out showed that home prices overall have decreased slightly over the last two to three months. What has happened over the last two to three months? The implementation of QM, which we can get into later.

At what point in the buying process should a buyer contact a bank to determine how much he or she can borrow?
The second that they want to start looking for property, they should have their qualifications vetted. You don’t want to get down the road and say I want this, you make a bid, it gets accepted, you hire a lawyer, they send out contracts and then the buyer finds out that they cannot get approved. I still see that. It is not just going to any bank. A lot of these people sitting at the large commercial banks are really not vetting the file. So, we get this all the time. Someone calls up and says – My credit is 595 and I don’t have much in post-closing liquidity. Am I going to be able to get a loan? And, I say –No, what are you doing? You just signed a no mortgage contingency clause on a contract and you put down $120,000 on a $1.2 million purchase? The buyer usually says – Well, my banker at XYZ bank said it was ok.

So, I still see that a lot in the industry. They really need to work with someone who is well-educated, understands the underwriting process very well, will vet their file and will give them a good guideline of where they can go. So, it should start at the very beginning.

When consumers are shopping for the lowest rate, how do you suggest they go about getting the best rate? And, is it all about the rate or the pace of service and attention that the bank may provide as well?
The most important thing when a person applies for a mortgage is that they get the mortgage. You can quote any rate, but what is the chance of delivering that rate? I get this a lot. People say – Well, somebody quoted me this here and somebody quoted me that there. But that provider may not have a great reputation in delivering the rate. Shopping for the rate is still very difficult and the Fed and CFPB have not been able to figure this out, especially since rates are so compressed. It used to be that the rate difference from one provider to the next could be a one percent difference. And now maybe it is a quarter of a percent. You have to look at the best rate not when you apply, but when you lock. You usually lock only when know you can close within the lock period of 15, 30, 45, or 60 days.

But, how do you know you are getting the best rate ahead of a lock? You have already made an application with someone like me and three weeks later we lock the rate, but you say – Hey, this guy over here on the web is quoting one eighth lower. It is virtually impossible to know if that person is giving an accurate rate and if you can even qualify for that bank’s rate because your file has not been vetted by that bank. Instead, you have to go to a provider like myself, someone trusted, who has been in the industry for many, many years and who will read the disclosures carefully with you. That is the key. For the most part, since rates are compressed, when you get to somebody who is well-educated and has a good reputation, you are not going to see much of a rate difference.

Ultimately, it is about the execution. And, the execution can be very difficult if it is not done right.

Appraisals. How often are you seeing appraisals kill a deal in this market?
It’s a big deal. An appraisal is a comparison of the subject property to closed sales. What did similar homes or apartments sell for in the past six months? When you have a rising market like you do in certain areas of Brooklyn, it’s hard to justify some of these values. So, the realtor has to be very sharp and know every possible listing and closing that has occurred while that appraiser has inspected the property and before that report is done – and keep that appraiser informed. Loan officers are not allowed to have contact with the appraiser, but there is nothing stopping the realtor or the owner of the apartment from handing him good comparables.

You would think that the appraiser would do a thorough job, but unfortunately, and I feel for the appraisers, their industry has been gutted. You used to have good appraisers that considered themselves experts in certain areas. I had a great appraiser for the Upper West, one for Upper East Side, downtown, Westchester, Long Island, etc. They knew every street and every house. Their whole life was – they lived there and worked there for twenty years. They were truly professionals. The problem is that when the debacle hit, Cuomo came in and as Attorney General of New York, he went to Fannie and Freddie and said – We are changing this process. You want to close loans in my state? You have to do it this way. He used to regulate Fannie and Freddie when he was in the Clinton Administration, so they followed his lead.

We had a new appraisal rule put into effect. Bank loan officers and brokers cannot have any contact at all with the appraiser. We have to go through a buffer, which is called an appraisal management company (AMC). We order the appraisal with the AMC, the AMC has full contact with the appraiser. And, if we have comments? We can only feed it to the AMC. Now the AMC takes a piece of the pie. They’re supposed to hire the best local appraisers, but they don’t. Most of the time, they are not local! Real estate is local. That is the problem with this AMC system. It should have been done much differently. It is really a shame that Cuomo had very good intentions, which were to get rid of the subprime world, but the execution has destroyed the industry. It’s another major problem in this industry – the appraisal process.

I’m going to jump around a bit. How do you, if at all, work with foreign buyers to get financing?
We deal with foreign buyers all the time. First is the “KYC Rule,” which is Know Your Client because there are strict anti-money laundering laws. They are very strict about it and you have to trace all of the funds. The first thing is that banks will not deal with people from certain countries – Iran, Venezuela, Russia. They will not give financing unless these people have dual citizenship somewhere else. The second thing is that they try to verify their income. We verify with a notarized CPA letter because a notary carries a lot more weight in other countries. We verify their bank statements going back two to three months to make sure that there is no funny business.

I am doing a transaction now for a French citizen who works in the UK and gets paid in Sterling and he is buying a second home here in the US. I was able to trace everything about his income – his assets and even his credit. We showed two months of statements and a transfer to a local checking account and that was it.

Foreign financing is readily available. We do a lot of transactions with foreign buyers both on second homes and primary residences and as investors in co-ops and condos.

Jumping around again, but the question on many people’s minds – how has Hurricane Sandy changed the mortgage industry?
So Hurricane Sandy came in and everybody knows that FEMA started redrawing the flood hazard maps. Now, a lot of homes are in a worse grade, meaning that they are more likely to flood, which makes it harder and more costly to get flood insurance. Also, people who were not in a flood zone are now in a flood zone. This has pushed up the cost of flood insurance and made it hard, if not impossible to obtain flood insurance.

So, what does that mean? A number of banks have said that if you are in a certain flood zone, then they want full replacement cost on the home, which could cost $10 to $20,000 per year. Not just a FEMA flood policy, which could be very de minimus. So, in New York City, you have a building that is in a flood hazard area. The building must maintain flood insurance, which varies based on the number of units in the building. But! Those units that are on the first or second floor usually require additional, supplemental flood insurance. So, you always vet that immediately with the bank to see if they require full replacement. That is why I keep saying that it is all about the execution, not just the rate.

Final thoughts?
I made the move to Sterling because of the platform, the ethos of this bank. They are highly regarded by the regulators, by the community and they service not just the mortgage market, but also the small to middle lending market for asset-based lending, factoring, business lending – commercial and industrial and are very competitive in that space. It is very important to them that every business channel feeds on another. And, they are doing a very good job from what I can tell. Plus, their mortgage processors, underwriters and closers are all located here in the New York-area. They are excellent at closing the transaction.

Jonathan Crystal, Executive Vice President of Crystal & Company

Jonathan Crystal is an Executive Vice President of Crystal & Company, which is one of the world’s leading strategic risk and insurance advisors. Crystal & Company has been in business for over 80 years and three generations of Crystal family ownership and management. Jonathan currently serves as a member of the Executive Committee and as Chief Financial Officer. During his tenure with the Company, Jonathan has served in a number of capacities, most recently leading the firm’s Private Client Services unit.

In your real estate division, what types of clients do you focus on?
We work with a wide range of corporations, institutions and individuals. On the real estate side, we work with developers or private equity firms or investors in real estate. In addition, a significant portion of what we do at our firm involves individuals and their families. That includes property and casualty like homes, vehicles, watercraft, jewelry, fine art and personal liability as well as life insurance.

Since most of my readers are individuals, can you walk through the basic requirements in this day and age for individuals in co-ops, condos and single family homes?
Condos and co-ops. The by-laws of the building are going to define what you’re expected to protect in terms of your property. You’re probably going to be required to maintain a certain amount of insurance by virtue of the building’s rules. There are a lot of misconceptions in terms of what you are responsible for. For example, if there were to be a fire, the building is generally only responsible for restoring your apartment to the four walls, ceiling and original flooring. Anything inside your premises whether it’s cabinetry, new flooring, custom moldings, furniture or any other personal property is likely your responsibility under your insurance program. Making sure that you have sufficient and correct coverage is your responsibility, not the buildings’. Another consideration would be if there were a situation where there was a conflict between you and the buildings’ insurance, it is better to have your own insurance company representing your interests rather than having to deal with it yourself.

A brownstone is a home. So, you have all of the challenges associated with home ownership whether it is leaky roofs or flooding basements. There are certain insurers that specialize in brownstones. And, if you are planning to renovate one, it is important to take that into consideration when selecting the insurer.

Are there any additional policies that you recommend including such as umbrella insurance policies? What about summer rentals or other special circumstances?
One of the things that we consistently see is insufficient liability insurance. I think that a lot of people come to New York, they rent an apartment, they get some renter’s insurance. Maybe they get a little bit of liability insurance, but if they don’t get a car or they don’t drive, then maybe they don’t. I believe that everyone, once they get out of school and are living on their own, should have some amount of liability insurance. At least $1 million. Really, once you get to a point where you get your own apartment and are starting to build up your wealth and want to protect your family, having some basic level of umbrella liability insurance is important. A basic layer of $5 million of umbrella liability insurance is what we would recommend. We created an on-line tool called www.whatsmyliability.com where you can do a self-assessment and get a sense of the right amount of liability insurance for you.

For example, if there is a leak from your apartment and the water drips down into the apartment below, you’re responsible for the damage to the apartment below. And, that, frankly, in New York is one of the most common liability issues. You don’t really know what’s below your apartment. There might be a multi-million-dollar art collection!

Other things to keep in mind. Any time you are doing something that is a little different, it is not a bad idea to pick up the phone and call your insurance broker or agent. So, you may be renting a boat for the weekend to go out sailing with some friends or taking a summer rental. Give a call and say – I’m thinking of doing this. What do you think? Is there anything you think I should be concerned about before I sign the contract? And that last thing is important. Most contracts are written very favorably to the other party and there are often times when you can request a change or insert a specific clause to give you some additional protection and peace of mind.

This is definitely the case when it comes to contractors for renovations. There are two parts to that – understanding what their obligations are to protect you, but also taking a look at their insurance to make sure that it is adequate.

There has been a lot of advertising recently about bundling of insurance policies – auto, home, etc. What is your take on that and is there an advantage to bundling?
There absolutely is. Like anything else in life there are economies of purchasing. You will get better pricing, but you will also get better service from the insurance companies. In an ideal world, we recommend having one insurance relationship that encompasses all of your homes, personal property, vehicles, etc. We find that in those situations where there are multiple insurance agents or companies, it is not just that there may be gaps in coverage, but there may also be duplications that result in additional costs to the client. By bringing everything together, you may even save money.

I think that it is also a missed opportunity to not have one firm that is looking at everything you are doing and anticipating what your needs are going to be. You just bought a new house? That question should lead to – Are you going to be doing renovations? Are you looking to do any type of construction? What type of contractors are you using? Do you want some help looking at the contract to make sure that your insurance is sufficient, that the contractor’s insurance is sufficient? Having a good relationship with someone that you can call on when you have questions can make all the difference.

Lastly, the topic on everyone’s mind – Hurricane Sandy. What fallout did you see among client groups and how, if at all, did you revise your recommendations for your clients?
With every disaster, you learn new things. Hurricane Sandy opened all of our eyes that floods do happen! There are a lot of questions about flood insurance that come up. Banks generally require you to maintain flood insurance as part of your mortgage. You may have a third-floor condo and it doesn’t make sense to you that you are required to carry a flood insurance policy. The bank requirements are the bank requirements. Sometimes they are set at a policy level and they may not make any sense and you just have to abide by them. It could also be that you are in a building where access to your apartment might be limited if the lobby is flooded and you would need to find alternative accommodations. That was a big lesson learned with Hurricane Sandy. In many cases, people’s apartments were not damaged, but they didn’t have heat, electricity or access. Understanding where and when your insurance would and wouldn’t apply is a big consideration.

Hurricane Sandy reinforced the importance of basic preparations and plans. For example, back-up generators for homes outside of the city or having a contact who lives in the vicinity of a secondary home and can check on it for you after a storm. These types of disasters tend to make people refocus on what they need to do to protect themselves and their family. Sometimes the best protection is thinking ahead.

What about the downtown neighborhoods, specifically, with respect to Hurricane Sandy?
The downtown area is the fastest growing area in the city from a residential standpoint. A lot of new developments and new developers. Some of them learned important lessons in terms of response. We have been in business for 80 years. Every disaster is its own, different permutation and we are first and foremost always concerned about families. If you had an alternative place to stay, that’s great. Unfortunately, many downtown families were displaced and depending on what type of insurance coverage they had in place, it may or may not have covered alternative accommodations.

Final thoughts?
Hopefully, an experience like a fire in a home or a flood is the kind of situation that you only experience once in your lifetime, if ever. Having a professional there who can walk you through, step-by-step, is really helpful towards peace-of-mind. And, hopefully, we are there for a lot more exciting occasions! Whether it is planning a big wedding or buying that first piece of art. It’s a lot more fun to work with families over decades and generations. To see them grow and move well beyond their first homes.

Marc Fitapelli, Partner of Fitapelli Kurta

Marc Fitapelli is a founding partner of Fitapelli Kurta, where he specializes in all areas of real estate law and commercial litigation. Throughout his career, Marc has worked on billions of dollars’ worth of real estate transactions from small apartment purchases to complex billion-dollar acquisitions and financings. Marc also has extensive litigation and arbitration experience, focusing his practice on real estate and securities-related cases. Marc has a BA from St. Francis College in Brooklyn, where he graduated magna cum laude and earned his JD from Hofstra University. He is admitted to practice law in New York.

At what point in the buying process should a buyer secure a contract attorney?
I think a buyer should have an attorney as soon as they start looking. It is probably more important for a buyer to have an attorney immediately than a seller. The reason is, we get calls all the time at the very last minute about buyers who have an accepted offer and do not have an attorney. There are a bunch of problems with this. The person is not taken seriously, so if you have an accepted offer and you scramble for three or four days to try and find an attorney, you risk losing a deal because the seller is going to think that you’re not serious. And, you lose a little bit of credibility. Especially in this market, things happen quickly. Three days is an eternity now because people want contracts back in a few days. So, if you don’t have a lawyer lined up, then you’re going to lose a deal and have an upset buyer.

At what point in the buying process should a seller secure a contract attorney?
Sellers should probably have someone when they are marketing a property, especially if there are issues with a property, such as litigation in the building or general financial trouble. It is also critical that these issues be discussed and disclosed to a buyer upfront. The conventional wisdom is that a savvy buyer will eventually learn about major problems during due diligence. As a result, it will save the parties time, money and effort if problems are put on the table at the very start of the process.
Sellers also share a similar risk that “unrepresented” buyers have that there will be a protracted delay in sending out contracts while the seller looks for an attorney. Again, this harms the seller’s credibility and jeopardizes the entire deal. Certainly, however, this risk is much lower in this market.

When choosing an attorney, what are the most important questions to ask?
This is always my pet peeve for doing real estate. Before what questions you should ask, it is what attorneys you should not use. You shouldn’t use your cousin who is a lawyer from Connecticut who does divorces and who is going to help you and do a closing for free. It isn’t going to work and it is going to create problems for everyone. The whole idea with these transactions is that they are relatively simple transactions. They should go forward with very little effort and very smoothly. And, when you have people who don’t do them every day and don’t know anything about real estate, it mucks up the whole process. The questions you should ask are – how many real estate closings do you do every year? I think a decent real estate lawyer should probably do at least 20 closings a year. We do over 100 a year, but I only do real estate. Anyone who does at least 20 per year is probably fairly reputable. If you are buying and selling in NYC, you want someone who has experience in NYC and that has experience with co-ops and condos.

Is there any information that the buyer or seller should disclose to the attorney, upfront?
Sellers should disclose if there has ever been a flood in the building or unit. Along those lines, mold is always a serious concern for buyers. Equally as serious is work without building permits, especially in apartments that were combined. Lastly, any item that has the potential to cost a buyer money in the future, such as a major litigation that is not covered by insurance or major capital improvements. All of the things that a buyer would want to know – if we know about it upfront, the lawyer and the agent, then the sale goes smoother. If you find out about these things once the contract is out, it brings the whole process to a halt. People try to get credits and it just makes everything slower. So, the name of the game is always disclosure and transparency.
For buyers, you should always disclose finances upfront. If you can’t afford an apartment, if you are borrowing money from someone, especially if you are overseas and money is coming from overseas, that is always a big issue.

On the flip side, are there standard questions that you like to ask your clients or potential issues that you like to make them aware of, upfront?
There are things that first time buyers should always know and questions they should always ask. If you are financing, go to the bank right away and make sure that you know what you are able to borrow. Sometimes we get people who have no idea what they can borrow and think they can borrow a lot more than they actually can and they waste a lot of peoples time. They waste their lawyer’s time. They waste their agent’s time.

Other things like tax abatements. Make sure that you have a handle on your tax abatement. So, sometimes people will buy an apartment, especially downtown and in Brooklyn, where there are great tax abatements now and the taxes are de minimus. They think that the taxes will be $500 per year forever and one day they get a tax bill and the taxes have gone up dramatically and they are upset at everyone. It is important to know that upfront because otherwise you will have an unpleasant surprise years down the road and when you go to sell it. It is usually priced into the real estate, so it all nets out.

If relevant to the deal, how important is it to seek out attorneys specializing in certain aspects of the law such as new construction or sponsor sales, or in certain geographical areas, as we touched on before?
Both are important. Specific geographic areas are important because we always have problems with out-of-state attorneys who are not familiar at all with co-ops and condos. So, the first hurdle is getting someone who is familiar with co-ops and condos in New York City because they are not all created equally. Co-ops and condos in New Jersey and Long Island are different than co-ops and condos in New York.

The same applies with new construction. I don’t think you necessarily need someone that is familiar with new construction because if you generally do work with co-ops and condos, it is all more-or-less the same thing.

There is no magic to doing a sponsor sale.

Townhouses are a different animal. If you are buying a townhouse, you want to make sure that your attorney has experience buying and selling townhouses because there are a lot of different issues with townhouses that you wouldn’t get with co-ops and condos. When you have a co-op or condo, the likelihood that you will have a title problem is incredibly low because the sponsor had already bought title insurance. Possibly hundreds of people have bought and sold units in the building. So, the likelihood that there is a title issue is low. With townhouses, that is not the case. Townhouses are hundreds of years old, generally go decades without trading and you may have odd issues appear on a title report or survey. Attorneys that only do co-ops and condos never even look at a survey. They might not even know what it is. So, that is why it is important to have someone who knows a little bit about “dirt” law. There could also be environmental, landlord zoning or structural problems with townhouses – all issues that are not really relevant to a co-op or condo transaction.

Are there any standard changes that you suggest people make to a contract?
I am not big on riders and the reason is because we have a very fair, very good boiler plate contract that was developed by a committee of really bright lawyers and it is tested by courts. So, it has been litigated. Judges have seen this form and its terms have been litigated and interpreted over time. The forms are fair and everyone knows what they say. I don’t really like riders that much because they generally don’t add a lot to a contract. A lot of it is nervous lawyers or people trying to add value, but they are really making things worse for their clients because it causes, sometimes, confusion and problems, especially if things go wrong.

What is the typical timeline from accepted offer to closing, with and without financing?
I think it depends on the market. In this market, there is a lot of activity, but banks have slowed due to the decrease in refinances. Even though we are very busy right now, banks are slow, so financing deals are happening much, much quicker. Under 30 days [from contract signing]. This morning, I closed a sponsor sale. We signed the contract December 7th and we closed today [January 17th] with financing. And, we were ready to close last week! We were ready before the sponsor was ready.

So, typical, I would say, co-ops – 45 to 60 days only because you are dealing with the Board and that is with or without financing. Maybe a little bit closer to the 60 with financing. And, condos – anywhere from 30 to 45 days. But, a lot of it depends on the buyer. I always tell people when they come in and they want to know how quickly they are going to close. Don’t ask me, ask you. How quickly are you going to do your Board package? How quickly are you going to get documents to your bank? And, if you drag your feet, then the process is going to drag. Once you sign a contract, the buyer controls how fast things go because they can slow the process down.

From accepted offer, the signing of a contract should take about a week. In this market, I would say, it probably has to take a week because if you drag your feet for longer than a week, you are probably going to lose your deal, I think. And, we are seeing that more and more.

Can you walk through each party at a closing table?
Whenever I am at a closing with parties from out of state, the one question everyone seems to ask is – who are all these people and why are they here?! At a condo closing with financing, there are three attorneys, two brokers and a title closer. Of course, the buyer and seller will each have their own attorney, but the buyer’s bank will also have their own attorney. At a co-op closing with a payoff and financing, there are four attorneys, two brokers and a title closer. The extra attorney is the payoff bank attorney, whose job it is to collect the payoff and deliver documents to discharge the seller’s loan.

Final thoughts?
The process of buying an apartment is an emotional one and New York City is a unique city with special challenges. Above all else, it is important to have a cool head, a strong stomach and a good team!

Dale Faught, CEO of Nutech Interiors

Dale Faught, CEO of Nutech Interiors, has been a contractor for 36 years. Originally known as Abruzzo Interiors, the family business was started in 1978 by Dale and his uncles, Patrick and Robert. Abruzzo Interiors focused primarily on the build-out of commercial space. In 2001, Dale spearheaded the expansion into residential projects with the establishment of Nutech Interiors. Dale has since worked on apartments, townhouses and homes in the tri-state area cultivating a long and loyal client list including many well-known individuals.

When interviewing contractors, what should people ask about or look for?What I hope they look for in me as a contractor is a person who is not going to play “musical carpenter,” so to speak. A lot of guys are famous for getting your job, showing up for three days and then disappearing for 11. They come back for two, disappear for seven. I don’t do that. If it was my own home, I wouldn’t want someone to do that. I would want them to be present for the entire job. That is number one because what’s fair is fair. You pay them and you expect them to be there. And, what’s a really nice thing is to have the person who is the lead guy stay on the job from day one until the day we shake hands and you get to enjoy your apartment because they get a feel for everything that is going on. Not just carpentry, which is what we do personally, but everybody including the designer. He keeps on top of him or her. He knows everything that has happened including any changes that may occur or any issues. It is good to have that point person there all the time for the whole course of the project. A lot of people don’t do that, so it is a good thing to ask about. Who is going to be the point person, if you have one, for the whole project? Are you going to shift guys around? Because then somebody comes that’s new and he doesn’t know what happened two weeks ago.

[Other good questions are:]

How long have you been in business?

References?

What is the best way for people to choose their tradesman and vendors and is it beneficial if they have worked together before?
Starting with the contractor, if you chose me, for instance, the way we have learned over the years is that I have put together a good team of people that I am comfortable with that are not going to do “musical contractors,” which is the worst thing on a job because it holds up so many…you know, it is like a train. When the caboose hits the back car, it all just piles up. You don’t want that to happen. So, as far as that goes, that is what you are looking for with a contractor. And, it is not always the cheapest price because you get what you pay for. For me, those are the guys that I look for as far as the other tradesman go.

Vendors? You want people that are going to stick by what they say. If they give you a date, you expect the materials to be ready because there is nothing worse than you are ready to tile your bathrooms and it’s not going to be here for another month. The whole process stops. So, I have my preferences of who I like to work with. People who have been honest and on-time. I am sure that all contractors do.

What is the typical timeline for a gut renovation of a two bedroom, two bathroom apartment?
Most gut renovations in pre-war buildings take about six to eight months, on average from the day you start the work and have permits in-hand. Post-war jobs are usually more straight-forward as the walls are normally drywall and not masonry, so installs can be easier. But, the devil is in the details and it can be hard to predict. There are a few parameters that affect that [six to eight month] timeline.

Building access. For instance, when you are doing demo, it is a lot easier to get rolling containers into a building with a ramp as opposed to filling up a garbage can halfway and carrying it down one at a time into and out of a building with steps. Bringing in materials. It really is the access point to the apartment. How smoothly those materials can go in and out and how much manpower you need. That can be a big time-killer.

Another one is people’s false hopes about moving bathrooms around and kitchens, plumbing, chopping into the buildings ceilings and floors. Those kinds of issues can slow things down. Normally that is brought up up-front. Most people know from their lease agreements that they can’t go out of wet-over-wet and all of that type of stuff.

Residential building rules and regulations such as high insurance regulations for contractors. You may go down the path with a contractor to find out at the last minute that he does not carry the correct amount of insurance required by most residential buildings. Then, you have to start your contractor search all over.

Another issue with most residential buildings is their strict work hour rules. Most residential buildings have strict work hours such as 9AM to 4:30PM with restrictions on holidays and weekends. So be prepared for this if you are anticipating a tight schedule.

Bottom line is access and how helpful the building will be.

What is the typical timeline for a cosmetic renovation of a two bedroom, two bathroom apartment? Meaning painting, retiling of kitchen and baths, etc.
Two and a half to three months depending on what they do with retiling.

The above timelines are without the “unknowns.” I did a project one time and lo-and-behold, there is a gas line in the middle of the kitchen that we couldn’t move. Period. So, we had to come up with a unique design to incorporate this pipe that could never be moved into the middle of the kitchen island.

After demolition, the timeline can be shifted based on what you find.

What are some of the steps in the approval process that people do not think about?
Just how lengthy the approval process is. Usually, a contractor does not get involved in those processes besides signing papers that I am the contractor of record, that I have insurance with the city, that I am licensed. Usually, it is the architect and their expediter. From what I see, over the years, it can be a lengthy process. Everything before issuance of permits is a question mark in terms of timing.

Knowing that common saying – expect it to take twice as long and cost twice as much – what are the most common causes for delay and extra expense?
It is usually the “unknowns,” as I said before, or general preference changes or turns out you can’t get a tile when you thought you could, so you have to start from square one again. One of the biggest myths is time. People grossly underestimate how long things take. It is always a nail biter for me. People want schedules, but things change. There are so many variables. On average, you have to give yourself at least 10% more for time. Most people think that the contractor is dragging his feet. But it’s not in my best interest to be there any longer. I don’t make any extra money.

Also, in our company, we have on staff all of our own carpenters with a full service cabinet shop, cabinet installers and a full time crew of delivery staff. Because I can control that aspect, I am able to anticipate delays as it is usually the carpenters that lead the charge and a big bulk of the work. This also gives me better control of what happens and when it happens on a job site. A strict G.C. [general contractor] does not have that control and is reliant on subcontractors and their project schedules.

For a complete renovation, what do you recommend people splurge on versus save on?
If you want to stick within a budget, if it was my own home, I see a lot of people spend crazy amounts of money on tile and stone. If you took a little time, you could really shop around and get almost exactly the same thing. At the end of the day, when you look at it and you can’t reach behind it and turn it around and feel it and it is just tile on the wall, you can save a lot of money.

I would definitely go with central AC. It is more efficient, less costly to run, more green.

Bathroom fixtures are another one. You can go crazy spending lots and lots of money. At the end of the day, a toilet is a toilet and you could spend $5,000 for a toilet that really kind of does the same thing as a $2,000 one.

Wood flooring. It seems like that is a “must” these days. Everybody is looking for a nice wood floor if you want to turn over your apartment eventually. I would definitely spend the money on real wood. There are a lot of faux wood floors, but there is a big difference. If you ever wanted to refinish them, you can’t. Or, one time. With real wood, you can finish it three or four times and it will still look beautiful.

Other cost savings. Built-in’s are invaluable. It is a custom piece that fits appropriately and correctly in the room. It is a little more costly than going to someone like a California Closets.

Kitchen cabinets. You really do get what you pay for. You can spend a fortune on kitchen cabinets that will hold up for a long time.

Painting is a good issue and people ask me all the time. It depends on your level of expectation. The general average person will not know the difference and you can pay a fraction of the price. That can be a big savings.

Technology. A lot of people say, oh we will do it later. Whatever you want now, if you can absolutely afford to do it now, then do it now. You don’t want to be chopping walls when you are living there and running this technology at a later time. Even if you just pre-wire it now. Connecting devices later is a lot cheaper than chopping walls open and ruining your fabulous wall covering. We did a project where the client was very smart about it. She asked her vendor who was doing all of the technology – I want you to pre-wire for me what you see the next technology coming down the road is. These technology guys know what is coming – they read tech magazines, go to conventions and they know what is coming down the pipe. It was interesting to hear this guy talk because he said that the technology that is coming is going to rely on this new type of wire. It wasn’t all that much more money. While you’re at it, you pull in an extra wire. Don’t wait. If you want to do something now, now is the time.

Final thoughts?
Obviously, call Nutech Interiors for your next renovation!

Joan Goldberg and one of her grandchildren

Joan Goldberg taught in the New York City public school system on the Upper East Side for 37 years. She and her husband, Howard, raised their three children on the Upper East Side where they currently reside. All three children attended PS 6 as did Joan and her two brothers, Dr. Barton Hoexter and Dr. David Hoexter.

How many years have you been working in and/or involved in the New York City public school system?

I taught for 37 years in the New York City public school system. The first position I ever had in New York City was on 108th Street on Madison Avenue. Shortly thereafter, I was transferred to PS 6. My mother and I were there at the same time. She was teaching 5th grade and I was teaching 4th. She worked there for 35 years. I was also involved as an active parent in the school system since all three of my children attended PS 6.

How has the network of public schools on the Upper East Side evolved since you started teaching at PS 6 in 1967?
Ninety-Sixth Street has PS 198. Attached to 198 is the Gifted and Talented School there known as the Lab School. In order to qualify, your child must be in the 90th percentile. PS 6 which is located on 82nd Street and Madison is a renowned institution on the Upper East Side. There is PS 190 which is now known as 290 on 82nd Street between 1st and 2nd Avenues and that school has gone through a rebirth, a real phoenix. It has a fabulous principal. What is interesting about 290 is that Shelley Harwayne left Columbia’s TC – Teacher’s College – and she immersed the entire school in the writing program. She created a reading and writing program which was implemented from Kindergarten through 6th grade at the time. PS 158 has been on 77th and York for over 70 years. My father went there. They currently have a very strong math department. PS 183 which is on 68th street – has small classes and generally two classes on a grade for Kindergarten through 3rd grade only. Starting in 4th grade, the class register increases. Then there is 267 which is located on 63rd Street between 2nd and 3rd Avenues. PS 267 was created because there was an overpopulation on the UES and there was no place to put these children and they belonged in a school district. That school has been growing. Right now it is Kindergarten through 3rd grade. It is in brand new facilities. The principal, Medea McEvoy was my next door neighbor at 6. Then she became the Head of Literacy for New York City and finally she took this on as a responsibility. The last school in that border line is PS 59. They have two classes on a grade and they are also in brand new facilities on 57th Street and 2nd Avenue right next to Whole Foods. In this district, there are also several Pre-K’s around and the children are selected by lottery.

Could you mention one major pro and one major area for improvement for the schools that we discussed?
I hear that too often they are so worried about teaching to the test by 3rd grade that they really are just dumping overly creative curriculum. On the other hand, some of the private schools don’t teach as rigorous a program as these schools. Even though there are more children in a class – in private school, there are about 18 to 20 children in a class. The public school has 26 to 28 children. I think that with the public school education, the academic expectations are sometimes higher. They no longer do workbooks. The other difference is that you do have homework whereas you don’t really have homework until the 3rd Grade in some private schools.
All of these schools have creative art programs. They have fabulous music programs and dance programs. Often, the PTA asks the parent body to support these programs. Unfortunately, you only have PE once a week. If you want your child to do some extra physical activity, you will have to enroll him or her in an afterschool center of some sort.

PS 198 – Teaches to the changing community.

Lower Lab – Similar to Hunter, there is a challenging admissions test as well as an interview.

PS 158 – It is very warm, very endearing – great principal. It seems that they specialize in math.

PS 267 – PS 267 is growing. The facilities are beautiful and what they are teaching there is amazing. It mystifies me that she has a dance movement teacher, she has a music teacher, she has an art teacher. And, oh my God – the science room. Kindergarten – they were doing some kind of flies. It is always up-to-date. The science program at 267 was, I thought, just amazing. Their writing and reading program stimulates every child.

PS 290 – The writing program there is supposed to be amazing. And, a wonderful principal.

PS 59 – I know someone who goes there and has been very happy.

PS 6 – On the roof of PS 6 is a prototype for environmental science centers. Another thing to consider is the location of PS 6. Since it is so close to the museums in the area, you pick your child up after school on a Wednesday and you say – “Oh, let’s go over to the Met, it’s a block away. Let’s go down to the Whitney.” It’s just easy to expose your child to the culture of New York City in a relaxed manner. It’s part of being the best of New York. When I was teaching, we would take our clipboards over to the museum and we would sit there and draw and sketch. The teacher doesn’t make a big deal about saying our big trip is going to the Met. You just pick yourself up and go.
In each of the schools on the UES, the parent body is eager to enrich the curriculum. Parents are encouraged to participate in their child’s experience – ie Mystery Reader is when the parent knocks on the classroom door unbeknownst to the child and reads his/her favorite book to the class. Every parent has a chance to be a Mystery Reader. It is not arms-distance about the parents. It is a very inclusive experience for all.

What is the key to ensuring acceptance for your child at the school in your neighborhood?
It is my understanding that your child – if your child is in the neighborhood – they will have first priority. But you have to register and look at the cues when they have the registration. Don’t wait until September because then you will be shut out.

Final thoughts?
I think that you have to visit the school that you are interested in and find what works for you. If you like the warmth of the school, then that’s important. If you like the way the teachers are talking to the children, then that’s important. It is important to find a school where you feel comfortable because then the experience will be beneficial for all.

Note: Two recently opened schools were not discussed in the interview. PS 151 and PS 527. Feel free to visit www.insideschools.org for more information on those schools as well as the ones mentioned in the interview.