Membership dispute heats up at condos
 

Article Courtesy of The Herald Tribune

By PAUL QUINLAN
Published March 23, 2006

 

VENICE -- For Ken Nicholson, the $163,000 he paid for his condominium at Jacaranda Trace, a South Venice retirement community, was plenty. A seasonal resident looking for a bargain, he couldn't justify paying nearly $2,500 in monthly dues for club membership.

Neither could many of his neighbors, about 30 percent in all. Although the club membership includes access to facilities, such as a pool, fitness center, lounge and dining room, there's no golf course and, at base rates, only 12 meals are included.

But now, Jacaranda Trace is considering changing the ownership rules to require that all future condo buyers purchase memberships, a move that opponents say is both illegal and influenced by the stakeholders in the retirement community, including Steve Roskamp and Greg Patterson, who took over in 2002 and now run it as the Roskamp and Patterson Management Co.

The plan has created a sharp divide between members and nonmembers. Opponents say it would slash the resale value of the condos, as prospective buyers will balk at having to pay thousands of dollars a month for club dues.

Dues currently range from $1,946 to $3,266 for single-occupancy units and $2,292 to $3,266 for double-occupancy.

"A lot of people wouldn't have bought in here if we knew this would happen," said Nicholson, who purchased his condo last year.

But members who support the move disagree, saying the requirement will foster more social interaction and enhance the overall retirement experience, improve the community and raise the value of units.

"I feel this amendment is necessary and will be to the benefit of all," said Charles Knowles, who sits on the condominium board of directors. "If they're not going to be a part of the total experience and utilize the services that are here, this is not where they should be living."

Patterson said that neither he nor Roskamp had any part in proposing the mandatory membership requirement, though he said he supported the idea, because it ensured that everyone could participate in the club's amenities and services.

"It's the trust and relationships that set us apart," said Patterson.

As a protection for those who fear values might drop, an agreement was drafted that obligated Jacaranda Trace Commercial to repurchase units that sit on the market for one year at 90 percent of the original purchase price.

Board members called the clause a guarantee against loss, while opponents said it robbed condo owners of their equity.

"In all the investments I've ever had, I've never had one ... where in 20 years from now, you're able to get 90 percent of your money back," said board member Bill Burgher. "The developers have done a heck of a job to ensure that you benefit."

But Dan Lobeck, attorney for the group of nonmembers, called it an obligation to "steal" back units.

Under the proposed arrangement, management could raise membership dues without fear of losing memberships, while significantly devaluing the condominiums, he said.

"If this passes it will make it very difficult for exit owners or their estates to sell their unit for anything close to what it would be worth," Lobeck said. "Who would buy into such a burdensome and one-sided deal?"

Lobeck said such a change should require approval by 100 percent of residents, rather than the 70 percent the condominium board is seeking. He accused Roskamp and Patterson of exerting undue influence over the board, which consists entirely of club members.

"This is an incredibly bad proposal for all unit owners, not just those who have chosen to become club members," said Lobeck. "Once the unit owners become hostage to mandatory club membership, the club has more incentive to change the terms of membership in a way that benefits the club and harms the owners."


 
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