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PatriciaM13 (Vermont)
Posts: 2
Posted:
Hello,
I was wondering if anyone has had the experience of owning a condo unit within a complex that has multiple buildings and one of the buildings was knocked down and insurance will cover most of the costs of replacing the building but each unit in replaced building will be approximately 200 square feet bigger. Also the new building will have a more efficient heating system...gas and the old (40 years) ones have electric. Other amenities in new building will be separate water/sewer meters, insulated windows, gas fireplaces. The new units in replaced building will most likely have a value of twice as much as older units. We are situated at a resort.
My questions are...

Does the percent interest in common areas change due the new foundation taking over about 2400 more square feet of common area and also that each unit will go from about 1000square feet to 1200 square fee. The reasoning for this expansion, we ere told, was due to code upgrades.

How would the association fairly divide a possible large upcoming assessment to cover money not received for rebuild from insurance among all unit owners. Would it be an equal division or based on percent ownership.

Since the older buildings looks shabby now for lack of capital and have a different exterior than new proposed building, would it be fair to have all pay for upgrade of all buildings.

Your thoughts would be appreciated
BobD4 (up north)
Posts: 1,002
Posted:
Quote:
Posted By PatriciaM13 on 02/28/2016 5:53 PM
. . . one of the buildings was knocked down and insurance will cover most of the costs of replacing the building but each unit in replaced building will be approximately 200 square feet bigger. . . My questions are...

Does the percent interest in common areas change due the new foundation taking over about 2400 more square feet of common area and also that each unit will go from about 1000square feet to 1200 square fee. The reasoning for this expansion, we ere told, was due to code upgrades.

How would the association fairly divide a possible large upcoming assessment to cover money not received for rebuild from insurance among all unit owners. Would it be an equal division or based on percent ownership.

Since the older buildings looks shabby now for lack of capital and have a different exterior than new proposed building, would it be fair to have all pay for upgrade of all buildings ( ? ).

PatriciaM13 Vt

Presuming all the buildings you describe are condominiums subject to the same Declaration, check out Vermont's Title 27: Property ; Chapter 15: Condominium Ownership Act http://legislature.vermont.gov/statutes/chapter/27/015 . . . ( If instead Title 27a Title 27A: Uniform Common Interest Ownership Act (1994)a similar Declaration based formula is shown in subsection 3-115 (b))

A Declaration contained formula is indicated to determine the allocation of common expenses, not some details of insurable loss.

A re-build that would enlarge the particular building's floor plate / correspondingly shrink the common element, would seem to require a Declaration amendment ( Building Code compliancy or not )for shrinking the common element. So also would any alteration for any reason, of the Declaration-provided common expense breakdown.

Maybe the other issues are also there whenever someone improves a single unit or when end of life components - eg exterior cladding - have to be replaced under reserve funding. "Fairness" = ?

If insurance deductibles and/or supplementary contributions are required as a common expense, how could such be funded other than by unit by unit Declaration formula ?

If your corporation has a standard unit by-law, expect the enlarged units to require a corresponding change.

BobD4 (up north)
Posts: 1,002
Posted:
PatriciaM13VT : I neglected to specifically suggest your Condo statute's subsection/ subchapter 1310 Common profits & expenses
PatriciaM13 (Vermont)
Posts: 2
Posted:
Thank you BobD4 for info. I'll check out the VT gov site on how ownership is divided.
DouglasK1 (Florida)
Posts: 2,046
Posted:
Have you reviewed your CCRs to see what they say about how regular and special assessments are calculated? Assuming the define this, you would have to modify them following the requirements they define (often 2/3 of more of the owners assent) to change how the units are assessed.

Escaped former treasurer and director of a self managed association.
JohnC46 (South Carolina)
Posts: 14,265
Posted:
Patricia

There are several methods of computing assessments. They range from all are equal regardless of size or location (probably the most common) to variations based on size and/or location. Your Covenants will spell out the formula applicable to your association.

I expect it will be each unit pays the same.

JeffT2 (Iowa)
Posts: 880
Posted:
Your original declaration describes the old buildings and allocates ownership interests (and voting and assessments) based on those old buildings. Now that you have a different building, your declaration is no longer valid, and the legal basis for collecting assessments is also invalid.

I would strongly consider dividing into two separate condominium complexes.

Alternatively, create a master association and two sub-associations to handle the needs of the different buildings.

Until you do, you will always have legal and fairness questions in collecting and allocating money and for handling your different needs-- and threat of lawsuits.
NpS (Pennsylvania)
Posts: 4,216
Posted:
Quote:
Posted By JeffT2 on 03/01/2016 7:23 AM
Your original declaration describes the old buildings and allocates ownership interests (and voting and assessments) based on those old buildings. Now that you have a different building, your declaration is no longer valid, and the legal basis for collecting assessments is also invalid.

Agree with first sentence. Not sure that declaration and legal basis for collecting are invalid though. Would say instead that the building changes justify an amendment to the declaration. If you can come to an agreement on what the cost-sharing intent was in the original declaration, you can try to apply that to the new arrangement. Going to be controversy no matter what you try to do.


Sikubali jukumu. Read all posts at your own risk.

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