How One NYC Co-op Stopped Playing Whack-a-Mole with Water Leaks

Board members struggling with constant water damage need to hear this: Jerry Kestenbaum, CEO of the technology and service provider Aware Buildings, explains how one 220-unit luxury co-op in Sutton Place transformed from having staff literally walk hallways listening for leak alarms to deploying a sophisticated wireless sensor network that catches problems in real time.

Learn how this building invested $85,000 upfront to eliminate the chaos of battery-operated sensors that died at the worst moments, and discover the surprising connectivity solutions that work when cellular signals fail and running new cables isn't an option. Beyond immediate leak detection, Kestenbaum explains the critical insurance implications that could save your building from being dropped by carriers entirely. With water damage claims forcing insurers to abandon "leaky buildings," this technology isn't just about convenience anymore — it's about maintaining insurability and competitive rates in an increasingly difficult market. Habitat's Emily Myers conducts the interview.

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Transcript

Emily Myers: Welcome to Problem Solved, a conversation about the challenges facing New York co-op and condo board directors. I'm Emily Myers with Habitat Magazine, and I'm joined by Jerry Kestenbaum, CEO of the technology and service provider Aware Buildings. Jerry, thanks so much for being here. 

Jerry Kestenbaum: Pleasure to join you this morning.

Emily Myers: So we're gonna talk about leaks and we'll discuss how one building tackled this ongoing problem as a result of their aging fan coil units. And we'll also discuss the savings that can come from a sophisticated wireless sensor setup, not just in terms of leak repair costs, but also insurance. So let's kick off our conversation with a look at a luxury post-war co-op in Sutton Place.

Jerry, can you explain what was going on in this building? 

Jerry Kestenbaum: Yes. This is a about 220 unit set of buildings, north Tower, south Tower, 18 stories. Built probably 60 years ago. And they have fan coil units like many buildings in New York have, which generate condensation water and is supposed to vent down a series of drip pans and condensation pipes and down a condensation riser, going down to the drain in the basement. However, these condensation pipes, lines, pans are notoriously problematic. Dust collects in the top pan. You have backups in the major pipe risers such that in the summer season when there's a lot of condensation being generated from air conditioning systems, they'll typically have maybe one or two or three leaks a week, of water that's overflowing someplace where it shouldn't. 

Emily Myers: Okay. So what did they ask you to do? 

Jerry Kestenbaum: They had a local battery operated thing in place, where residents were asked to purchase these standalone things running on batteries that they could put in their units, and if they got wet, they would beep.

There's two problems. Problem number one is the batteries die and people either do or don't replace them. Problem number two is if you're not home and nobody hears it, it's not doing you any good. And staff used to, walk up and down the hallways during the summer listening for beeps coming from doors.

We were in a meeting with the building that had to be interrupted in the middle because he said, excuse me, somebody's reporting beeping coming from the fourth floor. All hands. We gotta go up there. And the meeting was ended. And they were looking for a solution that allowed them to have a life, that identified sensors in a timely manner with good information and without any of these gaps or emergencies. And we proposed to them our wireless sensor solution, which is running in maybe around 70 buildings in New York City. 

Emily Myers: Okay, so they were relying on these battery operated leak sensors and they were not wirelessly set up in any shape or form, and people were having to listen for alarms. And particularly, like you said, when people are away in the summer it's a real problem.

So what was the solution that you presented? 

Jerry Kestenbaum: We have special long range technology, it's called LoRaWAN, that we have been working on for about six or seven years, that allows wireless signals to cover buildings, many floors, many apartments in the building very effectively. Unlike the usual wireless technologies that people know about, Bluetooth, Zigbee, Z-Wave, that usually is good for about 50 feet. You'd have to have hundreds of gateways in place if you weren't using this special wireless technology that we use, which is a standard. But implementing depends upon each particular vendor's know how to implement LoRaWAN.

So we proposed to them a LoRaWAN solution which would allow them to pretty much cover both of the 18 story buildings, around 36 stories, with around 15 gateways in total, maybe one every few floors covering from apartment to apartment, end to end. And this is a solution that the batteries would last for over 10 years and they get battery alerts because it's a wireless communication platform.

So they would know if batteries needed to be changed and this would check for moisture more often than once a second, and would alert them immediately and alert them through cell phone, through email. They even acquired our annunciators, which is a speaker box. We propose that they have three of them because they have different people that want to respond to leaks at different time of the day.

So one speaker box annunciator is in the maintenance department. When they're not available to answer it, there's another one in the management office, and when the management office is closed, they have another annunciator by the front desk. So one way or another, when there's a leak, there are three places in the building where it says, attention, attention. There's a leak in 7B, dishwasher. 

Emily Myers: So to sum up, you were solving both the sensor problem and a connectivity issue within the building. 

Jerry Kestenbaum: Yes. This building, as in many buildings in New York, have connectivity issues.

Primarily any monitored wireless solution has to connect up to the internet somehow, some way. The cellular signals in the building, at least for T-Mobile, were bad. They had no ability to run conduit up their stairwell and still remain within code. And core drilling to run an ethernet cable would've cost them a fortune.

And they also wanted everything to be hidden and they weren't going to use residents' internet connection. So they needed something tucked away with no ability to run it. We spent around six months exploring the different options for them. And we learned a lot. And they learned a lot. And you're probably wondering, okay, so what did you end up doing?

We did two things. We used a special technology called Power Line Ethernet, which brings internet up through the outlets in their compactor rooms that are vertical line of outlets. Special technology that lets you overlay internet over electrical wires without having to run any wires. And that's basically covering both buildings for 18 floors.

In addition to which, we found one cellular provider that actually had good service in that building. And we have special tri band cellular chips that we can divert to different networks. So we also connected up their gateways as a backup to that one cellular provider. The provider has not agreed to pay us for placements.

And so we got them running with two connection methods, with a very efficient wireless coverage across both buildings, and with sensors with attached leak ropes that allow them to detect multiple points in a fan coil unit, exactly where it gets wet. As a matter of fact, the super in that building wanted an additional sensor that he could put on the ground exactly at a height that he wanted to put it over some wood crack, and he helped invent a movable little probe that you can adjust with a screw, the height of those pins.

So the staff got actually involved in perfecting the nuances of it. And a very robust alerting mechanism between the enunciators, the cell phone alerts, the text message alerts the systems working finally very well, and we learned a lot from that job. We learned a lot about cellular connectors and a bunch of other things.

Emily Myers: And so what was the cost of the work that you did for them? 

Jerry Kestenbaum: The cost of that job was around $85,000, and that was for around 1200 sensors deployed across all these different apartments and the 15 gateways and the internet connectivity as well. 

Emily Myers: And are there ongoing costs for the building?

Jerry Kestenbaum: There is. The ongoing costs are around $17,000 a year, and for that $17,000, our network monitors every single one of those sensors, which is a little computer, and it tells them to power up if they're not broadcasting strongly enough, or power down if they're shouting and they're interfering with other sensors. It's very sophisticated technology. And we have heartbeats every hour.

It's like getting a report card from school every hour. How are you doing? It would drive you crazy if you were a person, but sensors don't have feelings, so we don't mind doing that. And so that ongoing cost pays for the monitoring, the tweaking, the alerting, the database backup. And and the other thing which I'm not gonna go into here right now is that the beauty of it is once you deploy LoRaWAN in your building, your entire building is already preset up for any other sensor that you want.

So you can put in door sensors, temperature sensors. We've also been playing around with some special situations. They have some shutoff valves that are in the crawl space above their penthouse. And whenever they have to shut off those valves, they have to ask permission to crawl up on top of someone's roof.

We're working with them and deploying remote valve shutoffs. And none of that requires any new architecture because once your building is covered, it's covered. And they've been catching leaks and their staff don't have to run around.

I think they even built a special crash cart on wheels specifically for water leaks, with towels and this and all that kind of stuff, so that when they get an alert, they grab the crash cart and they go to where the leak is supposed to be. 

Emily Myers: Excellent. So you said it was a six months period to figure out the solution?

Jerry Kestenbaum: Largely the internet portion. I should say that right now we are able to deploy in, we've done even 50 and 60 story buildings in a week. Because of everything that we've learned we have a very robust bag of tricks for how to make this thing work in different trying conditions.

Emily Myers: And of course the benefits, as you pointed out, leaks are detected, they're detected fast and they can be dealt with and that can avoid further damage. But there are implications as well for insurance coverage. 

Jerry Kestenbaum: Yes. As far as the leaks themselves goes, you have to look at the total cost of a leak in a residential building.

It's not just the direct damage, it's the detrimental cost of having your apartment under repair and contractors coming into your building to sand, to paint, to this, that, and the whole inconvenience during which you're paying maintenance and everything. And so the total cost of a leak, and the inconvenience in a co-op or condo is much, much greater even than just the direct costs, but the direct costs can be very significant. As far as the insurance goes, buildings, if they have leverage with their insurance company, can ask for little discount. And we have some buildings that have gotten $5,000 discounts or 3% discounts. But a lot has changed in the last three or four years. Insurance companies have come to really detest the water leak exposure because they can't quantify it.

You know, insurance companies make money by quantifying risk and charging a premium that covers that likely risk. But if you could have a building with no water exposure, that all of a sudden has a $3 million loss because something cascaded down five floors. So they're raising deductibles tremendously and premiums.

And also they're dropping leaky buildings. They're just saying at renewal time. I can't deal with your building. So the real savings from insurance comes not so much in terms of an insurance company's going to give you a little bit of a discount, because what good is that if they're raising your rates 10% next year?

Yeah, you got your discount. Trust us. The real savings comes when you are a desirable building for an insurance company to have as a client. Because then you get competition. If you get to the point where there's only one insurance company that wants your business, you've lost all your leverage and that leverage is worth 10% or more.

That's the real trick. And it takes a good two years to develop a leak loss record, to be able to show an insurance company actuarially, look, this is our exposure, not that. We've done what we need to do, who wants to insure us? And hopefully the companies will line up and bid for that business.

Emily Myers: Yeah, that's a really important takeaway for other boards. Jerry, thank you so much. Jerry Kestenbaum, CEO, and founder of Aware Buildings. 

Jerry Kestenbaum: Thank you. I'm happy to be with you and your audience this morning.