Coquitlam, Princess Gate: A Michael Audain / Polygon leaky rotten condo development

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Princess Gate, Coquitlam: A Case Study by Anonymous

The Leaky Condo Case Study below was extracted from BCCondo.com.

Dr. James Balderson, aka, Dr. CondoRot, was in attendance when the submission was made to the Public Inquiry known as the Barrett Commission.

MyLeakyCondo.com is pleased to provide the following  information:

The name of the leaky condo complex is Princess Gate.

Princess Gate is located in Coquitlam, British Columbia.

Princess Gate is one of many leaky condo developments by Polygon.

The name of the author, although known to this writer, is not presented here because he prefers to remain anoymous to the public at large.

 

LEAKY CONDO CASE STUDY

Dear BCCondo.com surfers:

Below, you will find a submission made to the Barrett Commission on leaky condominiums from a strata corporation in British Columbia. The strata council of this complex has been kind enough to give bccondo.com permission to present this report to our readers. We have, however, deleted the name of the complex, strata number, and the name of the developer in order not to bring adverse publicity to the Owners.

 

Please read this report. We're sure you will find it quite thought provoking.

 

BCCondo.com is also considering a "chat line" on the site. Please E-mail us if you would be interested in this free service.

 

Technical, Financial and Social Impact Submission Paper to the Barrett Commission.


General.

  • We are legally registered and identified as Strata Corporation LMS 000. Ours is a multi-residential building built at an approximate capital cost of $14,350,000, by "ACME" Developments Ltd. on approximately 6 acres of land. This structure was a showcase multi-residential facility, targeted and built specificallly for an age group of 45 and older in a suburb of British Columbia. It was built close by to featured amenities and was resplendant in it's reputation as a quality lifestyle condominium development.

  • We have identified that we have water ingress throughout our building envelope that is acutely damaging the structural integrity of the building. We have also identified certain irregularities in the building foundation that upon close examination, may prove to be an additional impairment to the structural integrity of the building.

  • We have and continue to exercise due diligence in or assessment and approach to making our building structurally sound and in our investigation of technologies that will solve the problem of water ingress through what has been described as a poorly constructed, inappropriate architectural features of our building. The strata corporation is encountering significant difficulty obtaining plans, specifications, and other relevant technological data rom the developer/builder also referred to as the "Acme Group/Acme Developments Ltd." "Acme Developments Ltd.[the company formed to develop this strata corporation] is no longer an active company.

  • Council is considering its options at this time with respect to recovery of costs and unspecified damages, however council being cognizant of its responsibilities both legally and morally, is applying due diligence in as much as undertaking the rehabilitation of the facility. Council is of the opinion that our obligation is to rehabilitate the facility and not wait for any results that may be in our favour as a result of the findings of the commission and our pending legal actions.

Technical Component.
  • The strata corporation is a wood framed building built on a typical low rise multi- residential concrete foundation that includes a below grade parkade. The architectural style is Georgian. The exterior cladding system is principally stucco/mesh/tyvek/oriented stranboard over untreated dimensional green lumber, presumably hemlock or fir. The roof system is principally tar and gravel, with the balance being painted corrugated steel. The structure is complicated by Georgian influenced architectural details that are not indigenous to the West Coast of British Columbia. These details would impose a severe challenge under ideal conditions, to even the most experienced professional tradesman. Give that the influencing factors for developers in the condominium market are: location, price and cost to bring to market. It is now painfully clear that in the building of LMS 000 we had a recipe for inattention to detail, poor workmanship, lack of supervision, lack of inspection by competent personnel and civic authorities.

  • The 187 unit complex was built in two phases. Phase 1 was completed in the spring of 1993. Fire completely destroyed the initial Phase II of wing shortly after lock-up was initiated. Phase II was subsequently completed in the fall of 1994. Purchsers of Phase I bought their suites site unseen. A similar site developed by "Acme" in another suburb of the lower mainland, was proffered by the developer as the model of quality that purchasers could expect to discover at our strata corporation when they moved in. Interestingly enough, we have it on competent authority that this other development has been repaired twice up until now and need to be repaired for a third time at a staggering cost to the remain- ing owners. We understand that the strata corporation is considering litigation.

  • For various reasons Council became suspicious that a problem may exist with the building envelope. After some discussion Council elected to investigate the building envelope for moisture content. The contractor selected probed the building envelope utilizing semi- invasive technology and provided conclusive evidence of moisture and humidity levels in excess of tolerable limits in a number of locatins around the building perimeter. Upon receipt of the investigatin report, Council further commissioned full exposure of' suspected "hot spots" that warranted further investigation. Utilizing fully invasive technology the contractor exposed the suspect areas of the building envelope and discovered structural damage in the form of wood rot in various stages of development caused by ingress of water from unknown sources.

  • Investigation and observation of the building exterior has given rise to much speculation as to the areas of the structure that could provide access for rain water and ground water to penetrate the cladding system. Flashing, conspicuous by its absence, on horizontal stucco details are immediately suspect. We have a proliferation of such architectural details present in our building design. Failure of caulked seams and joints is also cited as a potential for water ingress and is strongly suspected. Window details are suspect as are balcony details. In addition anywhere that two walls meet is also a concern. It is also suspected that improper drainage and possibly inappropriate civil design or lack of due consideration to locally influenced, seasonal hydrological events has contributed significantly to the problem. Lack of full consideration for these signficant design components may be providing for collection of ground water into pools which then wich up the wall structure.

Financial Component.
  • Residents have been recently informed of a cost estimate submitted by the contractor for repair of the exterior envelope. The repair estimate is formatted in a best case worst case scenario. The average worst case cost per resident approaches $10,000/suite. The cost estimate submitted does not reflect any potential cost recovery from "Acme" who acted as both the developer and the builder or potential cost recovery from the home warranty program. This cost estimate also does not take into consideration any third party costs for engineering, specification writing, drawings, bid process, inspection, permits or structural repair to the building foundation.

Legal and Other Considerations.
  • Developers, builders, architects, the warranty program, insurers and other participants in condominium building programs count on the fact that condominium councils are not equipped to identify building code violations, poor workmanship, inappropriate coordination of trades or other factors that contribute to water ingress to the building envelope. They also count on the fact that very few strata councils have the knowledge and stamina to issue a writ or engage in protracted legal battle.

  • Many developers quite often practice coercion, intimidation and council infiltration tactics in order to stem legitimate complaints. It is not uncommon practice for the developer to retain a number of suites in a building and then populate those suites with sympathetic owners who have been profoundly encouraged, by the granting of favours either during construction, or upon purchase of their home. Some of these owners may even be, upon close examination, found to be directors or employees of the developer.

Psychographic Profile.
  • While there is a range of age groups at our strata corporation, it was marketed and sold as a 'mature lifestyle' development. That meant you had to be aged 45 or older to purchase here although the average age is older. We have many amenities such as an English style pub, a social lounge, a crafts room, a woodworking shop, a grandchildern's playroom, a swimming pool, and a hot tub. There is an active social committee that arranges various regular activities for our residents such as Whist, poker, bingo, movie nights, pub nights, dances, etc. Many of our senior residents sold their family home and purchased here to enjoy a carefree, active social life in their senior years. Ironically, although we have all the makings of the real community we thought we had bought into, we have instead become individual combatants in a war that can have no winner. Something that none of us expected when we purchased our homes.

  • Many of our residents, both our seniors and those who are still working, will find it extremely difficult, if not impossible, to find the money to pay the large assessments that we may shortly receive. Most of our seniors are on fixed incomes and have no prior experience with condominium living. Some suffer from ill health and/or disabling conditions. In general, they find it difficult to understand how a four year old, multi-million dollar building, built by a supposedly reputable developer, could have problems of this magnitude. They don't understand how you can have afive year home warranty program that does not cover the costs of the needed repairs.

  • Much like when one receives a diagnosis of terminal illnesses, our residents are each in various stages of grief such as denial, anger, sorrow, only a very few have achieved acceptance of our current situation. This has created an atmosphere of distress resulting in friction between owners, accusations and threats being made by one another, and assertions made by some that they will not pay any assessments. Regretfully, the Condominium Act requires us to perform due diligence and make the necessary repairs.

  • The current state of confusion, disbelief, anxiety, and tension has resulted in a distrust of the Strata Council, the property manager, and of each other. In a time when we all need to pull together and support each other, we are instead threatened by the enemy within; an unstable chaotic state of paranoia.

Demographic Profile.
  • Of the 187 strata units in our complex, one is owned by the Strata Corporation. It was originally used to house a resident building manager. It is presently being rented out at the current market rate. The assessment for this unit will e an additional burden to the owners.

  • The complex was the first of four two-phased developments to be built on this cul-de- sac by the same developer. Subsequently, a fifth two-phase complex was built directly behind us once again by the same developer. Some residents of our neighbouring complexes have told us that they have no money to undertake an investigation of their buildings. It is reasonable to assume that they too will be forced to experience financial burdens similar to ours in the near future.

  • There are currently nine suites listed for sale in our complex. All were listed before we knew we had a problem in our building. Realistically, the owners of these suites have no hope of finding a buyer. At least one of these suites is for sale due to a job related relocation.

Local Economic Impact.
  • Our complex is located in close proximity to major shopping malls. It is also close to recreational/educational and enteratainment facilities. We are one of five complexes in close proximity and it is estimated that in combination that they introduce $500,000/ month into [the] local economy. It is reasonable to assume that all of these strata corporations will face similar water ingress issues to our building. In that event, it is quite likely that the local economy will suffer from the immediate loss of disposable income.

  • The average yearly property taxes paid by each individual suite owner is $1200.00. Using that average our residents have contributed $11,000,000.00 to the municipal coffers over the past five years. We will be petitioning our City council for a reductionin our tax assessment because of the reduced market value of our homes caused by our current situation.

B.C. Economic Impact.
  • The ripple effect of this crisis is incalculable. It is an enormous problem. Almost beyond comprehension. We have attempted, however, to list some of the more strikingly obvious effects in this submission.

  • The current "leaky condo" crisis is basically having the effect of freezing the real estate market. The normal progression in the housing market is that, a condominium owner moves up to a townhouse, a townhouse owner moves up to a house. Conversely, many house owners sell their family home to purchase a condominium for the quiet enjoyment of their senior years. With the much needed publicity surrounding the drama associated with this crisis purchasing a condominium has become something no one with any small degree of mental agility would consider. This effectively breaks the cycle.

  • The ripple effect is felt by Realtors, Financial Institutions, moving companies, department stores, decorating services and so on. All of [the] levels of commerce and business will be affected by the current situation. In addition, the government will lose significant tax dollars normally collected from thePST and GST on the sale of products and services. There will also be a loss of revenue from a resultant decline in collection of the property purchase tax.

  • The loss of confidence in the competence of our building trade workers and the many Developers involved in the building industry will have far-reaching and long-term impact. There are currently thousands of people employed in the building industry, all of whom have families to support and bills to pay. Fewer sales will translate to loss of earning and purchasing power. The Governments of The Province of British Columbia and Canada will also lose much needed Provincial and Federal Income Tax dollars.

  • Many individuals living through this nightmare will suffer from some form of stress- related physical or cognitive health problems. This will place an increased burden on our over-taxed healthcare system and result in reduced productivity as condominium owners take advantage of workplace policies that provide for stress-related absenteeism.

  • In our age of instant communication and a shrinking global village, prospective investors, and those seeking to relocate to Canada, will be reluctant to consider B.C.

  • It is clear that the impact of the 'leaky condo crisis' will extend far beyond the private hardship of the individual homeowners affected. It will affect citizens who are many steps removed from the tragedy.

Recommendations.
  • Developers should not be able to set up shell companies that they then shut down when all the units have been sold. This leaves the purchaser with no one to seek redress from in the event of a problem, even when they know the principals of that shell company are continuing to profit under another name.

  • There should be a halt to the issuance of any further occupancy permits to Developers until the Developers have repaired all their problem buildings to an approved remediation standard. They should not be allowed to continue to make a profit when they are responsible for the financial ruin of tehir former customers.

  • The industry should not be allowed to self-regulate. There has been nothing stopping them from doing that prior to these hearings. They have proven themselves unworthy of our trust.

  • There should be an independent, mandatory Alternative Dispute Resolution process for every Developer and the applicable Strata Councils.

  • There should be three separate districts in B.C. for building codes.

  • Every Developer should have to post a performance bond equal to a certain percentage of the overall building cost. This bond should be held in trust for a period of ten years. This bond would be available to the Strata Corporation in the event of building defic- iencies such as water ingress.

  • Under Section 123 of the Condominium Act a Developer must call the first annual general meeting of the Strata on the earlier of the date on which 60% of the strata lots have been sold or a date 9 months after registration of the strata plan. This situation results in the developer having control of the business at that meeting as he has more votes than any other homeowner. Developers should not have voting rights at any Strata meeting.

  • The home warranty program has proven itself to be utterly useless and should be replaced with a government regulated warranty program.

  • The companies that are now reaping a windfall from the horrors of this situation should be the first to be regulated. There are too many stories of strata's that have had to go through this nightmare two and three times due to incompetent work.

Final Comments.
  • This crisis is proving to be one of enormous proportion. Mr. Dave Barrett commented to many homeowners who took thetime to speak at the public hearings he presideded over "this is not your fault, you did nothing wrong." It is not our fault and we did nothing wrong! We don't want low interest loans or tax breaks! We want those responsible, those who profited when they sold us our homes and governments who insisted on a building code that is inappropriate to our environment, to correct the problem.

  • When you buy a new car and it is determined to have a "design defect", the manufacturer usually issues a recall and then proceeds to fix the problem. Whout any cost to the car owner! If they fail to do so, government will step in and enact legislation to protect the consumer. Why is it that when the problem is related to the roof over our heads those in the building industry have the audacity to blame the buyer for not making themselves aware of the potentials of the problems associated with the building code, etc.? The buyers are victims in this instance and for some unknown reason the Developers have adopted a policy that expects each victim to pay.

  • Will our Provincial and Federal government wait until this problem drives someone to an irreversible desperate act before they take action right the worng done to its citizens? Lets hope they don't wait to find out.
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Princess Gate (Coquitlam): Marketing campaign for Polygon

  NextPhase Strategy
NextPhase Strategy produces
marketing package to sell Polygon’s
Princess Gate to active adults
 

Challenge
Market a three-phase, three-storey condominium development in Coquitlam targeted to active adults. The challenge was to create traffic at a site priced above the competition.
Solution
Pre-marketing was essential to the success of Princess Gate. NextPhase Strategy produced a marketing brochure that told the complete story for both phases of the development.

A luxurious marketing sales centre, prominent signage and beautiful landscaping lent an air of the high standard of living that would be available at Princess Gate. NextPhase Strategy produced dynamic display graphics for the elegant sales centre.

For the grand opening of the site, we ran ads in key Real Estate Weeklies, the Vancouver Sun New Homes Section, the Real Estate Channel and specific local weekly newspapers. Traffic for the first weekend was excellent, producing numerous sales. Marketing was augmented with a mail drop in older, established neighborhoods that had a high percentage of long-time owners. A promotion to win a trip for two to Alaska on a Princess Cruise line was used to draw traffic into the sales centre.

Success for marketing the development was attributed to a strong team consisting of NextPhase Strategy, the architect, interior designer and the sales group at Polygon.
  

Princess Gate - Sales Centre

Princess Gate - Brochure

Princess Gate - Sign


Princess Gate - Brochure