The HOA Detective’s monthly round of condo misadventures has unearthed this doozy which sits less than 3 miles to the southwest of the ill-fated Champlain South Tower building on a spit of man-made “land” in the middle of Florida’s Biscayne Bay.
Just another stone’s throw from the Majestic Isle Condominium in North Bay Village is the Palm Bay Yacht Club (PBYC), less than 2 miles further to the southwest on the western shore of the Bay.
Followers of the HOA Detective will remember the PBYC and its sorrowful and expensive tale of structural problems, which led to a $175K per unit special assessment against the 136 condominiums in that 40-something condo tower.
In the case of the Majestic Isle property, it remains to be seen what the final price tag will be or where the 55 residents will live, now that they have been ordered to evacuate the building after a mandatory structural inspection earlier this month. Kudos to local building officials who appear to have put some pep in their step in an effort to identify potentially unsafe buildings after the disastrous 2021 collapse in Nearby Surfside, FL.
The good news is that nobody has died as a result of poor maintenance, shoddy construction or irresponsible stewardship of the condominium.
The bad news is that Majestic Isle is a 63-year-old concrete structure situated on a waterfront location and based on the satellite images on Google Earth, Zillow, and other sources, the roof is indeed a sorrowful tale.
Crossing the continent and into the Detective’s own backyard, we have also learned that the 206-unit Quintet Condominium has recently approved a $5M special assessment, which imposes a series of monthly payments for the next 5 years.
The good news for the mid-90s era Quintet Condominium is that the buildings aren’t nearly as old as the hundreds, if not thousands of condominiums that line the waterfront from one end of Florida to the other.
The bad news is that the Association has been shuffling money in and out of the reserve fund for years without really gaining much ground in the ever-present struggle to actually accumulate replacement reserves at a rate that is at least commensurate with the economic depreciation of the common elements. Known in the business as the “pay-as-you-go” approach to reserve funding, the strategy eventually catches up with stakeholders in a version of financial musical chairs.
The question for current owners and prospective buyers alike in this situation is two-fold:
1) When will the music stop?
2) Will the Association have enough money set aside to pay the long-term maintenance and renewal bill when it comes due?
The due date for major reserve spending is the point at which the music stops in our analogy to a game of musical chairs. If you are a stakeholder in this real-life version of the game when a life-changing special assessment is levied, you are akin to those participants that do not have a chair when it comes time to sit down.
This is why we say Because You’re Buying More Than a Home!
– HOA Detective™