Reserve Study: Alpenrose Condominium Association

Transcription

1 Reserve Study: Alpenrose Condominium Association The Alpenrose Condominiums 74 Erste Strausse Snoqualmie Pass, Washington Originally Prepared October 5 th 2009 Updated with inspection November 15 th 2010 Updated with inspection October 12 th 2012 For Period Beginning: September 30, 2012 Ending: October 1, 2013 Prepared for the Alpenrose Home Owners Association by: Carlson s Alpine Maintenance. PO Box 210 Snoqualmie Pass, WA Tel. (425) Fax (425) alpenrosemanager@hotmail.com Alpenrose Reserve Study 2009 Page 1

2 Introduction A Reserve Study is an important tool used to forecast the costs of maintenance as buildings, and all their physical assets, begin to age. The goal of this study is to itemize each individual asset, known as a Component, and assess the remaining life versus the projected cost of repair or replacement. This will determine the most significant expenditures your Association is facing and plan a course of action to follow in preparation for these inevitable costs. A properly followed Reserve Study will establish a healthy Reserve Fund, and a healthy Reserve Fund will reduce, and potentially eliminate, special assessments for any predictable maintenance expenditures. In this report you will find: A) A list of Components that you are Reserving for. B) An evaluation of your Reserve Fund size. C) A recommended plan for Reserve Funding. D) Tables detailing all the factors considered in determining your Reserve Plan. Some Component s repair/replacement costs and lifespan have yet to be determined. In these cases we are waiting on crucial information from industry specialists to more accurately determine the costs and timeline. Please feel free to contact Carlson s Alpine Maintenance if you have any questions what so ever. It should be noted that this Reserve Study was researched and compiled by the resident manager of the Alpenrose Condominiums, John Carlson. Mr. Carlson and his wife Heather are also owners of unit number A portion of the information gathered for this Reserve Study was based on his 13 years of experience and his intricate dealings with all of the Components at the Alpenrose as their manager. Alpenrose Reserve Study 2009 Page 2

3 Reserve Fund Components Listed below are the twenty-four components that will require reserve funding attention and a brief overview of their general condition. With each description you will find an estimated cost of repair, estimated cost of replacement and estimated remaining life. For your convenience, the number of each component corresponds to it s row number as listed in the following tables. 1) Siding. The Alpenrose has approximately 12,000 square feet of plastic siding located on the ends of each building. The PVC siding on all three buildings is in good condition. During the summer of 2012 Tri-State Roofing was hired to replace the few cracked pieces of siding and repair areas where snow had damaged the vinyl siding. With the completion of this work an extended life can be expected. Approximate cost of repair: Less than $5,000. Remaining useful life, 38 years. Estimated cost of replacement, $25,000. On the sides of each building the siding at the first floor is plywood with textured paint and above the first floor is vertical wood T&G. This siding that is protected by the roof is in good condition, areas not protected by the roof show some weathering but remain sound. Remaining useful life of unprotected siding, 18 years. Estimated cost of replacement $10,000. 2) Decks and Railings. Surrounding the front and back of each building are several decks and railings. Some of the decking on the second story porches was shown in previous inspections to have rot in places. Upon this inspection, we have found that the rotted boards have been replaced. Approximately 50% of the existing deck floorboards have been replaced within the last 5 years. The remaining 50% have been inspected and found to be free of any damage that would require any reserve funding. Ground level deck railings and posts require little maintenance costs and if regularly maintained by the manager should not exceed $1,000 a year. Approximate costs of repair, $10,000. Remaining useful life, of main deck structure, twenty years. Estimated cost of replacement, $87,500. Newly repaired deck building two. Alpenrose Reserve Study 2009 Page 3

4 3) Boilers. The Alpenrose has three working boilers total, one per building, to provide hot water for all condominium units. The boilers are in good working order, however after nearly 40 years of service, routine maintenance can be expected. MacDonald Miller has proposed recommendations for maintenance on each boiler. Approximate cost of repair: $4,500. Remaining useful life, 18 years. Estimated cost of replacement, $28,500 per boiler. There are also three un-used boilers formerly needed to heat the driveways and roofs. The driveway and roof heating system is no longer in operation because of leaks in the hot water lines. Boiler room, Building three. Note; smaller boiler on left formerly used to heat roof and driveway. 4) Paint. A) Interior. The Alpenrose hallways and stairwells make up a total of approximately 25,000 square feet of painted wall space. The interior of all three buildings was repainted in With routine maintenance and touch ups the current interior paint should not be in need of replacement for 20 years. If the manager was not able to paint total cost of repainting would be in the $20,000 range. B) Exterior. Approximately 19,200 square feet of exterior painted walls exist. Exterior paint is showing signs of wear in places. Maintaining the integrity of existing paint by touching up as needed will extend the life of this component. Approximate cost of repair, $500 annually. Remaining useful life, 10 years. Estimated cost of replacement, $30,000. 5) Garage doors. The main entrance garage door was replaced in No repair work should be needed for five years, however due to the likelihood of a car collision with the door and general wear and tear on door parts/accessories, regular budget funding and reserve funding should be maintained. The emergency cold weather doors between buildings do not get regular use therefore should not need replacement. Regular budgeting for inspection should finance any needed repair. Remaining useful life, 7 years. Estimated cost of replacement, $5,000. 6) Windows. A total of 36 windows line the hallways and stairwells at the Alpenrose. Windows in all three buildings were replaced in They remain in excellent condition and should not need replacement for many years. Alpenrose Reserve Study 2009 Page 4

5 7) Laundry Facilities. The laundry facilities at the Alpenrose consist of two coin operated washers and two, stacked, coin operated dryers. These machines vary in age, the washers being one and five years old, and the dryers being three years old. Because they vary in age we have averaged the remaining life and the cost of replacement. Remaining useful life, 10 years. Estimated cost of replacement, $4,500. 8) Domestic water plumbing system. The domestic water plumbing system in the Alpenrose consists of approximately 20,000 feet of galvanized steel pipe. Galvanized steel pipe has a life expectancy of up to 100 years but has also been known to fail much sooner than that in some instances. One positive aspect of the domestic water plumbing system at the Alpenrose is that the water running through the pipes is extremely pure, which helps keep mineral build up to a minimum. The fact that no maintenance work has been necessary on this system to date should not keep the Alpenrose from setting up a reserve to deal with what the future might bring. Repair and maintenance work will be expensive due to access restriction and labor costs. After thorough inspection the system has proven to be in good working order with no signs of restriction or loss of pressure. Remaining useful life, 60 years. Estimated cost of replacement, $300,000. View of domestic water supply plumbing, building two. Alpenrose Reserve Study 2009 Page 5

6 9) Sewer water plumbing. The sewer pipes remain in fair condition. The sewer system consists of approximately 15,000 square feet of iron pipe. This system was built to last the lifespan of the buildings themselves and shows very little signs of deterioration. That being said, sewer pipes should be regularly maintained to ensure unforeseen problems from occurring. A reserve fund should be established to prepare for the expensive and messy nature of sewer pipe malfunction. Remaining useful life, 60 years. Estimated cost of replacement, $300,000. Detailed view of sewer pipes wrapped in insulation. 10) Circulating/booster pumps. Each boiler has one booster pump to keep hot water circulating through the pipes. Booster pumps have all been replaced within the last ten years. The life span of these pumps and their parts should provide for another ten years of service. The price of the pumps, and their parts, are small enough that reserve funding is not necessary. Circulation pumps are used to push hot water continuously through the system so there is no wait for hot water from the sink or shower tap. Alpenrose Reserve Study 2009 Page 6

7 11) Electrical Circuits. The circuit breakers in the common area hallways have all been upgraded to eliminate any potential problems. The work was done in the summer of Remaining useful life, 47 years. Estimated cost of replacement, $4,000. Detailed view of circuit breaker box in building one. 12) Alarm system. The Alpenrose has one alarm system which was installed in building two after it was burned in The alarm system is functional at the time of this inspection. However, notes on the annual inspection report state that this is an aging system with parts that are becoming more and more scarce. Repairing system if major problem occurs may be as costly as replacing system before problem arises. Cost of replacement TBD at annual inspection. Detailed view of smoke detector, sprinkler head and the alarm system control panel located in managers unit. Alpenrose Reserve Study 2009 Page 7

8 13) Sprinkler system. There is one fire suppression sprinkler system in place at the Alpenrose and it was installed in building two in Building two burned down in an arson fire in 1978 and in order to be code compliant was rebuilt with a fire suppression system. The sprinkler system is functioning well at this time. Main dry valve was replaced in the spring of The Dry valve is the main functioning part of the system, thus the life expectancy of the system is high. Remaining useful life, 28 years. Estimated cost of replacement, $5,000. Currently, there is no sprinkler system in place in buildings one and three. The ownership is in the process of considering the installation of a sprinkler/alarm system and the associated costs which can range from $30,000 into the hundreds of thousands. Detailed view of sprinkler riser system located in building two. 14) Roof structure. The roof structure consists of four layers of material. The bottom layer being 3x6 tongue and groove car decking. Above that lies two inches of concrete reinforced with steel wire and the steel pipe formerly used to heat the roof. A layer of torch down composite roof sits above the concrete and functioned as the exposed roof until the plastic Duro-Last roof was installed in Duro-Last roofs come with a 15 year warranty and a forty year life expectancy. Remaining useful life, 27. Estimated cost of replacement, $162,000. Left: View of roofs. Right: Cross section of roof construction taken from access hatch cut out in building three. Alpenrose Reserve Study 2009 Page 8

9 15) Roof safety systems. Roof access hatches for snow removal, and anchor points for safety, are an essential part of the roof maintenance plan and should be inspected regularly. Our inspection finds them in excellent working condition. Because the life expectancy of these components is long and replacement is relatively inexpensive a minimal reserve fund should be sufficient in preparing for the future. Roof safety equipment installed with the Duro-Last roof showing very little signs of wear. 16) Fascia. Approximately 800 feet of fascia board surround the roofs of the Alpenrose. The fascia boards we inspected and repaired where needed in the summer of New cedar replaced the old where necessary. The fascia received new flashing and new drip edges where needed which should prolong the life of said areas. Remaining useful life, 27 years. Estimated cost of replacement, $10,000. Left: Detailed view of green mold growing on old fascia boards, building one. Right: New fascia board with drip edge. Alpenrose Reserve Study 2009 Page 9

10 17) Roof eves and soffits. Signs of potential dry rot may have damaged the roof eves in many places, however in the summer of 2010 all areas of damage were repaired. Remaining useful life 38 years Estimated cost of repair, $40,000. Left: Detailed view of dry rot in eves, buildings two and three (2009). Right: New eves, back of building three (2010). 18) Pool surface. The pool at the Alpenrose was replastered in the summer of Along with this repair, new coping stones were installed as well as depth marking tiles and bench/stair marking tiles. With proper maintenance pool plaster should have a life of 15 years. Remaining useful life, 13 years. Estimated cost of replacement, $35,000. Newly replastered pool with new coping stones. 19) Pool Deck. The pool deck will be in need of resurfacing at some point soon. Some problems include: A plugged field drain, cement pitted/falling apart, and a fence that is damaged by snow every year. We strongly recommend a heated deck to eliminate the build up of ice and a potential slip and fall injury lawsuit. Pool fence should also be replaced at the time of deck replacement. Remaining useful life, 20 years. Estimated cost of replacement, $35,000 Alpenrose Reserve Study 2009 Page 10

11 20) Pool Heaters. The pool heat is controlled by two Coates brand electrical heaters. The workload for these heaters is put to a full test throughout the course of a winter as pool temperatures of 100 degrees are regularly reached. This puts stress on the components of each heater and therefore requires regular maintenance and repair. The components for electrical heaters are expensive and at least $1,000 should be budgeted annually for pool heater parts. The current manager has taken on the responsibility of maintaining the pool heater s components, eliminating labor costs. The costs of hiring someone for this work will easily double the amount of money to budget. Reserve funding should not be necessary unless the manager cannot perform the maintenance work. Remaining useful life, 10 years. Estimated cost of replacement, $4,150 per heater. Pool heaters (left) and detailed view of their electrical layout (right). Fuses, Contactors and Elements typically burn out in a matter of three to five years. The expensive nature of heater components keeps pool heater maintenance costs high. 21) Pool Pump and Filter. The remainder of the pool s operational parts is made up of the pump and the filter. These two parts are under the stress of regular day to day operations. The pool filter was replaced in 2012 and has a life expectancy of 15 years, the pool pump was replaced in 2010 and should be expected to last another three years. Remaining useful life, 15 years. Estimated cost of replacement, $3,000. Pool components from left to right; pump, heaters and filter. Alpenrose Reserve Study 2009 Page 11

12 22) Saunas. There are two sauna rooms located in building two at the Alpenrose. The saunas are heated electrically and after 40 years of use the lifespan of these heating units is coming to an end, and more efficient heaters may be available. Remaining useful life, 10 years. Estimated cost of replacement, $5, ) Driveways (concrete). The Alpenrose has three main concrete driveways located at the main drive entrances of buildings one, two and three. During the summer of 2010 the concrete drives between buildings were replaced with new concrete. The new concrete is in excellent condition and should last at least 50 years Remaining useful life, 48 years. Estimated cost of replacement, $20, Detailed view of new concrete in driveways and catch basin draining groundwater. 24) Driveways (asphalt). The Alpenrose has one asphalt driveway that provides access from the street to the first building and covers approximately 2,600 sq ft. This driveway was repaved in 2008 and is currently in excellent condition. Remaining useful life, 16 years. Estimated cost of replacement, $9,000. Repaving of main driveway. July, Alpenrose Reserve Study 2009 Page 12

13 Your Reserve Fund Very simply, a Reserve Fund is meant to be a savings account. The maintenance schedule of your buildings allows for several years between times when it is necessary to withdraw funds from that savings account for repairing components. During these years of limited or no Reserve spending the Reserve Savings can be used to invest or simply accrue interest and become another source of income to help cover the rising costs of building maintenance and repair. The Alpenrose Condominiums Reserve Fund was established in 2009, and currently 3% of the annual budget is set aside for Reserve s. The current balance of the Alpenrose Condominiums Reserve Fund as of September 2012 is $9, An increase of nearly $7,000 since this report was last updated in With this limited Reserve balance your association is left with no other option than special assessments and deferred maintenance. Recommended Plan for Reserve Funding The objective of this Reserve Study is to develop and sustain a Reserve Funding plan. Based on your current Reserve Fund balance and your projected cash flow requirements, we are recommending Reserve contributions of $3, per month to achieve a fully funded balance. That amount is based on our estimated 2012 costs and reflects a 0% rate of inflation. The inflation rate can be adjusted as you see fit in the future. These numbers are subject to change as more information about your sprinkler system and your alarm system becomes available. Top 5 Sewer Pipes: Due to the unsavory elements of sewer pipe and waste removal system work, it is always best to be prepared for these repairs before they happen. Domestic water plumbing: Another costly repair on a key component. Save now for the future. Boilers: Age is the most concerning factor regarding the continued function of your boilers. Following our recommendations for maintenance repair work will extend the working life of these components. Roof: Although the Alpenrose roof surface is relatively new, a solid roof is one of the most important features of any structure. Saving for the associated costs and planning for its replacement is imperative. Pool Deck: A combination of a fence which is damaged yearly and sometimes icy pool deck make for a problem waiting to happen. A heated deck will eliminate the potential for a slip and fall lawsuit. Alpenrose Reserve Study 2009 Page 13

14 Terms and Definitions Component: Any part of a condominium complex that is commonly owned and requires anticipated maintenance or replacement. Effective age: The difference between Useful Life and Remaining Useful Life. Full Funding: A Reserve balance that is in direct proportion to the remaining life and current repair or replacement costs. Useful Life: The estimated time (in years) that a common area component can be expected to serve its intended function. Remaining Useful Life: The amount of time remaining (in years) between installation and need of replacement that a common area component can be expected to function. Alpenrose Reserve Study 2009 Page 14

15 Tables and Descriptions Table 1 summarizes your Reserve Fund Components and details the monthly Reserve contribution needed to fully fund your Reserves. Table 2 provides the main component description, life and cost factors for all components determined to be appropriate for Reserve designation. This table represents the core information from which our projected costs are derived. Table 1 Rem. Useful Life Current Average Cost Of Replacement Monthly Reserve Funding Contribution Useful # Component life 1: Siding $25,000 $55 2: Decks and railings $87,500 $365 3: Boilers $92,500 $428 4A: Paint (Interior) $20,000 $152 4B: Paint (Exterior) $30,000 $250 5: Garage door 10 7 $5,000 $59 6: Windows $17,500 $44 7: Laundry Facilities $4,500 $37 8: Domestic water plumbing $300,000 $416 9: Sewer water plumbing $300,000 $416 10: Circulating/booster pumps $800 $4 11: Electrical Circuits $4,000 $7 12: Alarm system TBD TBD 13: Sprinkler system TBD TBD 14: Roof $210,500 $650 15: Roof Safety $4,000 $11 16:Fascia $6,000 $18 17: Roof eves and soffits $40,000 $87 18: Pool Surface $35,000 $192 19: Pool Deck $35,000 $146 20: Pool Heaters $4,150 $35 21: Pool pump and fliter $1,600 $9 22: Saunas $4,000 $34 23: Driveways (Concrete) $20, $167 24: Driveways (Asphalt) $9,000 $47 Alpenrose Reserve Study 2009 Page 15

16 Table 2 Remaining Best Cost Worst Cost Current Best # Component Useful life Useful Life Repair Repair Replace Cost Replace 1: Siding $1,000 $5,000 $20,000 $30,000 2: Decks and railings $200 $2,000 $75,000 $100,000 3: Boilers $4,000 $5,000 $85,500 $100,000 4A: Paint (Interior) $3,000 $5,000 $15,000 $25,000 4B: Paint (Exterior) $200 p/y $500 p/y $30,000 $40, : Garage door 10 7 $200 p/y $500 p/y $4,000 $6,000 6: Windows N/A N/A $15,000 $20, : Laundry Facilities N/A N/A $3,500 $5,500 8: Dom. water plumbing N/A N/A $200,000 $400,000 9: Sewer water plumbing $10,000 $20,000 $200,000 $400,000 10: Circ/booster pumps 20 8 $200 $500 $600 $1,000 11: Electrical Circuits N/A N/A $3,000 $5,000 12: Alarm system N/A N/A TBD TBD 13: Sprinkler system N/A N/A TBD TBD 14: Roof N/A N/A $162,000 $259,000 15: Roof Safety N/A N/A $2,000 $6,000 16:Fascia $2,000 $10,000 $2,000 $10,000 17: Roof eves and soffits $5,000 $10,000 $5,000 $10,000 18: Pool surface N/A N/A $30,000 $40,000 19: Pool Deck $500 p/y $1,000 p/y $30,000 $40,000 20: Pool Heaters $500 p/y $1,000 p/y $1,200 $2,000 21: Pool pump and fliter N/A N/A $3,000 $5,000 22: Saunas N/A N/A $3,000 $5,000 23: Driveways (Concrete) N/A N/A $15,000 $25,000 24: Driveways (Asphalt) N/A N/A $8,000 $10,000 Cost Current Worst Alpenrose Reserve Study 2009 Page 16

17 Accuracy, Limitations and Disclosures Washington disclosure, as per Senate Bill6215 This Reserve Study should be reviewed carefully. It may not include all common and limited common elements that will require major maintenance, repair or replacement in future years, and may not include regular contributions to a reserve account for the cost of such items. The failure to include a component in a Reserve Study, or to provide contributions to a reserve account for a component, may, under some circumstances, require you to pay on demand as a special assessment your share of common expenses for the cost of major maintenance, repair or replacement of a reserve component. Because we have no control over future events, we cannot claim that all the events we anticipated will occur as planned. We expect that inflationary trends will continue, and we expect that financial institutions will provide interest earnings on funds ondeposit. We believe that reasonable estimates for these figures are much more accurate than ignoring these economic realities. Our projections assume a stable economic environment and a lack of natural disasters. Because both the physical status and financial status of the association change each year, this Reserve study is by nature a one-year document. This information can and should be adjusted annually as part of the Reserve Study Update process so that more accurate estimates can be reflected in the Reserve Plan. Reality often differs from even the best assumptions due to changing economic factors, physical factors or ownership expectations. We fully expect there to be a number of adjustments necessary to both the cost and timing of distant expense projections. As previously stated, John Carlson, owner of Carlson s Alpine Maintenance, is the owner of unit 1002 at the Alpenrose Condominiums and is currently the Condominium s Property Manager. That being said, this Reserve Study was preformed with no prejudice or special consideration to any factor, be it a component, it s estimated life or estimated cost, that could potentially distort the association s situation. We believe our estimates, and those made by vendors and suppliers contacted by us to be honest, accurate and reliable. No destructive or intrusive testing was performed, nor should the site inspection be assumed to be anything other than for budget purposes. Alpenrose Reserve Study 2009 Page 17

18 Reserve Study Disclosure: Alpenrose Condominium Home Owners Association Board of Directors January 2010 This reserve study should be reviewed carefully. It may not include all common and limited common element components that will require major maintenance, repair, or replacement in future years, and may not include regular contributions to a reserve account for the cost of such maintenance, repair or replacement. The failure to include a component in a reserve study, or to provide contributions to a reserve account for a component, may under some circumstances, require you to pay on demand as a special assessment your share of common expenses for the cost of major maintenance, repair, or replacement of a reserve component. Board of Directors Alpenrose Condominium Home Owners Association Alpenrose Reserve Study 2009 Page 18