I met with members of the HOA board representing 3883 Turtle Creek Boulevard, otherwise known as “21,” as well as Worth Ross, the owner of their management company. If you’re blind or haven’t driven by recently, you may not know that 21 has, in recent years, undergone some very dramatic changes to the exterior of the building. Built in 1963, it’s one of Dallas’ original high-rises.
Over the past few years they have upgraded their boilers, heaters, A/C chillers, and much more. Like many older buildings, some of this work was the result of neglect arising from poor, short-term planning. They’ve also rejuvenated the façade of the building with new glass balcony railings and windows. All this work didn’t come cheap, but has put the building back on the map.
The building was in the same shape as other aging buildings without the reserve funds necessary to move it forward. Their first job was to fix what was critical. Then they got down to heavy-duty planning.
When Worth Ross took over as the management company, the HOA board at the time initiated a study to understand the long-term needs of the building and how the HOA dues would need to be structured to make that happen.
One of the things the HOA board reiterated was that they understand they don’t have the expertise and time to undertake projects like the reserve study. By selectively hiring outside experience, the job got done quicker, more accurately and without the bias sometimes found when fellow residents attempt such projects. Today, 21 has a very long range reserve study earmarking all their future maintenance projects and goals along a timeline. It’s the kind of “autopilot” system I believe all multi-family dwellings must have.
Spending Money to Save Money
Like all buildings in its age bracket, 21 was built with single-pane windows that are only slightly more energy efficient than a colander. During an incredibly invasive project that lasted about six months, all the exterior glazing was replaced with energy efficient multi-pane windows. To my knowledge, 21 is the only building of this era to have undertaken the complete re-glazing of the exterior of the building. I hope its sister-buildings are taking notes.
The results were even more staggering than expected.
Because all utilities are centralized and are part of the HOA dues (because these older buildings were built as apartments in an era before condos existed). This single bill enabled the building to very precisely understand the energy savings. Utility-related gas and electrical usage plummeted 40 percent. Utility costs dropped as well, but not as linearly due to cost fluctuations.
Because electricity prices have been more stable than gas, costs are more accurately understood. The window replacement project has saved the building about $122,000 a year, a drop of 24 percent. The glazing cost roughly $2.7 million according to Jimmy Fortuna, 21 Treasurer.
It’s true that the payback in dollars is long. It’s estimated to be 22 years. But considering these windows will last for at least another 50 years, it’s money well spent if you’re playing the long game.
Board president Josie Johnson added that another 20 percent will be saved on electricity in coming years. These saving are due to a renegotiated contract, LED lighting in public areas and hallways, and the replacement of an A/C cooling tower.
So encompassing is their planning that they even evaluated the fans in the garage used to vent vehicle exhaust. They were able to replace the fans with energy-efficient, less-powerful models because over the past 50 years, car exhaust is cleaner (no lead) and there’s less of it. It’s something that makes perfect sense, but one most of us wouldn’t think of. It’s one more example of experts being worth the cost.
Paying the Piper
To pay for this work, the building took out a $2.9 million loan (including the interest). For each unit this translated into about $7,687 of special assessment that could be repaid in three years at around $213/month.
In 2014, after the special assessment was completed, the ownership voted to continue to fund the plans laid by the reserve study and raised dues 19 percent. This delivers $750,000 a year into their reserve fund … a very healthy contribution.
Some of you may be wondering how I jive this with another high-rise I wrote about in December. It’s easy: This building isn’t fixing years of structural neglect, it’s a plan to revive an aging building with newer, energy-saving technologies. The funding is also not nearly so onerous and the benefits are tangible to every owner, every day.
Is anyone griping about the monies spent? No. The savings were only part of the benefits gained … in the second part of this article I write about the sometimes unexpected perks that came with all this work.
Remember: Do you have an HOA story to tell? A little high-rise history? Realtors, want to feature a listing in need of renovation or one that’s complete with flying colors? How about hosting a Candy’s Dirt Staff Meeting? Shoot Jon an email. Marriage proposals accepted (they’re legal)! firstname.lastname@example.org