| January 1, 2008 Dear Ocean Walk Owners, On December 10, 2007, Donna Bragassa, Terry Grossman and I, Susan Omil were elected to the Board of Directors replacing Herman Irizarry and Rene Vina whose terms had expired. This is the first of the monthly reports we intend to issue, informing you as to the status of our condominium. The following are some of the issues we face and the progress made during this transition period. On December 11, 2007 a new management company, Royal Management Group, was hired. They are located on 5th Street, within walking distance of Ocean Walk. Maxwell Management has provided Royal Management with many documents. One of the primary goals of the new board is to attempt to get the finances in order. We requested a meeting with the previous board members in order to be given an update. We were promised a meeting sometime in early January. Initially, we are trying to determine how much is owed by each Unit Owner for both Regular Maintenance and the $800,000 Special Assessment. Royal Management has sent out Statements provided by Maxwell Management to each Owner. If you do not agree with the statement balance, please try to provide proof (a cancelled check) so that Royal has a better chance of reconciling Maxwell’s balances with yours. We intend to update our 2008 budget for recurring monthly maintenance expenses as soon as we become more familiar with our vendors and contractors, which we hope to be very soon. Until then we propose to use the budget that was passed for the last six months of 2007 which is $25,324.25 per month. Unfortunately, it appears that we are going to require a new Special Assessment. There appears to be very little money left to finish the “ongoing “ special project that began in March 2003 (see below). In addition, we have to pay off the remaining $81,000 of the $400,000 loan that was borrowed in March 2004. Part of original “ongoing” special project included the “beautification of our building”. We have some problems with the roof, termites, etc. Last but not least, there are bound to be additional accounting expenses since financials have not been issued since 12/31/04. You will be informed about the special assessment as soon as we are able to better figure out the numbers. Regarding the above-mentioned $400,000 loan signed on March 2004,according to Ms Maxwell’s e-mail from 12/11/07, this loan balance is $81,000 and has to continue to be paid. According to some papers we were inspecting, we are paying around $8,100 a month for this loan with adjustable interest. We have no choice but to pay this off or risk foreclosure. Refinancing is impossible unless we quickly produce financials, which is highly unlikely. On February 1, 2008 the last monthly installment of the $800.000 special assessment will be due. As mentioned above, we do not have a detailed solid idea as to how much there is left to collect from unit owners. Beside the loan repayment, we still don’t know if any vendor is owed money for work already done. The new board and management company has not yet been able to gain access the Special Assessment account at Regions Bank. However, we were able to check its balance a few days ago. It was around $9,400. There were approximately $20,000 worth of checks which were written and owed to vendors. We cannot tell whether these checks were already paid by the bank. This means that there is a high probability that we will not have enough money to make the February loan payment from the Special Assessment Account unless there is a new Special Assessment. Sorry I keep making the same point. The new Directors and Royal Management were able to gain access the Wachovia Bank Operating Account (operating) by December 19 with a balance of $ 9,548.54 on that day and a negative balance by 12/24/07 after a few checks cleared. The balance is currently approximately $3,500. New bank accounts (operating and special assessment) were opened in a different banking institution to conduct future business. Several owners are in arrears, but many of them are trying to bring their accounts current. Since we have no money in our accounts and no reserves, I strongly encourage all of you to make your payments on time and to avoid late fees. One of the first things the new management company did was to call a fire company on 12/20/07 to inspect the building and several problems were fixed. (Fire extinguishers were past due, signs missing, etc). At this transition moment, we are just trying to maintain our building operating. Basically, pay electricity, gas, cable, phone, etc. The “ongoing” drop ceiling project had been stopped well before the elections. We expect to have a better idea as to the status of this after the upcoming meeting with the previous board. Hopefully, this brief detail of what we have done so far will answer some of your questions. Have a happy New Year. Susan Omil, President |
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