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AllumW (Florida)
Posts: 68
Posted:
Has anyone been successful with getting their developer to turn over the community early or have them appoint a homeowner to the board before turnover?

I currently live in a developer controlled HOA in FL. The community has 6 phases and phase 1 started in 2003. We still have phase 6 to go. But currently we're close to 90% for turnover. Our board has been a revolving door of developers since 2003. Homes in our community have been built by at least 4 different companies.

All communication with the board (developers) is run by the management company. We don't have contact information for the board other than their names.

The issues:

Amenity Center is deteriorating (wood rot, missing soffits, etc) and the management company has told the homeowners in Feb 2017 that they were seeking bids. A recent meeting with the management company in Sept 2017, they're still seeking bids.

Communication with the management company is incomplete/insufficient. Only half truths are being told which have left the relationship with the management company & homeowners to be tense to put it mildly. Many of our annual meetings have been screaming matches.

I'm trying to push for turnover by the board with scheduling a neighborhood meeting to inform the community (more than 700 homes). Also trying to get some committees formed.
GwenG (Florida)
Posts: 669
Posted:
From the sound of the condition of your amenities, I would not be too eager to acquire the poor Developer(s) product. It appears that your phases are a mish-mash of different builders and may not have coherent or compatible phases or a quality build. Rather, I believe your community should lay down a "go slow" plan, guided by a knowledgable "turnover" lawyer assisted by competent engineering evaluation of any infrastructure you will be adopting at turnover.

It would be in the Developer's best interest if you bum-rushed the turnover before those bids come in. There is a reason those bids never came in--they are probably more than the Developer wants to pay. YOU will end up paying those costs later if you let the Developer off the hook too early.

You do not want to assume responsibility for the financial burden of fixing the shoddy work and materials of a Developer or Developers.
SheliaH (Indiana)
Posts: 6,964
Posted:
I moved in an already established community and don't have direct experience with this subject, but you might want to check out the Community association institute (CAI) website, which has a number of education resources for HOA residents, boards and committees. There's also literature on what homeowners should look for when the community is turned over from the developer - there could be some useful tips for you and your neighbors to make some plans, as well as how to respond if the developer considers the lack of communication. Good luck!

If it is not right do not do it; if it is not true do not say it. Marcus Aurelius
JohnC46 (South Carolina)
Posts: 14,265
Posted:
Allum

Typically your docs will have a turnover time specified by date or amount of homes sold.

Gwen gave you some good advice. If issues exist the developer is responsible for, do not be so anxious to let them off the hook.
AllumW (Florida)
Posts: 68
Posted:
Thanks everyone. In Florida turnover is 90% of all phases. Phase 6 is at zero right now. We pay annual assessments and that's what is used to complete the repairs on the common areas, community events, etc. The developer contributes a certain amount since they have lots. Since we're so close to turnover, I'm concerned with them delaying repairs. I agree we probably shouldn't rush it. But we have no meetings/input on how our assessments are spent. And no resolution to issues we bring up. It's frustrating at this point.
DouglasK1 (Florida)
Posts: 2,046
Posted:
It can be frustrating, and that's why a lot of people here recommend not buying into a developer controlled association. Our developer was non-responsive to homeowners too, but luckily this is a small subdivision and was built out in a 2-3 years so it didn't go on too long. Ours didn't even hold annual meetings, our first was the turnover meeting.

Escaped former treasurer and director of a self managed association.
AllumW (Florida)
Posts: 68
Posted:
Now we know. This is our 3rd home and only 2nd in an HOA. We didn't realize that there was 2 additional sections that needed to be built out when we bought out home. We were told that one section was conservation land. We thought our section was the last.
JanetB2 (Colorado)
Posts: 4,219
Posted:
What do your CCR's state regarding period of Developer Control??? How many homes have been completed vs number of empty lots for each Phase??? Do you have proof when developer first was notified regarding not properly maintaining common area property???

There are pros and cons to taking over the HOA from the developer ... if there are maintenance items it could depend on the costs for the repairs vs size of HOA. .

AllumW (Florida)
Posts: 68
Posted:
Our CCRs state that the developer is in control until 100% is conveyed. But FL supersede that and it's 90%. We are at 87% total completion. However, the new phase hasn't be built. So we don't technically have the 90% in all phases.

I have a letter from the management company dated 02/2017 that state they are seeking bids to complete repairs in the amenity center for the wood rot.
GwenG (Florida)
Posts: 669
Posted:


Florida 720.307
(1) Members other than the developer are entitled to elect at least a majority of the members of the board of directors of the homeowners’ association when the earlier of the following events occurs:

(a) Three months after 90 percent of the parcels in all phases of the community that will ultimately be operated by the homeowners’ association have been conveyed to members;
(b) Such other percentage of the parcels has been conveyed to members, or such other date or event has occurred, as is set forth in the governing documents in order to comply with the requirements of any governmentally chartered entity with regard to the mortgage financing of parcels;

On first flush, I might argue that your governing documents say 100% and that b) applies in your situation except that b) give you a choice of "governing documents" OR a "triggering event aka buildout of infrastructure required for mortgage financing. What to others think about this language?

Is the buildout mortgage committment tied to the documents requiring 100%?

Note that the earlier occurring of these two conditions must be met before the Developer is required to turnover.
The 90% figure is the "ultimate" percentage regardless of phases developed. The "compliance" provision may be trickier to learn but should be discoverable by inquiries with the municipality and county in which you are located. This might mean completion of access roads in Phase 6, for example. If these are not yet consructed and the Developer has promised the city to do that, turnover can theoretically be delayed. However, in your case it may be that the 90% is reached earlier than any construction of the final phase.

Again, I would not be to eager to release the Developer, exciting as that sounds. As much a PITA as Developers are, amateur hour with volunteer homeowners running a corporation is not a cakewalk either. And, if there has been Developer "shortcuts" in your infrastructure, you will be sorry that you took ownership before requiring the Developer to hand over a decent product.
AllumW (Florida)
Posts: 68
Posted:
Thanks Gwen. I didn't even consider the roads and those are completed in the new phase. We don't have any contact with the current board. All communication is thru the management company who also doesn't communicate well. So, we're in limbo. Paying annual assessments and individually requesting the property is maintained. Without a homeowner making inquiries, nothing seems to get done.
ToddR4 (Florida)
Posts: 23
Posted:
We just went through this exercise in December 2016.

Follow the advice recommended by others. Proceed with caution and do it with a solid legal representation and an identified property manager.

DO NOT allow a hand full of property owners who are amateurs take the lead and negotiate terms with the developer. You will LOSE.

That is a major problem with HOA's in Florida. Everyone who was a former "captain of industry" and is a know-it-all on every topic from other states from where they relocated. Be very cautious.

Good luck!
JohnC46 (South Carolina)
Posts: 14,265
Posted:
Allum

Part of what Gwen posted:

(a) Three months after 90 percent of the parcels in all phases of the community that will ultimately be operated by the homeowners’ association have been conveyed to members;

Says to me they do not have to turn over until 90% of Phase 6 is complete.
GwenG (Florida)
Posts: 669
Posted:
I understand that to mean that 90% of all the units that are ultimately to be conveyed....

This means that if there are a total of 200 units are to be conveyed including all the as-yet undeveloped/unconveyed parcels in Phase 6, that the Fl law provides that after 180 planned units are sold that turnover can begin. If Phase 6 contains only 10 units, then it is not necessary that 9 of the 180 conveyed units be from Phase 6.

The total of 180 units from Phases 1-5 are sufficient.
JanetB2 (Colorado)
Posts: 4,219
Posted:
OK ... FL State Statute for Single Famility Homes states:

720.307 Transition of association control in a community.—With respect to homeowners’ associations:
(1) Members other than the developer are entitled to elect at least a majority of the members of the board of directors of the homeowners’ association when the earlier of the following events occurs:
(a) Three months after 90 percent of the parcels in all phases of the community that will ultimately be operated by the homeowners’ association have been conveyed to members;
(b) Such other percentage of the parcels has been conveyed to members, or such other date or event has occurred, as is set forth in the governing documents in order to comply with the requirements of any governmentally chartered entity with regard to the mortgage financing of parcels;
(c) Upon the developer abandoning or deserting its responsibility to maintain and complete the amenities or infrastructure as disclosed in the governing documents. There is a rebuttable presumption that the developer has abandoned and deserted the property if the developer has unpaid assessments or guaranteed amounts under s. 720.308 for a period of more than 2 years;
(d) Upon the developer filing a petition seeking protection under chapter 7 of the federal Bankruptcy Code;
(e) Upon the developer losing title to the property through a foreclosure action or the transfer of a deed in lieu of foreclosure, unless the successor owner has accepted an assignment of developer rights and responsibilities first arising after the date of such assignment; or
(f) Upon a receiver for the developer being appointed by a circuit court and not being discharged within 30 days after such appointment, unless the court determines within 30 days after such appointment that transfer of control would be detrimental to the association or its members.

For purposes of this section, the term “members other than the developer” shall not include builders, contractors, or others who purchase a parcel for the purpose of constructing improvements thereon for resale.

(1)(b) Is why I asked what is the specific information contained in your CCR's.
(1)(c) Could apply if the Developer is NOT properly "maintaining" any amenities as noted in the CCR's.
(1)(e) Applies if the Developer SOLD the lots to another and yet DID NOT transfer development rights and responsibilities.
(1)(f) Applies if the developer is not performing and the membership has applied to submit the HOA to a receivership. This should NOT be considered unless you are in a complete total mess. The Receiver (which is generally a court appointed attorney) will include and assess the homeowner's their fees on top of your HOA assessments. If at all possible you want to avoid this scenario.

Keep in mind via the last paragraph that you potentially have many other developers building homes and they CANNOT be included in the 90% as noted in the State Law. Again, my question is does your CCR's note a different percentage???

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