It always comes down to money, doesn't it.

[missy]

I just saw on the news this morning that the collapse of the building in Fla was not something that should have come as a surprise.
The coop board and managing agent knew that millions of dollars of repairs were necessary and that each shareholder needed to spend from 80K to 333K to do those critical repairs. In fact most of the coop board quit in 2019 over this issue.


Does it always come down to money?
Is life expendable?
Does the almighty dollar mean more than lives?

In almost all instances I think sadly this is a fact.

The health insurance companies go by statistics in order to save money and instead of covering potentially live saving treatments they do a statistical cost analysis and human lives are not sacred over the expense to the insurance company. Same for screening tests. If it isn't cost effective it won't be covered. Even if it could potentially save your life. They look at the cold hard numbers and the bottom line is more important than saving lives.

This building should never have gotten to that point of disrepair. And people lost their lives. Parents lost children. Children lost parents. Grandparents dead. Friends dead. Loved ones dead. For what? To save money lives were gambled and lost.

I am heartsick and this world sucks big time.

Months Before Florida Condo Collapsed, Residents And The Board Sparred Over Repairs

A November 2020 presentation to residents of Champlain Towers South in Surfside, Fla., prepared them for the expensive repairs ahead and warned that "shouting at each other doesn't work!"

www.npr.org

What is the economic value of a human life?
Should cost be prioritized over living beings?
Is it idealistic to think that lives should come first?

We dealt with this issue during the pandemic too.
Closing the economy so to speak to save lives.
The government weighing lives to the cost of the economy.
People felt strongly both ways.
Some felt the cost of lives worth it to save the almighty dollar.
Others disagreed.

How can we pay for all we need to in order to put living beings first.


What are your thoughts?

 

[elizat]

A lot to unpack in the post. I will just comment on the issue of that building.

There are a lot of other articles out there that indicate that they got a lot of variances and departures from standard building code rules.

There is a very interesting article that I will try to find again that goes back to the building of these towers and how basically they let them sit for a while, after the first one or two were completed and then finished up the rest, but in the interim the building code had changed to not allow first floor units due to flooding with hurricanes. Well, they were still able to do exactly the format that was originally permitted, even though the code had changed. Even though having occupied units on the first floor with a hurricane and waves, puts those units and the people that live in them in peril. I understand that waves can go high, and that even if you were on the second of the third floor you may not necessarily be safe, but no dwellings on the first floor was a reasonable amendment to the building code for a multi-store unit building like this on the coast.

I think with buildings like that, it's difficult, because when they wait to do maintenance, it becomes so expensive that people can't afford it.

I don't think that there are many people that are able to afford that type of special assessment and even when you make it a monthly payment, it's cost prohibitive for many people.

The fact that there was also a management company involved is pretty shameful to me. I could understand this situation more if it was just a homeowner led board, but the fact that there was a professional management company involved is appalling.

I was reading about the assessments on the building and some of the homeowners had made their elections on monthly versus one-time payment. There was a huge amount allocated to just improvement as far as betterments and updating, and the structural was just kind of thrown in there. Why there was no focus on making the building safe, when they knew it had severe structural problems is beyond me. My guess is if you go back and look at the records even further, there will be more information that comes out that even before 2019 they knew they had major problems.

It appears that this was largely entirely avoidable. I say largely because we don't know what would have happened if they would have done the work that was needed, or if once they started the work, that would have made the situation escalate even quicker.

Instead, the management company and board sat on it for years, when they could have prevented this by and large. It's appalling.

 

[doberman]

The world isn't run by countries anymore, or even governments. It's run by corporations to profit the 2%. Corporations have no souls.

 

[Arcadian]

This and many more are reasons why I did not and would not consider a condo in a highrise in FL @missy Its also the reason why I did not want to live anywhere near a HOA either. Developers down here do a lot of isht and dirt to make sure they don't have to fix things. There's several buildings in Miami and up and down the coast even now in various states of disrepair, and these things are not getting fixed.

 

[elizat]

Engineer Probing Champlain Towers Debacle Eyes Possibility of Three Successive Collapses

Investigators probing the trigger of the progressive collapse of a section of the Florida residential condominium are preparing a computer model of the unstable 12-story tower remains to advise about vacating rescuers in the event of a hurricane.

www.enr.com

I think that's a fairly interesting article from an engineering standpoint.

@Arcadian fellow Floridian. I also would never purchase a high-rise condo here.

https://www.miamiherald.com/news/local/community/miami-dade/miami-beach/article252467273.html

Interesting on the building of the towers.

 

[Jambalaya]

I'm supposed to be working, so just quickly - I think a big part of the problem was the sheer expense of the repairs, in that the board found it difficult to get financing, and then there were the inevitable complaints. I'm not surprised that most of the board resigned over it in 2019.

However, two things puzzle me: For such an enormous amount, the payment schedule should have been a lot longer than 15 years. I'm thinking 30 or 35. I know that this means condos would be sold with this financial obligation intact, but I have seen this before. It usually means a discount on the condo.

Secondly, I don't understand how the board could not press ahead with the plan regardless of complaints. I live in a condo and I know that as an owner, you HAVE to pay for the assessed repairs, otherwise you face foreclosure. There's no room for complaints, otherwise nothing would ever get done - like here.

Maybe the board tried to get better terms and couldn't. Maybe they didn't try hard enough. Who knows? But I think this situation was more about the amount for repairs being SO much plus a short payment plan, rather than the board simply being negligent.

 

[MissGotRocks]

Agree with what many others have said but will just add that the board, the tenants, the public - no one could have foreseen this tragedy in its entirety. Would most people trade their lives for dollars in that situation? No of course not. However, they could not have known that putting off or balking about the repairs would end in the collapse of the building. Moving forward, I think lots of people and associations will take a much harder look at structural evaluations of their buildings. Age, salt water, hurricanes, etc. all can obviously have a detrimental effect on these high rise structures. I hope we will never see another situation such as this. Condo associations have the right to levy repair bills on owners through their bylaws. It even happened to my in-laws in a time share. I would never want to leave myself vulnerable to that kind of expense so those types of living arrangements would not be for me. It is for the good of all but a 30k bill for repairs would not of course be easy for many of the tenants. Who is to say that the work done would have even prevented what happened? I am thinking the problem probably stemmed much further down than even the waterproofing. Time will tell and my sorrow for those people that lost their lives and the families left behind is immeasurable.

 

[MrsBlue]

People knew about the damage and assessments and bought in 2021 anyway. I can't wrap my head around it.

Champlain Towers South Apartments Were Hot Commodities Before Collapse

Before Champlain Towers South in Surfside, Fla., became the site of a horrific, deadly accident, its condos were in high demand.

commercialobserver.com

 

[MissGotRocks]

People knew about the damage and assessments and bought in 2021 anyway. I can't wrap my head around it.

Champlain Towers South Apartments Were Hot Commodities Before Collapse

Before Champlain Towers South in Surfside, Fla., became the site of a horrific, deadly accident, its condos were in high demand.

commercialobserver.com

I am guessing they assumed that problems would be taken care of and had not a thought in their head that what happened would happen. Otherwise, they would have all run away from any purchase there. I can only assume now that sales will fall in other neighboring buildings until time has passed. People will eventually rationalize that it was a one off occurrence and will probably never happen again. Their desire for an oceanfront condo will outweigh their common sense.

I remember so well after 911 hearing that people were told the situation was under control and to go back upstairs to their offices. You think in horror how could they have gone back up? Simply because they never thought the unthinkable would happen. I think it falls along those same lines.

 

[missy]

This and many more are reasons why I did not and would not consider a condo in a highrise in FL @missy Its also the reason why I did not want to live anywhere near a HOA either. Developers down here do a lot of isht and dirt to make sure they don't have to fix things. There's several buildings in Miami and up and down the coast even now in various states of disrepair, and these things are not getting fixed.

It is a tragedy on many levels. I feel for all the families involved.

In New York I believe it much less likely something like this could happen. There are local laws (10 and 11 IIRC) that require inspection of buildings every few years making sure they are safe. We are in a co-op and we have no choice but to have these inspections every few years and do the necessary repairs. That way it doesn't get out of hand.

IMO the fact that it got so out of control means someone wasn't doing their job. It never should have reached that 15 million dollar repair level. It is to be expected to have assessments when one lives in/owns an apartment in a building. It is unrealistic to think repairs will not have to be done on a regular basis.

I live in a condo and I know that as an owner, you HAVE to pay for the assessed repairs, otherwise you face foreclosure. There's no room for complaints, otherwise nothing would ever get done - like here.

Exactly. I mean people do complain but too bad. When you own an apartment (just like if you own a house) things have to be taken care of continuously. To not realize this is to be naive.

 

[Jambalaya]

Elizat made a good point - that many of the repairs were of a cosmetic nature. Why couldn't they have assessed for the really serious stuff, like the leaking pool and degrading concrete, and failed pool membrane, alone back in 2018? I'm sure that the repairs would still have been expensive, but looking at the line items, the cost would have been cut dramatically if the nice-to-haves had been put off and the structural issues addressed.

The board probably never dreamed that the place could just collapse, though.

 

[missy]

Elizat made a good point - that many of the repairs were of a cosmetic nature. Why couldn't they have assessed for the really serious stuff, like the leaking pool and degrading concrete, and failed pool membrane, alone back in 2018? I'm sure that the repairs would still have been expensive, but looking at the line items, the cost would have been cut dramatically if the nice-to-haves had been put off and the structural issues addressed.

The board probably never dreamed that the place could just collapse, though.

That was their main job IMO. I was on my co-op board for over 11 years and Greg has been Co-op board president now for over a decade. Our main job is to keep everyone safe. To keep our investment safe yes but most importantly to keep our shareholders safe. They should have known. IMO that was their job.

It is so upsetting. This was preventable. There was failure at more than one level for this to happen. This should not have happened. I hope going forward Florida changes its laws and does a better job at protecting their people. Laws have to be in place to ensure people do the right thing. Time and time again it has been proven that left to their own devices people ultimately disappoint and fail and put the almighty dollar first. Rules need to be in place to ensure safety.

 

[Jambalaya]

IMO the fact that it got so out of control means someone wasn't doing their job. It never should have reached that 15 million dollar repair level.

Seriously. No kidding.

Missy, you own an apt in a co-op and also a house. Which has been the most expense, maintenance-wise?

 

[elizat]

That was their main job IMO. I was on my co-op board for over 11 years and Greg has been Co-op board president now for over a decade. Our main job is to keep everyone safe. To keep our investment safe yes but most importantly to keep our shareholders safe. They should have known. IMO that was their job.

It is so upsetting. This was preventable. There was failure at more than one level for this to happen. This should not have happened. I hope going forward Florida changes its laws and does a better job at protecting their people. Laws have to be in place to ensure people do the right thing. Time and time again it has been proven that left to their own devices people ultimately disappoint and fail and put the almighty dollar first. Rules need to be in place to ensure safety.

Currently, buildings like this only require a 40 year reinspection. The standards for construction changed a ton after the 80's and even into the 90's. I hope they make recertification much more frequently. 40 years is too long in a coastal area with humidity, salt, flooding and hurricanes.

 

[Jambalaya]

It is so upsetting. This was preventable. There was failure at more than one level for this to happen. This should not have happened. I hope going forward Florida changes its laws and does a better job at protecting their people. Laws have to be in place to ensure people do the right thing. Time and time again it has been proven that left to their own devices people ultimately disappoint and fail and put the almighty dollar first. Rules need to be in place to ensure safety.

I could not agree more with this. Could have written it myself. Too many people will NOT do the right thing unless forced by law.

 

[Jambalaya]

Currently, buildings like this only require a 40 year reinspection. The standards for construction changed a ton after the 80's and even into the 90's. I hope they make recertification much more frequently. 40 years is too long in a coastal area with humidity, salt, flooding and hurricanes.

Especially with rising seas. I think climate change alone dictates more frequent inspections.

 

[missy]

Seriously. No kidding.

Missy, you own an apt in a co-op and also a house. Which has been the most expense, maintenance-wise?

Co-op in NYC. Hands down. And that’s even with our beach house property taxes costing a small fortune and also us needing to redo our backyard after hurricane Sandy destroyed it.

 

[elizat]

Co-op in NYC. Hands down. And that’s even with our beach house property taxes costing a small fortune and also us needing to redo our backyard after hurricane Sandy destroyed it.

Not to derail this, but my brother is going to be buying a coop in Washington Heights. He's been assured the expenses are very set. Worried a bit. He works in education and is young.

 

[Jambalaya]

That's very interesting, @missy ! It makes me wonder if owning a well-built new-ish house would be better.

ETA: Better for me, I mean.

 

[missy]

Not to derail this, but my brother is going to be buying a coop in Washington Heights. He's been assured the expenses are very set. Worried a bit. He works in education and is young.

I don’t see how anyone can promise anything with regards to expenses down the line. I’m sure he’s checked the financials of the building though and he’s making a good investment. Good luck to him Eliza and congratulations. It’s very exciting buying a home especially when one is young and has much to look forward to.

 

[missy]

That's very interesting! It makes me wonder if owning a well-built new-ish house would be better.

It depends on the area. We happen to live in two of the most expensive states in the USA.

 

[rocks]

That was their main job IMO. I was on my co-op board for over 11 years and Greg has been Co-op board president now for over a decade. Our main job is to keep everyone safe. To keep our investment safe yes but most importantly to keep our shareholders safe. They should have known. IMO that was their job.

It is so upsetting. This was preventable. There was failure at more than one level for this to happen. This should not have happened. I hope going forward Florida changes its laws and does a better job at protecting their people. Laws have to be in place to ensure people do the right thing. Time and time again it has been proven that left to their own devices people ultimately disappoint and fail and put the almighty dollar first. Rules need to be in place to ensure safety.

Missy, what you say is largely true in nyc. I’ve been on our board for as long as I can remember. Our job is to act in a fiduciary capacity; we need to safeguard our shareholders and make financially responsible decisions. We have a massive reserve. We spend huge amounts of money on things you can’t see. The shareholders focus on amenities….until there is a problem. The laws you site are are the result of deadly disasters that have caused unnecessary death. The inspections for our building used to cost $10k to $20k. This year the inspection will cost $180k to 190k. We have never had a substantive problem; we are always way ahead on the repairs and we are not the only building whose management is proactive. (My bet….yours is as well). All that said, NYC didn’t need to make the law more severe. There are going to be unintended consequences of the new inspection requirements. Middle class condo and coop buildings in the boros do not have the money to do the inspections. The city needs to enforce the laws already on the books and not allow the scofflaw landlords and developers to perpetually avoid complying with the law, and face consequences for their lack of compliance.

 

[rocks]

Not to derail this, but my brother is going to be buying a coop in Washington Heights. He's been assured the expenses are very set. Worried a bit. He works in education and is young.

Expenses are never set unless he is buying into a subsidized coop. He needs to dig into the financials. How much of a reserve fund does the building have? Look at the buildings history of assessment, determine what capital projects have been planned and completed (roof, elevators, including mandatory safety upgrades, local law 11, green benchmarking and necessary upgrades (big fines for non compliance), hvac, mandatory conversion to natural gas, windows….the list is endless. When does the underlying mortgage get refinanced? Does it amortize?

All that said, very exciting!

 

[doberman]

That was their main job IMO. I was on my co-op board for over 11 years and Greg has been Co-op board president now for over a decade. Our main job is to keep everyone safe. To keep our investment safe yes but most importantly to keep our shareholders safe. They should have known. IMO that was their job.

It is so upsetting. This was preventable. There was failure at more than one level for this to happen. This should not have happened. I hope going forward Florida changes its laws and does a better job at protecting their people. Laws have to be in place to ensure people do the right thing. Time and time again it has been proven that left to their own devices people ultimately disappoint and fail and put the almighty dollar first. Rules need to be in place to ensure safety.

There is no way this won't happen again. The unpaid bills of the 80s are coming die. Florida is way too corrupt to instill rules. (Rules? Those are for other people, not shady developers looking to do a deal) Florida is way too unconcerned about the despoiling of its natural resources. There's a sick attitude there. I read the story of how this place was built and the sleazebags who built it. It will curl your hair.

 

[Bron357]

Building collapses in countries where building regulations are not enforced happen.
Here in Sydney, Australia we have strong building regulations however recently (past 2 years) we have had two instances where structural cracking appeared, not that long after building, and both buildings were evacuated and then deemed “unlivable due to risk” without loss of life thankfully.
It comes back to $$$ of course. The developers cut costs whereever they could to maximise their profit.
The costs, now the responsibility of the owners and restitution costs run into the millions. So now an owner of an $800,000 apartment (likely with a $500,000 plus mortgage) is required to put up another $500,000 or so to make their $800,000 apartment safe, livable and sale able.
So as it stands they have $500,000 worth of mortgage repayments to continue against an asset with no value while having to pay to live elsewhere. The developers have conveniently since gone into liquidation/ declared bankrupt so pursuing the developers is pointless, even if the apartment owners had the time, energy and money to pursue through the courts.
And that’s the root cause with the Miami building.
No one thought for a single second that the building would actually collapse but I’m sure every apartment owner balked at the news that they had to put up another $200,000 or so each to fund repairs.
If the people who lived in that apartment tower were given the choice of paying $200,000 to stay alive, everyone would have paid instantly without complaint BUT that wasn’t how people saw the situation.
Everyone always wants the issue to be someone else’s responsibility or fault if there’s $$$$ involved.
Human nature.
very very sad for those poor families who only acted as you or I would have had in the situation ie not thinking that the building would literally collapse and kill them.

 

[wildcat03]

Not to derail this, but my brother is going to be buying a coop in Washington Heights. He's been assured the expenses are very set. Worried a bit. He works in education and is young.

FWIW, I owned a co-op just outside of NYC for a while. The expenses were very predictable BUT the co-op had excellent reserves and a solid maintenance crew - they didn't seem to have to hire external people for much at all. They didn't spend on silly stuff (the carpets in the hallways were worn, but shampooed often), etc. So it definitely wasn't the fanciest, but it was safe and well cared for.