Feature Condo: ADMIRAL'S WALK
PROJECT FROM HELL - TURNS OUT OK
By Gord Wonnick, Treasurer of Halton Condominium Corporation #77
Admiral's Walk in Burlington is a 19 storey high rise condo comprised of 169 suites, 168 are owners' units and 1 is for the use of our superintendent. Apartments range from just under 1200 to 1572 sq. ft. and the building is 26 years old and has been very well maintained. The current Board of Directors is determined to keep the maintenance at a high standard and in step with our Reserve Fund Study.
We were certainly in step with the new condo act having had our reserve fund study completed and accepted a couple of years ago. This is where the fun begins.
As mentioned earlier our building is 26 years old and our reserve fund study called for us to do a garage roof waterproofing project in 2004. Actually it called for the project to be done in two phases with the second half to be completed in 2005. If it had not occurred to anyone before it certainly became very clear now that this is probably the only project that you cannot determine if, in fact, it is necessary to do repair work until you tear the surface apart. Once having torn it apart you might as well complete the project. The new condo act is quite clear and our Board of Directors really had no other choice but to proceed.
Once having decided to proceed we became quite optimistic that our Reserve Fund position might allow us to do the project in one year and consequently maybe save us some money. We began by interviewing some engineers and then hiring a firm to protect our interests. This type of project, in our opinion, would be a disaster without professional help. In addition, our Board had decided that to do this type of project and simply just put back trees and grass would an injustice to our owners. We felt that we should attempt to improve curb appeal consequently giving our ownership something tangible for their money. Also, the building code required that some changes were necessary, i.e. handicap ramp and widening of our circular drive to better accommodate fire trucks and other emergency vehicles.
Our engineers then went to work and prepared a bid package which was sent to five different restoration companies soliciting their bids to do the project. The bid package called for a two-phase project with about two thirds being phase one and the rest phase two. In addition, because we still felt that maybe we could do it all in one year it asked the bidders to specify what credits would be available if we did it all in 2004.
When the bids came in it became very clear in a big hurry that any credit to be had if we did it in one year would not be available to us because we couldn't afford to do it all at once. The five bids were pretty close in value which at least gave us comfort that all bidders viewed the project from the same hymnal but the amount left us speechless for some minutes. The bids came in at more than $500,000. over what the engineering firm had estimated in our Reserve Fund Study. This only goes to prove that when engineers do the study it is a guess (perhaps educated guess) and not much more when it comes to the cost of doing the work.
We were able to justify less than $100,000. of the variance because the reserve fund study called for us to do both exterior lights and irrigation systems in a couple of years, which of course was not a brilliant plan because we would be tearing everything apart now so it was logical to do those items at the same time. To try and understand the significant variance our President and I met with the engineer that did our study to see if he had any information that made sense. The result of our meeting was him saying "too bad, but you will have to make up the difference, most likely by assessment." Needless to say we were not impressed.
Anyway let's get on with getting this job done. We met with the successful bidder and determined the time lines so we could begin our planning. Once having done that we had to address our parking situation because much of our Parking level one would need to remain empty for the first part of the project. We are fortunate in that we have approximately 70 visitor parking spaces on that level. It was decided that we would use a lottery system to determine who would remain and who would have to park at a shopping mail a block away where we could rent some spots. The final result after much work and planning was that we rented 15 spots from the shopping center for 2 months, 9 spots would be for our two car owners for their second car and 6 would be for overnight visitors. Every one of our owners had at least one car on site. As luck would have it our two car owners were able to bring back their second cars several weeks early.
Just to make our life a little more interesting our back-up generator which was supposed to be good for another 15 years or so gives up the ghost during a full load test, another $75,000. leaves the reserve fund.
Work begins and of course we are sitting on pins and needles not knowing what to expect once the overburden has been removed because a portion of our bid is subject to how much delamination is found. We are very lucky that very little is found so we avoid any extra cost, as a matter of fact we get a small credit. Our restoration company have done a wonderful job of moving things along and keeping the site as tidy as possible. A significant factor has been that they provided an onsite superintendent who really knows what he is doing.
There is still one major hurdle and that is we have an upcoming Annual General Meeting wherein our owners will hear about our financial dilemma. Before the meeting is held we have already decided to ask another engineering firm to do a new reserve fund study, which the Condo Act allows when you are doing a major project. Our objective is to see if we can't smooth out some of the future requirements and thereby put less pressure on finances. In no way do we want to compromise keeping up with our maintenance and being in compliance with the act.
We present our situation to the owners and discuss with them the options as we, the Board, sees them. The options are to do an assessment which we certainly did not want to do and which would be a burden to the many single seniors that happen to live in our building or we could perhaps float a loan but that would require a change in our rules which prohibit us from borrowing more than $50,000. or we could increase our Condo Fees. We advised them that we would be having a new reserve fund study and it would not be possible to make a decision on what route we should take until after we received the study. As treasurer I suggested to them that an assessment if required would be between $3-4,000. and our fee increase could be as high as $50. per month if we were stuck with the original study. They were also told that we felt confident that the new reserve study might smooth things out and make it easier, as an example the existing study called for the Building Envelope to be done in a few years for $694,000. all in one year which logic dictates this would be at least 2 and maybe even a 3 phase project.
Well, as I write this article we are now at the tail end of phase one, nice new grass, much improved lighting some nice new landscaping which makes us all feel much better when we can see that our money bought us something.
Oh I almost forgot the real good news. Our new Reserve Fund Study is in and as we suspected there were some smoothing opportunities and our reserve contribution will need to increase by 7% per year for the next 7 years. What does this mean? Well because we have been operating at a small surplus our condo fee for 2005 is expected to jump only $11. per month. Not bad when you hear about all the horror stories as it pertains to reserve funds, particularly on fairly new buildings.
The moral of this story is when at first you get really bad news don't panic. Put your heads together, plan your approach and hire people that know what they are doing.
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Last Updated by Steve Warner on May 18, 2005
Last Updated by Steve Warner on May 18, 2005