CIC Info Bytes

09.05.24

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ISSUE # 98

CIC Info Bytes 09/05/24


CIC Info Bytes are frequent, succinct updates providing educational and engagement opportunities that help your community thrive!  Please forward and share this newsletter with your peers, neighbors and colleagues so they can connect and joinOur goal is to curate content that provides a robust basis for contextual understanding to support practical takeaways for you and your association.  Please consider following us on Twitter and Reddit. 

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CIC Info Bytes Newsletter 09/05/24 - PRINT EDITION

EVENTS

Condo Connection CIC Info Bytes Newsletter Database (DB)

Ethical…Lapse

CAI Updates Professional Code and It's Still Meaningless — u/UnfuckHOA | r/FuckHOA | September 2, 2024

CAI Updates Professional Code and It's Still Meaningless

…“It’s ridiculous. Point blank, absolutely ridiculous," David Martin, who's been giving away the water for four years, said. “I’ve done it for four years and I’m not going to stop.”...

David's neighbor Larry Marks stops by for free water a few times a month for him and his dog and strongly disagrees with the HOA's actions.

“I think it’s horrible and atrocious," Marks said. "I think they should focus more on improving our community than fining someone giving out free water.”...

…Ever since May 2024, FS Residential, the company that over the Canyon Trails’ HOA has been fining David. It started off as a $50 fine in May, increased to $100 every month after, and could continue to go up, Martin said…

VIDEO: 4 years ago, a Valley man started giving out free water. Now he's facing fines from his HOA — Troy Lynch | KPNX | September 02, 2024


Goodyear HOA fines homeowner for 'free water' sign? That's a drought on common sense — Laurie Roberts | Arizona Republic | September 03, 2024


To beat the heat, an Arizona man offers free water. His HOA is fining him. — Daniel Wu | The Washington Post | September 04, 2024

4 years ago, a Valley man started giving out free water. Now he's facing fines from his HOA

The Columbia County Sheriff's Office recently was called to the Tudor Branch neighborhood in Grovetown to investigate a dispute between the homeowners' association and a resident.

A 32-year-old man called the sheriff's office Wednesday to report that some of the items in his yard were taken and his garden was vandalized on Aug. 21, according to an incident report from the sheriff's office.

The man told deputies the HOA hired a landscaping company to "fix" his yard and they disassembled his garden in the front and back of his home without his permission…

Columbia County deputies called when HOA 'fixes' Grovetown man's yard without permission — Alexandra Koch | The Augusta Chronicle | September 3, 2024


What is your HOA’s Risk Temperature? — Sharon Glenn Pratt | ECHO | January 2021


HOA flipping out over black house — r/MoPanic | r/FuckHOA | September 02, 2024


…Then there was Robert and Lola’s 12-year-old son, who had gotten pudgy and needed exercise. He was interested in basketball and wanted to practice at home. There was, however, a strict rule against attaching basketball hoops to houses and garages in the development. Hence, Robert and Lola purchased a regulation-size portable basketball hoop, which the they set up on one side of their driveway. Problem solved? Not really. The HOA demanded that the portable hoop assembly be collapsed and stored out of sight after each use. An unattended basketball hoop out in plain sight? There goes the neighborhood!

The culture of bullies who run American's homeowners associations (alternate link) — Ed Palm | Kitsap Sun | August 31, 2024


…A receiver appointed to manage the property sent a survey last week to owners outlining two options: an up-front assessment of at least $40,000 or selling the property…  

…The saga began in August of 2023, when residents in over half of the buildings at the condo complex were ordered out after the city of Pembroke Pines deemed them unsafe. 

But in July of 2024, engineers released a new report indicating their inspections at the property revealed even deeper issues. Along with the visible structural damage, engineers cited inadequate design and construction of the complex, prompting concerns the buildings may not withstand high winds.

The city then ordered the residents of all 304 units to be out by Aug. 29….

VIDEO: All residents of Heron Pond, condo complex deemed unsafe, must leave by today — Chernéy Amhara and Amy Viteri | NBC Miami | August 29, 2024


VIDEO: Heron Pond Condominium residents facing tough choices after being ordered out — Amy Viteri | NBC Miami | August 13, 2024


It happened at Driftwood Manor just off Western Boulevard. This is not far from NC State University.  Most of the damage happened on the second floor of the building…

4 people, 2 dogs displaced after fire at Raleigh condominium complex — ABC 11 | August 23, 2024


Approximately 35 people have been displaced after a fire at a condominium complex in Loveland, Fire Chief Otto Huber said.  Police were called about a fire at Carrington Crossings just after midnight…

…According to Huber, one of the residents said she was using "burn tools" for fingernails. The resident said she thought she put the fire out but it spread.  Huber said the fire started on the second floor and spread to the roof, attic and other units before it took over the entire building.

The second floor eventually collapsed due to the fire, Huber said…

'I heard people screaming' | Condominium fire in Loveland destroys 24 homes — Chloe Franklin and Sean DeLancey | WCPO 9 | August 21, 2024


One person was taken to the hospital, according to Con Fire. Their condition is unknown at this time. Firefighters were able to rescue one dog, but another dog was found dead…

The fire began in the middle unit of the condominium, officials said. The cause of the fire remains under investigation.

Person hospitalized, dog killed in Antioch condominium fire — Aaron Tolentino | KRON 4 | August 21, 2024


…“Obviously, people who bought recently are more adversely affected because their investment is essentially gone versus the people who bought 30 years ago,” said Wagner. “They have a lot more equity in their property.”

Wagner said it is hard to protect your investment when natural disasters come into the equation.

“As far as what you can do to protect yourself in these situations, it’s an act of God,” said Wagner. “Nobody could predict that Hurricane Ian would come and make landfall with the perfect conditions creating such a high storm surge. It’s just not something you can predict.”...

VIDEO: Strandview Condominium demolition underway — Jillian Haggerty | Wink News | August 23, 2024

Strandview Condominium demolition underway

...the government in Bern broadly supported a plan to force all property owners to contribute to the cost of earthquake repair. This week, a Swiss homeowners association rejected the idea, reported SRF.

The government plan is a response to the attitude of many home owners towards insurance. Only 15% of buildings are insured against earthquakes in Switzerland, a nation at risk, according to a government estimate. If some homeowners won’t step up and pay for earthquake insurance then they should all be forced to pay when an earthquake hits whether their building is damaged or not, is the logic. Some politicians view the scheme as innovative. There are no premiums but instead a (big) bill when an earthquake hits – 0.7% of a property’s insured value would be demanded from all property owners in the event of an earthquake.

However, the Homeowners Association does not agree. Director Markus Meier told SRF that private insurance companies provide enough competitive insurance offers. There is no need for a mandatory requirement…

Swiss homeowners association rejects government plan to charge all home owners for earthquakes — Le News | August 30, 2024


CBRE has arranged a lease renewal and resizing for Spectrum Association Management, a locally-based HOA property management firm. The company has shrunk its headquarters’ footprint at North Park Corporate Center in San Antonio from approximately 27,000 square feet to 19,738 square feet.

In doing so, the company expects to save around $250,000 per year in overhead costs.

Founded in 2001, Spectrum Association Management works with hundreds of homeowners associations in Texas and Arizona. The company serves single-family neighborhoods and has designed its management services to meet the needs of board members and homeowners through a modern approach, innovative technology, engaging homeowner experience, and unique board member resources…

CBRE negotiates lease renewal for HOA property management firm in San Antonio — REJournals | August 29, 2024

Coverage: 1,  2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35, 36, 37, 38, 39, 40, 41 and 42 

Energy

It’s a really horrible feeling because nobody likes to not have enough money to pay their bills… People just think that because we chose at some point to live in a hot state that we should just suck it up.  That’s not right… — Lisa Harjo 

…We found that one in four households use some kind of risky temperature strategy in order to cope. Now here, these are things such as burning trash in your home or running a space heater, which we know to be one of the leading causes of fire in the United States, or opening your oven or flaring your gas stove for space heating, or running your dryer, but disconnecting the dryer vent and putting somebody behind it in order to warm your body temperature.

We also know that one in four households carry debt across their energy bills, and approximately one in five households engage in this kind of bill balancing that you heard about just a minute ago, where one might pay down one energy bill or one mortgage bill, for example, one month, and then pay down a different bill the next month, and approximately one in five households have to forego paying for food in order to pay their utility bills…

— Sanya Carley | University of Pennsylvania Kleinman Center for Energy Policy

VIDEO: American households struggle with sky-high energy bills during extreme summer heat — John Yang and Claire Mufson | PBS Newshour | September 01, 2024


VIDEO: Americans' electric bills are rising along with the heat, survey finds — Kate Gibson | CBS News | August 08, 2024


Millions struggle to pay AC bills in heat waves. Federal aid reaches only a fraction — Jesse Bedayn | AP News | August 09, 2023

American households struggle with sky-high energy bills during extreme summer heat

Electricity is getting more expensive.  Read more about these rate hikes in Issue# 94.

Seattle council approves rate-hike plans for utilities, electricity — Daniel Beekman | The Seattle Times | September 03, 2024

Seattle council approves rate-hike plans for utilities, electricity

An Interview with CBO Economist Evan Herrnstadt: Insights on the Congressional Budget Office's Findings on Flood Risk, Insurance, and Effective Adaptations

First Street | September 05, 2024

CBO’s Recent Analyses of Climate Change, Flood Damage, and Mortgages — Congressional Budget Office

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Schaumburg, Illinois: Water mains are breaking.  Wallets are aching.  Find more water main woes in Issue# 94 and in our database.

For a second time this month, a break to a private water main displaced residents of a 143-unit condominium building in Schaumburg for an unknown amount of time as repairs are made.

Both instances occurred at 1463 Mercury Drive in the Country Lane Park Condominiums, near the intersection of Irving Park Road and Fairfield Drive. The latest occurred Tuesday.

Village crews first responded Aug. 6 for a break on the private service line coming into the building that caused damage to the nearest first-floor units, Schaumburg Communications Director Allison Albrecht said…

Water main break displaces residents of Schaumburg condo building a second time this month — Eric Peterson | Daily Herald | August 23, 2024

Housing Market

The real estate market in the Greater Toronto Area (GTA) is interesting from a younger generation perspective, specifically with the decline of condominium sales and the rise of townhomes/semi-detached/detached home sales.

Condominiums in the past were affordable and the primary purchase of first-time buyers. Their low cost and almost immediate equity return made them enticing for young purchasers. However, this is not as common these days…

Young GTA buyers shift from downtown condos to suburban homes: Here's why it's a problem — Noor Gill | Real Estate Magazine | August 26, 2024

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Florida’s condominium market in shambles. Also see Termination Overruled in Issue# 96.

The condo market is entering a free fall.

Unit owners are running out of time — and options. Meanwhile, Florida’s 3rd District Court of Appeals sits on a case that could unleash new opportunities for unit owners … or make today’s condo crisis a real catastrophe…

While Florida’s 3rd DCA sits on the Biscayne 21 case, the condo market is collapsing — Peter Schorsch | Florida Politics | September 01, 2024

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Florida and Texas: Condominium inventory soaring.

…Condo inventory soared 53% year-over-year in Florida in July, per Redfin data, while condo inventory climbed 42% in Texas in the same timeframe. Those increases far exceed the national average, with condo inventory rising 27% nationally in July.

Jacksonville, Florida, saw the steepest climb in inventory, with the supply of condos soaring 81% from levels last year. That was followed by Orlando, Florida, and Fort Worth, Texas, where condo supply soared 68% and 65%, respectively, over the last year.

Condo buyers have been put off by rising HOA fees and insurance premiums in both states, Redfin said. HOA fees have climbed more than 15% from levels last year in key Florida metros, Redfin found in a previous analysis…

Housing supply is piling up in Florida and Texas as HOA and insurance fees jump, Redfin says — Jennifer Sor | Business Insider | September 04,, 2024

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Florida: Mass exodus to four other states, Mexico and Central America.

…Miami Real Estate Agent Steven Kupchan told DailyMail.com people are flocking to Georgia, Texas, the Carolinas and even moving out of the country to places like Mexico or Central America.

'With the rise of remote work, some individuals who had moved to Florida for work reasons are now considering relocating to states with lower living costs or more stable real estate markets,' Kupchan said…

Four affordable states where desperate Florida condo owners are fleeing to amid real estate crisis — Rachel Bowman | Daily Mail | September 03, 2024

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Developer Bankruptcy.

A handful of Madison Avenue condominiums located in a luxury high-rise building near the Empire State building have wound up in bankruptcy and will be sold in Chapter 11.

The residences include five penthouses, five non-penthouse residential units and two commercial units, according to developer Madison 33 Owner LLC, which filed Chapter 11 on Monday. Some of the units at 172 Madison Avenue aren’t fully finished…

…The business sought court protection months after an affiliate behind a former residence once dubbed “Le Penthouse” did the same to halt a foreclosure sale. The company is connected to real estate development firm Tessler Developments, according to court documents…

Madison Avenue Condos Near Empire State Building Hit Chapter 11 — Jonathan Randles | Bloomberg | August 27, 2024

Built Environment

...It’s a starkly different scene 10 miles to the east, in LA’s downtown core. Buildings are losing tenants and going into foreclosure, with the area’s biggest commercial landlord — an affiliate of Brookfield Corp. — defaulting on $2.2 billion of mortgages since last year. Tent camps dot the streets in the epicenter of the city’s homelessness crisis. Oceanwide Plaza, a graffiti-covered project abandoned by a Chinese developer, is headed for a bankruptcy auction in September.

Such disparities are unfolding across the US, exposing deep divides in the commercial real estate market and the recovery of cities after the pandemic. From LA to Chicago and Boston, aging business districts are contending with empty offices and a slow return of workers, while neighborhoods just miles or even blocks away are faring better — or even thriving...

...Office values in US central business districts have plunged 52% from their highs, according to MSCI Inc., with San Francisco, Manhattan and the core areas of Washington and Boston posting some of the biggest price declines among global metropolises since the pandemic.

Nationally, the drop in values from the peak is much smaller — 18% — in US markets classified as suburban, or areas that are outside the traditional core. And in high-demand neighborhoods such as Century City, investor dollars continue to flow…

A $557 Billion Drop in Office Values Eclipses a Revival of Cities — John Gittelsohn | Bloomberg | August 26, 2024

Bloomberg: Commercial Real Estate Prices 2014 - 2024

Residential conversions are all the rage.  Check out over 20 articles in our database!

In Seattle and other big cities, there’s a tremendous amount of interest in the concept, with some local and state governments offering tax breaks and other incentives. But only certain office buildings are strong candidates for conversion to residential living, and according to a new index, some cities have a lot more of them than others.

This index, called the Yardi Conversion Feasibility Index, shows Seattle is not among the standout markets for its share of office buildings that have a lot of potential for conversion.

In the index, buildings are given a score of up to 100 points based on about a dozen characteristics, such as the age, size and location of the building, walkability and transit access and architectural considerations. The best candidates for conversion score between 90 and 100 and are classified as Tier 1 buildings. Tier 2 buildings score between 75 to 89 points and are still considered strong conversion candidates. A score below 75 would classify a building as Tier 3, a poor candidate for conversion to residential use.

How feasible are office-to-apartment conversions in Seattle? — Gene Balk | The Seattle Times | August 31, 2024

Seattle Times: Office to Residential Conversion Potential in Major US Markets

New York, New York: Luxury office to residential conversion.

By late 2026, the Flatiron Building will be residential, with 60 luxury condos replacing the offices where Macmillan editors once pored over copy.

The new owners filed paperwork yesterday that sets the ball rolling on plans to convert the wedge-shaped 1902 landmark into apartments. The Commercial Observer broke news of the plans, which won’t change what you’ll see from the sidewalk. The owners — a consortium made up of the last owner, GFP Real Estate; the Sorgente Group, which focuses on historic renovations; and the Brodsky Organization, which specializes in residential — aren’t planning to add an addition or demolish any of its lovely terra cotta, and the ground floor will still be retail, though that’s being cut down by 2,000 square feet.

The paperwork shows that the building could fit 100 apartments that are about 2,000 square feet each. But the developers are asking to build only 60, given the need to use a big chunk of space for new elevators, fire stairs, trash compactors, wider hallways, and other residential requirements…

The Flatiron Will Go Condo — Adriane Quinlan | Curbed | August 27, 2024

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Saratoga Springs, New York: An historic hotel in Saratoga Springs is celebrating the start of a new era. A ribbon cutting was held on Thursday for new luxury condominiums at the Adelphi Hotel.

Ribbon cutting held for new condominiums at Adelphi Hotel — Courtney Ward | ABC News 10 | August 22, 2024

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Victoria, Canada: Peregrine falcons and condominium towers are complimentary.

A nesting pair of peregrine falcons, along with a juvenile born this year, have been landing on the upper decks and rooftop of the Promontory residential tower in the Songhees…

Penthouse home awaits rare peregrine falcons in Victoria — Darron Kloster | Vancouver Sun | August 26, 2024

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Chandler, Arizona: A condominium for you and your car toys.

Another self-storage development designed for housing your valuable and collectible “toys” is coming online this fall.  Those toys come in the shape of luxury and classic cars, boats and RVs and can be stored at Toy Barn, which already has six existing Arizona locations. The company is preparing to open Chandler Airpark North in early October, marking the seventh location for Toy Barn around the Valley….

…“We are a luxury garage condominium community, kind of like a country club for car guys, in a way,” said Jason Phillips, co-owner and founder of Toy Barn. “So it’s a real estate ownership concept. It allows people to buy and invest in real estate to serve a need versus renting a locker in a traditional storage facility.

“Since they own the units, they’re free to customize them on the inside however they fit. … There’s really nothing to stop them from the inside, except their own imagination.”

Luxury vehicle condominium Toy Barn continues expansion in Phoenix metro — Ron Davis | Phoenix Business Journal via KTAR | August 31, 2024

Condo Connection's financial coverage is indexed to our Dollar$ and $ense page dedicated to all things CIC finance.

“The time has come for policy to adjust,” Mr. Powell said during the Kansas City Fed’s annual conference at Jackson Hole in Wyoming. “The direction of travel is clear, and the timing and pace of rate cuts will depend on incoming data, the evolving outlook and the balance of risks.”

He then added: “We will do everything we can to support a strong labor market as we make further progress toward price stability.”...

Stocks Rise as Fed Chair Powell Signals Rate Cuts in Jackson Hole Speech — Jeanna Smialek | The New York Times | August 23, 2024

Cashing In

Landlords for offices, apartment complexes and other commercial real estate have $1.5 trillion of debt due by the end of next year, and about a quarter of that borrowing could be hard to refinance, according to Jones Lang LaSalle Inc.

The value of buildings has broadly dropped after higher interest rates boosted funding costs for property owners. Those lower valuations make it harder for landlords to borrow as much, forcing many property owners to raise equity capital to secure new debt or extend their existing facilities.

Apartment buildings, which make up about 40% of the looming maturities, are at the center of the refinancing wave, the broker says. Many US owners of the assets known as multifamily bought their properties using three-year floating rate loans during the easy money era. Interest rate increases since then have eaten up much of their rental income, making it a challenge to secure additional equity.

Rising insurance costs and falling values have added to the pain, leaving about $95 billion of the US properties in distress or at risk of becoming so, according to data compiled by MSCI Real Assets…

Landlords Face a $1.5 Trillion Commercial Real Estate Maturity Wall — Neil Callanan and Scott Carpenter | Bloomberg | August 31, 2024

Are you fascinated by case law?  Maybe you should be?

Discover our Case Law page!

Case Law Page

Nine people were injured. Nearly two dozen units were destroyed. Fifty families remain displaced.  

That's the reality at The North Hammond Condominiums in College Hill after an overnight fire broke out at the building in February 2023.


Sixteen months later, a Hamilton County judge heard the first of several testimonies from owners who are suing the condo board.  The complaints scrutinize the board's response to the fire claiming it has provided limited details to justify repair plans and information on how they'll be funded…


VIDEO: Testimony begins in College Hill condo lawsuit; owners say board can't force them out — Valerie Lyons | WCPO 9 | August 28, 2024


VIDEO: San Francisco's Millennium Tower owners could face $10k fine for open windows — NBC Bay Area | August 16, 2024

Window safety and drain backups are ongoing concerns in San Francisco’s Millennium Tower condominium.

…Henderson officials are threatening to shut off water services at the complex, an action that would force residents to vacate their homes indefinitely, unless a broken water system is fixed within two weeks, according to the letter.

The homeowners association — which is responsible for maintaining the private water distribution system of the complex near Sunset and Pabco roads — told officials that it can’t cover the repair costs, according to the letter.

“I just bought this house, and none of this was disclosed to me,” Rick Martinez said. “The letter is the first we’ve heard of it.”

The city told residents that the broken water system poses an “imminent hazard to the health, safety, and welfare of the public.” Shutting down the water would mean that the fire hydrants also wouldn’t function….

City threatens water shutoff to Henderson complex if HOA doesn’t make fixes

— Richardo Torres-Cortez and Annie Vong | Las Vegas Review-Journal | August 27, 2024


QUESTION: Our HOA sent out a letter on July 1 asking for payment on an assessment for more than $12,000, to be paid in full within 30 days…  Is there no recourse or protections for homeowners who cannot afford to cough up $10k+ with this outrageous lack of notice? Does the law not allow for payments towards large assessments? 

ANSWER: None of the relevant Acts discuss special assessments in any detail. Generally speaking, it is up to your governing documents to establish the board’s right to pass a special assessment, and any restrictions that may exist…

Residents shocked by HOA roof bill — pay $12,000 by end of month — Ryan Poliakoff | Palm Beach Post | August 25, 2024


The North Carolina Court of Appeals recently released two cases that raise the question of whether a covenant amendment containing rental restrictions may be adopted by a condominium association or homeowners association.  

Both cases – Mileview LLC, et al. v. The Reserve II at Sugar Mountain Condominium Owners Association (February 2024) and McDougald v. White Oak Plantation Homeowners Association, Inc. (August 2024) – are unpublished decisions, meaning they lack precedential value in future cases.  Despite the fact these cases are not binding precedents, they are insightful.  They show how the Court of Appeals views rental restriction amendments in certain contexts.

Both cases apply the Armstrong v. Ledges Homeowners Association, Inc. standard that amendments must be reasonable.  Armstrong is a 2006 North Carolina Supreme Court case that established the lens by which future amendments must be considered by a court.  The two recent Court of Appeals cases mentioned above strike down rental restriction amendments as unreasonable by applying the "reasonableness test" under Armstrong…

Recent Case Law Does Not Doom All Rental Restriction Amendments — Ward and Smith for JD Supra | August 26, 2024


…In many subdivisions across the U.S., “you may have contractually agreed to give up some of your rights, one of which may be placing signage in your yard,” says Bruce Ailion of Re/Max Town & Country in Atlanta. “You could be fined if you violate that covenant.”...

…Paul Wood Bonilla of Lodi, CA, was recently told by his homeowners association to take down three Trump signs on his property. According to CBS News Sacramento, the HOA claimed that Bonilla’s signs exceeded maximum size limits set by the Davis-Stirling Act…

…After Birmingham, MI, resident Nikki Sapiro Vinckier planted signs in her yard promoting Harris for president, she received a critical yet anonymous note from a neighbor. Vinckier responded by plastering her entire yard in signs—in pink, no less, to promote reproductive rights—telling the Detroit Free Press, “my goal is to start a conversation” and “stay lighthearted.”...

Why Planting Political Signs or Flags on Your Property Could Backfire… — Julie Taylor | Realtor.com | August 30, 2024


VIDEO: Lodi homeowner removes 2 of 3 Trump signs after HOA flags violation — CBS News Sacramento | August 19, 2024

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