Financial Insecurity
Our assessments have risen every year and will most likely continue to do so....forever.
Relative to other buildings of our size and age, they are high.
Our reserves are slightly over 2 million dollars, based upon unaudited statements of Feb 2014. On the debit side of the ledger, we have outstanding long term liabilities of approximately $275,000 which were incurred principally for the curtain
wall repair project, completed in 2010. Prior to the assumption of this obligation, Park Tower was debt free.
Under the rules of our condominium declaration bylaws, loans may not be assumed by our association, the reserve
must be utilized first. This document states that all financial obligations entered into by the board must be settled
by July of the next calendar year, to be paid by a special assessment, levied against unit owners, if necessary. A given sitting
board may not encumber our association with a long term debt, certainly not without approval from a majority
of the association members. Without this safeguard, a board could severely burden our association for many years
into the future, well beyond their tenure (and probable unit ownership). This safeguard has been violated.
We have at least 3 major projects in the works or planned for in the near future. The ongoing riser project,
the driveway replacement and the new roof proposal are big ticket items that will further erode our
reserve funds and require additional increase in our already
high assessments.
Harbor Point, at Randolph and Lake Shore Drive, is our sister building. This building was completed in 1975,
making it 2 years younger than ours. It was designed by the architectural firm of Solomon, Cordwell
and Buenz, the same firm that designed Park Tower. The design scheme is very similar to that used in our building, built with the same construction materials
(reinforced concrete with a Meisian style curtail wall facade) and is comparable in size and physical
appearance to Park Tower.
“This expertly maintained building is a model for fiscal responsibility and offers a thirty-year track record
without a special assessment, and maintains a multimillion dollar reserve fund.”
Another building of comparable design,
Lake Point Tower, located near Harbor Point, was completed in 1968. Interestingly,
all 3 building share a
triangular shaped core. This type of design facilitates a very strong central shaft, making it possible to construct
a very tall building, accentuating the external view at the expense of internal square footage.
“As of December 31, 2010 the association had no debt and capital expenditure reserves exceeding $3M.
Assessments have remained level for 2011 and the preceding two years. No special assessments are anticipated and
none have been levied during the past 8 years.”
The residential units in each of these buildings are far larger than ours. On a square footage basis, their assessments are
actually lower than ours, when compared against our studio and one bedroon units. I invite you to research and confirm this for
yourself. Consider also that the common elements in each of these building are larger than ours and that
these buildings are located in one of the most expensive areas of the city, where the cost of living
is much higher than in Edgewater. Now why are their finances in such better shape than ours and their assessments
proportionately lower?