HAWTHORNE PLACE
CONDOMINIUM ASSOCIATION
August 7, 2007
Dear Owner,
As you are aware, the Critical Façade exam required to be performed every four years by the City of Chicago was concluded in late May by the architectural/engineering firm, KGH, and contractor Riggio Boron. At that time, they found instances of concrete deterioration on both the roof and the west shear wall. Steps were taken as a “make safe” measure to remove or secure loose concrete until permanent repairs could be made. Further, KGH believes that making repairs to the concrete parapet on the roof will bring to an end to the window leaks many units are experiencing.
KGH was retained as the project manager for the repair portion of the project. They put together a scope of work and had five construction firms bid on the job. The low bidder is a reputable company called Berglund Construction. Their bid to complete the concrete repairs is $543,088.00. Any window leaks that are not resolved by the concrete repairs will be addressed separately; the cost estimated to be between $75,000-$200,000.
Per Section 18 (a) (8) (iv) of the Illinois Condominium Property Act:
“[S]eparate assessments for expenditures relating to emergencies or mandated by law may be adopted by the board of managers without being subject to unit owner approval...As used herein, "emergency" means an immediate danger to the structural integrity of the common elements or to the life, health, safety or property of the unit owners…”
The potential for falling concrete and water infiltration due to leaking windows gives the Board authority to deem these repairs an emergency. Work will proceed with KGH and Berglund Construction immediately.
When the 2007 budget was passed in December 2006, the Board set aside $100,000 for the Critical Façade exam and subsequent repairs, which has proven to be insufficient. To date, $55,042.70 has been billed for the project. All subsequent bills will be paid first out of the remainder of the $100,000 set aside for that purpose.
On June 30, 2007 the Association had $306,770.88 in the condominium reserve account. The Board is proposing a special assessment for $700,000 to cover the concrete repairs. The money left in the reserve account will be used in the event that additional funds are needed for window repairs.
The Board is also proposing another special assessment in the amount of $700,000 for the modernization of all three elevators. They are almost 40 years old and are nearing the end of their life expectancy. Elevator modernization will start in conjunction with the façade project and the special assessments are being proposed in tandem.
Owners will be given the option to pay the special assessments in one lump sum, or financing payments monthly over the next five years. Owners may also wish to secure their own financing for the special assessment through a home equity loan. Doing so will enable you to write off the interest paid on your tax return. Financing the loan monthly through the Association may or may not be a tax write off—please consult with your accountant.
A Board meeting is being called on Tuesday, August 21, 2007 at 6:30 p.m. for the purpose of discussing and possible adoption of the special assessment. The meeting will be held on the sun deck at 525 W. Hawthorne Place.
Attached is a spreadsheet that summarizes your obligation for the special assessment. The applicable interest rate will be determined after the Board finalizes negotiations with lenders. The current interest rate for this loan has been quoted at 6.75%.
Each unit owner will have the option to pay their share of the Special Assessment in full on or before October 5, 2007. If payment is not received in full, monthly special assessment charges will be billed to your assessment account beginning November 1, 2007.
If you have questions regarding either project or the proposed special assessment or resolutions (enclosed) please e-mail me. The Board and I will do our best to provide you with answers.
Sincerely,
Julianne Jackson
Property Manager, Sudler
Hawthorne Place Condo Association
525 W. Hawthorne Place
Chicago, IL 60657
direct (773) 525-8272
fax (773) 975-8377
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