Show Me the Money

  • Posted: March 23, 2015

The 111 East Chestnut Condominium Insider Show Me the Money  Jerry Maguire got it. At the March 19 Board Meeting, 111 Treasurer Diana Shay apparently got it, too. On February 16, 2015, she answered the demand “show me the money!

In summary, Shay reported:

– The operating accounts held $84,464 at the end of the month; and the replacement reserve accounts held $376,465.

– The unit owner accounts receivable balance was $234,281, less an allowance for uncollectible accounts of $155,301, resulting in a balance of $78,980. Prepaid assessments totaled $83,32.

– January had a budgeted net operating surplus of $43,414, however that resulted in an unfavorable budget variance of $34,444 (79%). This unfavorable variance is due to janitor union benefit expense and legal fees. Of Note: Kovitz Shifrin Nesbit was paid some $32,841 for two months of legal services for the 2013-CH-24832 and 2013-CH-24252 lawsuits (two of our six present lawsuits), $24,988.94 and $4,989 respectively.

– And the term loan had an outstanding balance of $628,143; and the line of credit had an outstanding balance of $494,575 at the end of January. Bottom line: WE ARE STILL OVER A MILLION IN THE HOLE. (Keep in mind the pace at which we are paying this down. Last month Shay reported that for the month ending December 31, 2014, the Barrington Bank Loan outstanding balance was $655,521 and the Line of Credit had an outstanding balance of $494,575.)

Wait, it gets better…

A million in the Hole, who cares, we got credit. – Last month, “in light of the [degree of the] unexpected expenditures required to comply with the City of Chicago’s Life Safety building inspection [read failure],” our management company asked the board to reconsider projects earmarked for reserve expenditures in 2015. It was at that very meeting that Board President Milazzo made a motion to approve the Oswego-based Inside-Out Company’s bid of $438,000. Of note: The ink not yet dry on the 2015 budget, the hallway project was budgeted at $400,000. Milazzo, Shay, Santogrossi and Greene voted yes. Gajderowicz and DelMonico votes not and Brush abstained. The motion passed.

Insult to injury, this month Property Manager Rudnik reported that once an electrical engineer proposal is approved, Inside Out will proceed with the engineer in preparing the necessary drawing to apply for a permit. The permit process will take approximately 4 weeks.

Speaking of the City Inspection failure, shhhhhh. – Surprisingly, considering the extent of the recent violations, there was no mention at last week’s board meeting.

Now in January there was a rush of activity: The basement wood flooring has been replaced. There was drywall repairs to multiple floors done by Golf Construction. RFPs were sent out to vendors for pricing on the 42 doors that need to be upgraded to a higher fire rating. And management continued to work with unit owners to ensure door close and latch properly. Management had also met with RCN to discuss cable boxes in the stairwell and how they will need to be adjusted in order to allow proper clearance.

And at February’s Board meeting, management boasted of securing a “variance” with regard to Chicago Exit Ordinance 13-160-050. Actually, Rudnik announcement was a little premature. On Thursday March 5, Elizabeth Scanlan who heads the LSE initiative met with John Javorka, chief Engineer from the Chicago Fire Department. It was then they concluded that the distance interpretation of the door ordinance would allow for A and K units to only have one door.

Anyway, at the February board Meeting, Rudnik also reported that management is investigating to “see if there might be a chance in getting a variance on other violations.” Apparently, that’s now what we’re bankin’ on. At the March 19 board meeting, a homeowner asked why there’s wasn’t a “progress update.” No answer was given. Apparently, with the City now planning to do a second inspection (prior to court), it looks like Director Brush’s twice previously asked for “walk thru” is still “ongoing.”

Remember the serious concrete issue, well… never mind. – About three months ago we reported that there was concrete issues in A units approximately in floors 23 through 27. As we reported then, word has it that when the building was built, there was a cold snap and subsequently some bad pours resulted. Management had Mike Bonick of KGH to do a “sounding.” Indeed, according the Bob Graf, “Bonick’s report show areas.” However, according the Sudler: “He does not believe that it requires immediate attention. He has suggested that we implement a concrete repair program to be included in our upcoming revision to the Construction Rules.”

That got a rise out of the board. Director Gajderowicz who has the problem in one of her units said, “This is the third meeting where we’ve not gotten a plan from management.” Director Brush “How are you going to monitor the cement problems?” Gajderowicz then added, “It’s not going to fix itself! In the past, there were holes in ceilings and we had to move people into hotels.”

Anyway, never mind.

Speaking of the Jedi Mind trick, there’s no plumbing problem here either.
– At the March 19 Board Meeting, a homeowner asked why we have not heard any more about what was months ago presented as a serious problem with plumbing “swing joints.” Months ago, building engineers Ceci and Block reported that on various floors, the plumbing swing joints needed to be replaced. That was underscored by them saying that for A and K units, this issues could entail ripping out kitchens.

Like its follow up to the LSE inspection failure, management was silent here. Duska whose toilet is presently in her living room, was dumbfounded.

The anonymous homeowner then reported that the word was that there was recently a cross section taken on a 3.5 inch galvanized pipe and that due to 40 years of corrosion less that a half inch was left open. Management responded that Loehr & Sons Plumbing Inc. are our plumbers and they were not seeing that. The homeowner then stated that that opinion was from Loehr directly. According to Loehr: “Think of an old elephant with a heart condition. 111 could have a heart attach at any time. In five years the chances are 100 percent. And there will just be no water.”

Again, never mind.

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EDITOR’S NOTE: In a related matter, real estate broker Vince Scott and Board Member Glenn Greene still can’t sell their units.

1 Comment

  1. Daniel · March 28, 2015 Reply

    Vince Scott and Glenn Greene are overpriced with lousy view and floor level. They need to drop price $100K

    Seems like the money pit here

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