Managing the Cooperative’s Finances
Every month, the Board reviews the financial statements from our management company and ensures that we are meeting our obligations, particularly around our mortgage and sticking to our overall budget.
Every fall the management company recommends a budget for the following year to the Board. The Board considers any additional needs and reviews the long term needs of the Cooperative for long term maintenance and capital replacement in finalizing the budget. The Board usually considers an increase of Carrying Charges (rent) about 3-5% per year. This helps maintain our cash reserves and avoids sudden large changes in our carrying charges.
The Cooperative has a blanket mortgage loan that is refinanced periodically. This helps provide longer term financing for replacing capital items like HVAC systems, roof replacements, and other structural and infrastructure needs.
In 2025 Belmont Chambers had a Capital Reserves study done to identify future capital needs for the building in preparation for refinancing the primary mortgage. Since the previous reserves study the Cooperative has renewed the roof, replaced virtually all of the Unit HVAC systems and is planning for a imminent refresh of the common areas. Additional areas identified in the new study include some external masonry work and replacement of the windows.
In July of 2025 we refinanced the primary mortgage on the building with Cooperative Fund of the Northeast (CFNE), which provides financing and technical support to Cooperatives. CFNE is a community development finance institution (CFDI) whose mission is to support cooperative and democratically run enterprises.
Applicants are encouraged to ask questions, but during orientation approved applicants will learn more about the financing structure of the Cooperative including budgeting and financial statements. We’ll also supply a copy of the Capital Reserves study and discuss current capital plans and its possible impacts on the cooperative’s finances. After the orientation, an approved applicant should have enough of an understanding of the finances to make a decision about purchasing the unit.
Owner/Shareholder Equity and Market Value
The equity in the building is represented by the Cooperative Corporation’s shares. Because of the covenants and the mortgages, and a Right of First Refusal held by SART, it is unlikely that the building would be sold on the open market, and so the notion of a market value is academic to the operation of the Cooperative. The maximum resale price of the Cooperative shares is limited by a limited equity formula to a 5% annual increase. Practically speaking, however, the actual transfer price of the Cooperative’s shares is limited by available financing and the income limits imposed on applicants.
Applicant Due Diligence
The foregoing is just an attempt to broadly summarize certain aspects of the Cooperative’s financial structure. A purchaser should, with their attorney, always review the actual documents, available on request from the Cooperative and in some instances on-line in the Suffolk Registry of Deeds. If there is a conflict between the terms of the actual documents and this summary, the terms of the actual documents shall control.