Why You Should Include Your Attorney in the RFP Process

We look at relationships between the Cooperative and the management agent similar to the context of marriage. We all hope things will last forever, but if the percentages are anything like actual marriages these days, the odds are things won’t always work out. In those instances, the cooperative lawyer needs to get you back in the dating scene to find a comparable mate who will oversee the many operations for the property. Some boards might think they don’t need a matchmaker because the costs of the lawyer may be unnecessary. Well, we see first hand how complicated and inefficient the process can be when not shepherded by the corporate attorney. Here are a few examples of how we make the process easy on you:
 
 

A. Streamlines the process making it orderly and time-efficient:

The Coop attorney will first work with the board to see what timeline we are working with to complete the interview process, to assure there is adequate time to contact candidates, submit their Request For Proposal (RFP’s), be interviewed, select a candidate, negotiate the terms of the management contract and still allow for some transition time prior to the outgoing Management agent’s term expiring. If you only have 60 days to find a new Management agent, time is of the essence and a streamlined process is essential.
 
 

B. Recommendations on Candidates:

 
The coop attorney will assist in providing some recommendations on possible qualified candidates. Just opening up the phone book for property managers doesn’t guarantee they know boo about cooperatives. In a recent RFP process where our office had not been initially consulted about the process, 3/4 of the candidates the client had scheduled for interviews had NO current cooperative clients or cooperative experience. They even contacted candidates for phone interviews without RFP’s being submitted, among other problems. These unforced errors cost time, which you don’t have.
 

C. Assist with the RFP:

 
The coop attorney will assist you in what types of questions to ask and not to ask. Many of the questions we have seen from clients who have done their own RFP’s maybe so tangential or specific that it may be better suited for the interview itself. Also, we will assure references are provided. Board Members should contact these to gain insight and to how the candidate is seen by their own clients.
 

D. Keeping you anonymous:

 
We feel It is also preferable that your identity stays anonymous as long as possible. Word travels quickly in this day and age, and some management companies will attempt direct contact with you once they know you are looking. The coop attorney keeps your identity unknown as long as possible to prevent this from happening. If it does become known to the management candidates who you are, we will assure they keep us as the sole contact to avoid direct communications with you which keeps the process level and even-handed for all candidates. Keeping things quiet with the members is also important to avoid any information about the process leaking to the candidates. We have seen major problems when too many chefs are in the kitchen.
 

E. The Interview Process:

 
The Coop attorney will assist in coordinating interviews with the candidates, routinely participates in the interviews and can help create a template of questions to ask based on your specific needs. The Coop attorney also has insight as to why a particular mgt agent may be a good fit or why they may not. Obviously, our role is not favor any candidate, but we sure will know who specializes in cooperatives, who goes to MAHC or NAHC for training, who might or might not have the capacity to take more clients, who might have issues being approved by HUD or the lender, etc. Use our insight to better guide your process.
 

F. Management contract negotiations:

 
Once a candidate has been selected, the attorney will work out the terms of the management contract to assure essential terms are mandatory, such as indemnification clauses and to assure there are not “add on” costs that were not a part of the original bid. We will also assure there is an easy out clause without cumbersome termination provisions. Any candidate that insists that you can’t terminate the contract with or without cause upon 60 days notice is a deal-breaker. We will assure you will have the freedom to terminate if that need ever happens.
 
The RFP process can be challenging. You are back on the dating scene and not a lot of time to find a new mate. Use your cooperative attorney to make the process less daunting than it would be if you try it alone. You and your members will thank you for it.
 
___________________________________________________________________________________
 

Creighton D. Gallup, Partner with Pentiuk, Couvreur & Kobiljak, P.C., spearheads the firm’s Landlord Tenant Litigation Department. His tenacity and superb negotiating skills serve his clients well. He has drafted proposed legislation exempting housing cooperatives from the Michigan Truth in Renting Act and the Michigan Consumer Protection Act. Creighton is a frequent instructor at NAHC and MAHC where attendees benefit from his many years’ experience working with management companies and housing cooperative boards.

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Why You Should Include Your Attorney in the RFP Process

We look at relationships between the Cooperative and the management agent similar to the context of marriage. We all hope things will last forever, but if the percentages are anything like actual marriages these days, the odds are things won’t always work out. In those instances, the cooperative lawyer needs to get you back in the dating scene to find a comparable mate who will oversee the many operations for the property. Some boards might think they don’t need a matchmaker because the costs of the lawyer may be unnecessary. Well, we see first hand how complicated and inefficient the process can be when not shepherded by the corporate attorney. Here are a few examples of how we make the process easy on you:
 
 

A. Streamlines the process making it orderly and time-efficient:

The Coop attorney will first work with the board to see what timeline we are working with to complete the interview process, to assure there is adequate time to contact candidates, submit their Request For Proposal (RFP’s), be interviewed, select a candidate, negotiate the terms of the management contract and still allow for some transition time prior to the outgoing Management agent’s term expiring. If you only have 60 days to find a new Management agent, time is of the essence and a streamlined process is essential.
 
 

B. Recommendations on Candidates:

 
The coop attorney will assist in providing some recommendations on possible qualified candidates. Just opening up the phone book for property managers doesn’t guarantee they know boo about cooperatives. In a recent RFP process where our office had not been initially consulted about the process, 3/4 of the candidates the client had scheduled for interviews had NO current cooperative clients or cooperative experience. They even contacted candidates for phone interviews without RFP’s being submitted, among other problems. These unforced errors cost time, which you don’t have.
 

C. Assist with the RFP:

 
The coop attorney will assist you in what types of questions to ask and not to ask. Many of the questions we have seen from clients who have done their own RFP’s maybe so tangential or specific that it may be better suited for the interview itself. Also, we will assure references are provided. Board Members should contact these to gain insight and to how the candidate is seen by their own clients.
 

D. Keeping you anonymous:

 
We feel It is also preferable that your identity stays anonymous as long as possible. Word travels quickly in this day and age, and some management companies will attempt direct contact with you once they know you are looking. The coop attorney keeps your identity unknown as long as possible to prevent this from happening. If it does become known to the management candidates who you are, we will assure they keep us as the sole contact to avoid direct communications with you which keeps the process level and even-handed for all candidates. Keeping things quiet with the members is also important to avoid any information about the process leaking to the candidates. We have seen major problems when too many chefs are in the kitchen.
 

E. The Interview Process:

 
The Coop attorney will assist in coordinating interviews with the candidates, routinely participates in the interviews and can help create a template of questions to ask based on your specific needs. The Coop attorney also has insight as to why a particular mgt agent may be a good fit or why they may not. Obviously, our role is not favor any candidate, but we sure will know who specializes in cooperatives, who goes to MAHC or NAHC for training, who might or might not have the capacity to take more clients, who might have issues being approved by HUD or the lender, etc. Use our insight to better guide your process.
 

F. Management contract negotiations:

 
Once a candidate has been selected, the attorney will work out the terms of the management contract to assure essential terms are mandatory, such as indemnification clauses and to assure there are not “add on” costs that were not a part of the original bid. We will also assure there is an easy out clause without cumbersome termination provisions. Any candidate that insists that you can’t terminate the contract with or without cause upon 60 days notice is a deal-breaker. We will assure you will have the freedom to terminate if that need ever happens.
 
The RFP process can be challenging. You are back on the dating scene and not a lot of time to find a new mate. Use your cooperative attorney to make the process less daunting than it would be if you try it alone. You and your members will thank you for it.
 
___________________________________________________________________________________
 

Creighton D. Gallup, Partner with Pentiuk, Couvreur & Kobiljak, P.C., spearheads the firm’s Landlord Tenant Litigation Department. His tenacity and superb negotiating skills serve his clients well. He has drafted proposed legislation exempting housing cooperatives from the Michigan Truth in Renting Act and the Michigan Consumer Protection Act. Creighton is a frequent instructor at NAHC and MAHC where attendees benefit from his many years’ experience working with management companies and housing cooperative boards.

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