Virus affirms assertive Condo and troubles AirBnb

According to the South China Morning Post, the latest update on the Wuhan virus is close to 4500 people infected in China, with 106 deaths. “In addition to air transmission, the coronavirus can be spread through physical contact, China’s National Health Commission (NHC) said on Tuesday” (SCMP 28 Jan 2020)

No doubt our government is highly concerned and has swiftly implemented measures to keep Singapore safe. These include tracking at risk personnel and keeping them quarantined. I recall the overly restrictive (but on hindsight, forward-looking) rules of People’s Park Complex. Last August they decided to track and restrict visitors for vice. I believe the residents now benefit from an additional layer of administrative protection from the Wuhan virus.

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Case study: Killer lifts?

Once in a while we hear of killer litter offences. Yet there is another high-rise danger lurking; the killer lifts are often forgotten. (Some say killer pools.) These silent killers have a stranglehold on our finances through high maintenance and a large one-off sum for replacement at the end of their life spans.

We look at an example of an almost two decade old condo in District 21, with approximately 341 units. In the AGM previously, a list of facilities were drawn up to highlight their replacement costs due in the coming 3-5 years. They amounted to almost $11.5 million!

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Condo maintenance pitfalls

 “too little, too late”

Petróleos Mexicanos (Pemex) is the state-owned petroleum company of Mexico. In its prime, Pemex had assets worth $415 billion. It was also the world’s second-largest non-publicly listed company in 2005.

Today, Pemex is the world’s most indebted oil company with $176 billion of debts and liabilities. The Mexican government announced a $5 billion bailout for the company this year. However analysts say it needs to invest at least $10-$13 billion a year.

How did that happened over less than 15 years? Well, in short, years of disregard and non-maintenance. This is similar to managing a condo. Take for example the following chain of events:

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AGM fanfares

If you can’t convince them, confuse them.” – Harry S Truman

About five years ago, I was invited to an AGM as a guest and observer. The development had more than 300 owners and a quarter of them had turned up at the country club. There was refreshment and small bites. Imagine the costs.

Not this condo, but nonetheless a good read. (It’s your money, as well as other residents’.)

The preceding AGM was rowdy enough to justify a security team on duty this round. The agenda checked most of the usual; monthly maintenance, appointment of MAs, Council members, additional parking lot, some minor by-laws. Blew $16k and four hours over squabbling small issues.

Surprisingly, nobody raised any of the macro issues. Nothing about long term pipeline replacement of big items.

As I referred to notes about the financial details, it became clear many were missing the 200-Pound Gorilla in the Room. In summary, their fight over an extra $50 monthly was insignificant compared to a ticking $1.2 million replacement cost in two years time.

I wonder if there is a rising trend of similar cases in Singapore. A point of view suggested by my friend Thomas was that young families who became new condo owners have their hands full with their children and career. And they in turn form the majority of non-attendees to AGMs.

Related posts: “Condo maintenance pitfalls?”