Parkchester South Condominiums, the largest of the two separate condominiums that make up Parkchester—with 8,286 of the more than 12,000 units in the complex— is undergoing major capital improvements yet again. But this time rather than taking loans out, they will instead institute a temporary 15.19% common charge hike across the board for all units in the development to pay for these improvements.
Needless to say, this isn’t sitting well with residents and home owners at one of the largest condo developments in the world. Residents have been organizing against this fee and have a rally scheduled for this coming Wednesday, February 10th, at 4pm at 2000 E Tremont Avenue.
Back in 2000, Parkchester South Condominiums financed a $130 million loan which retrofitted the 8,000 plus unit with new windows, electrical wiring, and plumbing. Before this major capital improvement took place, it was reported that there were reports of over 60 leaks a day in the development.
This wasn’t an easy deal which even ended up in Bronx Supreme Court with residents and owners challenging the condominium board which imposed a $35 increase on common charges to repay the loan. Minor exceptions were made for people with disabilities and seniors if they qualified.
Now, rather than taking out a loan, the condo board has decided to implement an across the board 15.19% increase on common charges to cover the capital improvements it says it must complete by the end of 2017 as per NYC regulations.
According to a memo issued by board:
“Why are these repairs necessary? Why now?
The wide-spread water infiltration and the discovery of roof slab damage are matters that must be dealt with immediately to avoid the possibility of a ceiling collapse, which could potentially injure someone, displace neighbors, and leave units in disrepair, rendering them unsaleable. When it comes to issues of safety, the Board must act responsibly and we immediately put a plan in place to protect our homes and investments in Parkchester.
It helps to get to the origin of how we found the need for repairs. Under new management installed by the Board of Managers, building engineer consultants conducted investigations to address 300 leaks located in 92 different buildings. These inspections revealed damage caused by years of deterioration due to past water infiltration. Structural engineers determined that, although prior roof repairs may have addressed and stopped leaks, water had penetrated the roof slab and continued to cause further deterioration. This deterioration was not always visible either from above when roofs were removed and replaced, or even in some cases in apartments. This latent condition was likely further aggravated by the construction practices and materials commonly used in the 1940’s, but not acceptable today. We are also obligated to comply with NYC Department of Buildings Local Law 11 regulations with respect to regular inspections, maintenance and repairs to building facades. Those regulations require work in 17 buildings before the end of 2017.”
The board’s reasoning for the increase rather than taking out a loan as in the past was stated as:
“The Board only came to this decision after careful and considerate deliberation, understanding that this temporary increase will be difficult for many unit owners. Borrowing funds for these repairs would require approval of 66 2/3% of all unit owners. Having gone through that process for the renovation loan in 2000, the Board was conscious of the time and additional expense required to obtain that approval. In addition, the interest expense and other costs associated with such a loan would add to the cost for unit owners over the long term. For these reasons, it was ultimately decided that a temporary increase in common charges best meets our objective to complete the extensive repairs in as timely a manner as possible. Ultimately, spreading the temporary increase out over a two-year period reflects the most flexible and conservative way to raise the funds to get this critical work done quickly and effectively.”
PSC board stresses that the increase is only temporary and for 2018 they would revert to 2015 levels with some few minor tweaks based on the needs of the 2018 budget along with fuel, and other necessary expenditures taken into account when setting fees. They decided a common charge increase was the best route leading to greater savings overall and speeding up the process but at what cost?
The increases will average anywhere from the low $100.00’s to the $150.00’s or more a month based on the size of the apartment. No matter how you look at it, owners will be expected to shell out well over $1,000 extra a year until the end of 2017 when all of this work is scheduled to be completed all the while creating a burden on many owners.
There’s also the fact that many units are not owner occupied and will these landlords pass on this increase to the tenants?
Something worth mentioning is that NO ONE will be exempt from this increase, not the board, nor entities that own a large number of units.
Are you an owner at Parkchester South Condominiums? Are you a renter? We’d love to hear from you on what you think about this increase and capital improvements.