How A Local Community Avoided Their Own Tragedy
The air was warm on that fateful morning of June 24, 2021. News of the beachfront Champlain Towers, a condominium complex partially collapsing in Florida, was heard around the country. It was announced that at this moment one person was found dead and 99 people were unaccounted for. The immediate question burning in everyone’s minds was how could this have happened?
News reports state that this tragic event was likely a direct result of poor planning, underfunded reserves, dissension amongst board members, and tension between homeowners. Engineers warned the community was plagued with crumbling concrete and corroded rebar. It even appeared that the Association had known about the major structural repairs for at least three years prior to the deadly collapse and was merely days away from collecting on a $9 million dollar special assessment in an effort to make major repairs to the community.
This tragedy immediately caused an uproar in the community association industry. Condominium complexes and board members everywhere contacted their community managers to inquire about what they could do to help prevent something of this magnitude from happening in their homes. Industry professionals quickly held question and answer sessions to help folks understand and navigate their next steps. Little by little we saw communities taking action to protect their residents and investments. This type of proactivity from Board Members is what we could only hope for to aid aging and failing communities.
A community located in Encino, CA, which I managed years ago, was also faced with failing common area components, pending litigation, and looming special assessments in the millions.
This community had numerous common area components in danger of failing, as identified by the Los Angeles Department of Building and Safety (LADBS). The issues included a leaking pool and spa area, with water going through the garage ceiling, a podium deck in need of waterproofing, and elevators in immediate need of modernization, just to name a few. At the time, the Association was experiencing legal issues with a contractor who walked off the job and was currently in litigation. The homeowners at the community had differing opinions on what needed to be done and many were very vocal about their points of view. In a short period of time, a new Board was elected and they immediately got to work.
The board instantly worked with their management team to interview quite a few construction managers, bank loan representatives and vendors to properly vet and obtain information as to how they could effectively tackle the obstacles at hand. They spent months and months vetting industry professionals until they landed on the vendors that were to do the project. All while the board got harassed, yelled at, and disliked by many owners. Clearly there was a high level of stress among the residents, but the Board persevered. Once they landed on the vendors and final numbers, announcements were underway to inform the Association of the coming assessments. Eventually, what was needed to accomplish this project was a bank loan just shy of $5 million dollars, a per unit special assessment of $40,000, and an emergency assessment of about $9,000.
As you can imagine, the community had an uproar, but plans continued and commencement of construction was finally on the horizon. The board held frequent meetings and town halls to keep the community informed about the project at hand. They exercised their legal rights as board members and voted to levy emergency special assessments, made the difficult decision to push through a massive special assessment, approve a bank loan, and spent countless hours working with the construction, legal, and management teams to see this project through. Fortunately, the Board did not back down when faced with much adversity from the community. What came of this project was a new courtyard and podium deck, new pool and spa area, modernized elevators, and a garage free and clear of any structural issues and car-sized smitty pans! This complex was now deemed safe by the Los Angeles Department of Building and Safety, thanks to the Board they had in place.
As a community manager we are all faced with many different challenges and communities with their own set of unique issues. It is our job to help identify potentially dangerous issues and to keep our boards informed. After hearing and seeing the situation that happened in Surfside, FL, I believe managers and board members will become more astute in their observations and more proactive with the management of their buildings. As we move ahead, I would suggest that us managers do more site inspections and meet with industry professionals, such as construction managers, who may be more qualified at identifying potential problems and issues. Many vendors would be happy to be given the opportunity to do this and even write up a report for you at a nominal fee. Should any issues seem to be of concern or if ignored get progressively worse, I would encourage the board to meet with and interview the construction managers, who can help communicate and outline the severity of the issues at hand. It is advisable at times to get multiple opinions and seek multiple bids so that the Association can properly budget for repairs. If funding is required, determine if the items can be replaced with reserves and evaluate whether or not there is enough money in account. More than likely, a special assessment will be needed and perhaps seeking a bank loan for funding, may be an option. I would suggest reaching out to legal counsel for more guidance on these topics.
Once any community decides to undertake a major project, which can potentially impact the quality of life for its residents and their financial situation, over communication is always advisable. Keep the community informed of the steps being taken by way of notices and town halls. The more information that is disseminated, the more educated your homeowners will be. This will help to keep the project moving more smoothly and help the community to make more informed decisions. As always, with any major construction project, it is always advisable for the Association to consider employing a construction management company to help with a multitude of tasks. Including holding construction companies accountable, ensuring the Association stays within budget, and to ensure the project gets completed in a timely manner, among other things. As exemplified by the Encino community, difficult and imperative tasks can be accomplished so long as the Board stays focused and determined to do what is necessary, despite the challenges they face.
Once all the rubble has cleared, what is left now at 8777 Collins Avenue is an empty space filled with memories. The people lost in this horrific event will forever remain in our hearts and our industry will forever be changed because of this tragedy.