Florida marks the two-year anniversary of the Champlain Towers South condominium collapse in Surfside tomorrow. Recertification laws passed after the tragedy could leave many condo owners with a rude awakening.
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Surfside - July 2, 2021: Debris remains at Champlain Towers Surfside Condominium after collapse. |
Further maintenance
Prior to the disaster, Dade and Broward were the lone
Florida counties where buildings more than 40 years old and
of 100,000 or more square feet were required to be
recertified. The mandate is now stricter, says Greg
Main-Baillie, Boca Raton, Fla.-based executive managing
director of Colliers.
Any building within three miles of a caustic environment and
more than 25 years old must have a Phase I milestone
inspection.
“You have a significant number of buildings through the
Tri-County area and really through the state that are now
mandated to maintain their structures,” he adds.
“To think any building more than 25 years old is not going
to require maintenance – like painting and waterproofing —
is a mistake. It’s highly likely a building inspector will
find a need for further maintenance. It’s true even of newer
buildings. If you’ve had the pleasure of walking down
Biscayne Boulevard (in Miami), you can look up and see signs
of deterioration on even buildings that are under 20 years
old.
“We’re talking about deterioration in structural systems.
The mandate is really something that was needed to raise the
minimal benchmark of maintenance, because it wasn’t being
done by the boards and condominium associations.”
Life savings
Many of those owning condominiums in older oceanfront
condominiums possess generational wealth. But not all do.
Main-Baillie reports he has learned owners of 1970s-vintage
$400,000 to $450,000 two-bedroom, two-bath condos could soon
be hit with $125,000 to $150,000 special assessments.
Many will not be able to afford them.
“And that only gets them to the level of a functional
competitive set,” he adds. “Once the building has spent that
money, the HOA fees are still going to double going forward.
There are serious implications of this. Even if boards are
telling condo owners they are fully funded, what is their
definition of fully funded? Does their definition meet the
state’s new requirement of fully funding the reserves to a
20-year useful life expectation?”
Another problem is that condominium associations elect new
board members on a yearly basis. “You have decisions being
made by boards that don’t understand their own environment,”
Main-Baillie says. “You can’t manage an asset when you’re
only managing for 12 months. You may need a paid
professional board member with overriding vote to push a
board in the right direction in compliance with mandates.”
Champlain Towers South owners argued about moving forward
with needed repairs and reconstruction for some time, he
adds. The building’s 40- to 50-year certification had been
delayed.
“It’s the responsibility of the unit owners especially with
a building that size to have the needed inspections and hire
the needed consultants,” Main-Baillie says.
The new mandate is good news for future buyers of Florida
condos. Once skeletons are rousted from buildings’ closets,
a financially safer environment will greet condo purchasers,
Main-Ballie says.
But first, a great many owners will have to endure the pain
of the next 36 months in which, he predicts, “You will see
major changes in the condo living environment in the state
of Florida, from both an economic and migratory standpoint.”