Condolifestyles[0117] by S//94

januaRy 2017 | volume 20 | numbeR 4

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THE SOURCE FOR INFORMATION ON COMMUNITY ASSOCIATIONS, CONDOS, TOWNHOMES, CO-OPS & HOAS

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State-of-the-Industry

Report

H OT TO P I C S, T R E N D S & I S S U E S F O R CO M M U N I T Y A S S O C I AT I O N S FEATURES...

New Laws & Court Decisions Set Boards Straight

2016 Case Law and Legislative Update for Community Associations

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WHY PAY MORE WHEN YOU CAN APPEAL FOR LESS Enforcement of the Short-Term Rental Ordinance Q & A

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table of contents COVER STORY

03 Condo Lifestyles State of the Industry Report... Hot Topics, Trends & Issues for Community Associations By Pamela Dittmer McKuen

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06 State of the Industry Legal Update: New Laws & Court Decisions Set Boards Straight By Pamela Dittmer McKuen L E G A L U P D AT E

08 2016 Case Law and Legislative Update for Community Associations By Gabriella Comstock, Keough & Moody, P.C. 16 Industry Happenings Compiled by Michael C. Davids & Sherri Iandolo 20 From the Editor 21 Directory Advertisements EVENT HIGHLIGHTS

32 Condo Lifestyles State of the Industry M A N A G E M E N T TA L K S

33 Connecting Residents Seamlessly to the Information Superhighway By Chris Smith L E G A L U P D AT E

36 llinois Property Taxes: Why Pay More When You Can Appeal for Less By Timothy Jacobs L E G A L U P D AT E

38 Enforcement of the Short-Term Rental Ordinance Q & A By Nicholas Bartzen and Howard Dakoff

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COVER STORY

by Pamela Dittmer McKuen

State-of-the-Industry

Report

The 2016 Condo Lifestyles State-of-the-Industry brought together community association professionals, homeowners and volunteers for an enlightening program of education, networking and camaraderie. The annual event took place at the historic Chicago Cultural Center on Thursday, December 8.

resented by mCD media, publisher of Condo lifestyles and Chicagoland buildings & environments magazines and websites, State-of-the-Industry commenced late morning. Information tables and vendor exhibits greeted attendees and provided expertise on topics such as fire and flood restoration, community policing, bulk Tv and

internet technology and urban landscaping. after a catered buffet lunch, the welcome message and opening remarks were delivered by michael C. Davids, president and founder of mCD media. He formally opened the program by thanking attendees, event organizers, media guests and mCD media advisory board members for their support and participation. Special

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Hot Topics, Trends & Issues for Community Associations recognition was given to the event sponsors.

THE DEMAND FOR CONNECTIVITY Davids introduced featured speaker jake Garechana of Xfinity Communities, who addressed the rapidly growing demand for high-speed Internet connectivity. Garechana cited research data that shows the number one amenity buyers and renters look for in a home today is high-speed connectivity. They want to be connected even more than they want high-ticket items such as granite countertops and in-unit laundry machines. many conduct speed tests and connections while touring properties before they

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choose a home for themselves. “The average household today has 13 devices that are connectible today,” he said. “That number will triple over the next three years.” He ended his talk with a personal anecdote: Recently, while driving his 5-year-old daughter home from her basketball practice, she asked him: “Daddy, can you text mommy and find out what’s for dinner?” “even she understands connectivity,” Garechana said.

LEGAL UPDATE association attorney Gabriella Comstock of Keough & moody, P.C., in naperville and Chicago presented an update on significant court decisions and legislative changes during the past year. Introducing the session, Davids remarked about how legislative issues and government regulation have always been an important component of State-of-the-Industry. “last year we did not have a ton of new legislation; however, 2016 did see the intro-

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duction or passage of many significant new laws pertaining specifically to community associations,” he said. “What we saw this year in many of the new laws were some form of modification or adjustments to (flawed) laws that have been passed in recent years.” most of the new legislation actually lessens the burden on those involved in community associations and makes it easier for boards and managers to conduct business. “We’ll say 2016 was a sort of correction year,” he said. (Comstock’s presentation is reported on in a separate article in this issue.)

natalie Drapac, a community association manager at Community Specialists in Chicago. The 2016 panelists were: Howard Dakoff, attorney, levenfeld Pearlstein, l.l.C.; michael elliott, attorney and partner, elliott & associates attorneys, P.C.; michael bonick, architect and vice president, Kellermeyer Godfryt Hart, P.C.; margaret Shamberger, vice president, Condominium Division, Draper and Kramer; lawrence Puder, technical operations manager, Community Specialists; milena Radjenovich, executive vice president, Chicagoland Community management; and ottis ballenger, owner, CertaPro Painters of evanston.

PANEL DISCUSSION: HOT TOPICS, TRENDS AND CHALLENGES

an edited version of their discussion follows:

another tradition of the seminar is the panel discussion during which leading professionals offer their insights and view on the most pertinent hot topics, trends and challenges facing practitioners, board members and associations today and in the coming year. The panel was introduced and moderated by

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Q: How will the legislative changes to Palm II impact the way we do business now? Howard Dakoff: Before Palm II, our industry was a little like the Wild West. There were laws that had to be followed, but that didn’t mean every board did. Most boards made a good faith effort to comply when it was convenient for them. Gary Palm, through 13 years of litigation ultimately got the ruling that reset the landscape.

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COVER STORY

But it also scared everyone. If five board members walked to the elevator, one couldn’t say, “How is the landscaping?” Other boards met only four times a year. The legislation that takes effect January 1, 2017 does not gut Palm, but modifies it to make more sense and be more practical by expanding the use of closed session. It gives boards more confidence that they are not violating anything, and it gives managers some latitude to let boards do something without feeling they could lose their licenses. Just don’t abuse it.

Q: Am I in trouble for missing the complaint policy deadline as required by the Ombudsman Act? Dakoff: No. The legislation, which is designed to take complaints, provide education and collect data, was adopted a couple of years ago. Associations were supposed to have written complaint policies adopted by January 1, 2017, but the deadline was extended two years. You haven’t missed anything. We’re not recommending our boards do anything right now because we don’t know if there will be further amendments or changes. Sit tight.

Q: How will the pension crisis in Chicago affect future property tax bills? Michael Elliott: For years politicians have known about their pension obligations, but they put off the saving part for tomorrow and the spending part for today. Today is tomorrow. You can’t keep pushing off these obligations forever. In an effort to shore up fire and police department pensions, the City of Chicago raised property taxes last summer and will continue to do so going forward. Chicago Public Schools, which is restricted by tax caps, lobbied the General Assembly and won additional funds. That tax increase will appear on tax bills received during 2017. continued on page 28

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CONDO LIFESTYLES

by Pamela Dittmer McKuen

Condo Lifestyles State-of-the-Industry Legal Update

NEW LAWS & COURT DECISIONS SET BOARDS STRAIGHT

ssociation attorney Gabriella Comstock of Keough & Moody, P.C., in Naperville and Chicago presented the Legal Update session at the annual Condo Lifestyles

State-of-the-Industry seminar held on December 8, 2016, at the Chicago Cultural Center. Her focus was on the legislative changes and court decisions that most impact how boards conduct the business of

their associations. (The full text of Comstock’s handout, “2016 Case Law and Legislative Update,” is reprinted elsewhere in this issue. Some of the cases summarized in the handout indicate unpublished opinions, also known as Rule 23 opinions, which means they are unbinding in our local jurisdictions, but they are still informative and, possibly, influential.) “Rule 23 opinions are cases that don’t carry as much weight and are typically not cases we refer to,” she said. “But we can tell a judge, ‘This case is out there and it supports our position.’ Or we can look at the arguments that have been made and know what the judges are saying in those cases.”

A RULING ON RULES In the case of Stobe v. 842-848 West Bradley Place Condominium Association, an owner sued after the board adopted a rule that limited the number of units that could be leased at one time. The owner claimed the leasing rule was in conflict with the condominium’s declaration, which granted owners the right to lease. Both the trial court and the appellate court agreed any change in the owners’ right to lease at this association must be made through an amendment to the declaration, not a rule. “The court said if you adopt rules on leasing, make sure you have the authority to do that,” Comstock said.

FORCIBLE BACKLASH An alarming trend is owner backlash in response to the Forcible Entry and Detainer judgments against them. Defendants are returning to court, sometimes multiple times, with such claims as their rights weren’t met or they weren’t served properly. Their intent is to change the judge’s mind and vacate the judgment. In one case, a defendant made nine different motions to vacate. “It’s probably one of the most frustrating types of cases for us attorneys and also for you as property managers because they never seem to go away,” Comstock said.

FALLING DOWN DOESN’T PAY Associations won two slip-and-fall cases for different reasons. One owner who fell in the building’s garbage room lost her case because the alleged conditions were open and obvious, the courts said.

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In another case, Benson v. Lioncrest Homeowners Association, an owner fell on a patch of ice in the common area outdoors and sued the association for failing to properly remove snow and ice from its sidewalks. The association’s maintenance person testified at length about the procedures for handling snow and salt. The courts found in favor of the association, saying the association had no duty to remove natural ice and snow accumulation. “This case is a good example of associations having good procedures and practices,” Comstock said. “They showed the court there was nothing more the association could do to limit their liability.” In another case, an association failed to maintain proper books and records to protect themselves. In the Villa Veneto Condominium Association v. Meilahn suit about unpaid assessments, the owner said he was not informed of a change in management companies and address change. The association differed but did not have the documentation to back up its claims and, therefore, lost.

common interest communities to develop and write their policies for handling owner complaints. Associations now have until January 2019 to do so. Also, the amended legislation extends the earliest date for when owners can seek ombudsman assistance to resolve their complaints to July 2020. “We’re all saying, ‘Don’t get too caught up in it right now,’ but it’s really important for us as members of the industry to keep it on everyone’s radar,” Comstock said. “Associations need to be thinking of more in-depth ways of dealing with owner complaints.”

LESSONS LEARNED * Case Law: Continue using best practices, but have documentation to support it. Do what you can do to collect what is due and owing without being too outrageous about it. * Legislation. If you call executive session, do your best to communicate with owners, so they don’t think things are done in secret. Vote in open meetings and provide owners with the information you can legally to show you met your due diligence. Y

PALM II REVISITED AND REVISED Perhaps the greatest change to both the Illinois Condominium Property Act and the Common Interest Community Association Act is the Palm Change. This legislation, enacted to loosen the restrictive Palm vs. 2800 Lake Shore Drive Condominium Association, expands the topics that boards may discuss outside an open meeting. Beginning January 1, 2017, boards may convene in closed session to talk about: pending, probable or imminent legislation; third-party contracts or information regarding the appointment, employment, engagement or dismissal of an employee, independent contractor, agent or other provider of goods and services; interview a potential employee, independent contractor, agent or other provider of goods and services; discuss violations of rules and regulations of the association and unpaid common assessments. They also may consult with the association’s attorney. “We all think this is awesome, and it is,” Comstock said. “One thing I see is we’ll probably have to work pretty hard next year to keep a good balance. We have to be careful we don’t have board members going down a slippery slope doing too much in closed session without communicating with the homeowners. We don’t want to go back to that. The case of Palm is still good law.” One requirement that will not change is boards must continue to vote in open meetings, she added.

OMBUDSMAN DEADLINES ARE EXTENDED The long-awaited Illinois Ombudsman Act underwent changes to its implementation timeline, extending the deadline for condominium and

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by Gabriella R. Comstock, Keough and Moody, P.C.

2016 Case Law and Legislative Update for Community Associations Following is a summary of recent legislation and case law for community associations:

Legislative Update Illinois Condominium Property Act 765 ILCS 605/18.4 1. Effective January 1, 2017, the first clause of 18.4(m), which states “ Unless the condominium instruments expressly provide to the contrary . . .”. 2. The Amendment allows majority vote of the entire board of managers, to assign the right of the association to future income from common expenses or other sources, and to mortgage or pledge substantially all of the remaining assets of the association.

Illinois Condominium Property Act and Common Interest Community Association Act 765 ILCS 605/18(a)(8) and 765 ILCS 160/1-40(b)(5) 1. Effective January 1, 2017, both the Illinois Condominium Property Act and the Common Interest Community Association Act will be amended to allow Boards to do the following topics outside of an open meeting: A. Discuss pending, probable, or imminent litigation; B. Discuss third party contracts or information regarding the appointment, employment, engagement, or dismissal of an employee, independent contractor, agent, or other provider of goods and services; C. Interview a potential employee, independent contractor, agent, or other provider of goods and services; D. Discuss violations of rules and regulations of the association; E. Discuss a member's or unit owner's unpaid share of common expenses; or F. Consult with the association's legal counsel. 2. Allows Boards to discuss any one of these six topics either in a closed session of a noticed board meeting or in a separate board meeting, even if it is separate from a noticed meeting.

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765 ILCS 160/1-47 and 765 ILCS 605/9.5 Effective January 1, 2017, Public Act 099-0569 amends both the Condominium Property Act and the Common Interest Community Association Act to provide: “Successor developers. Any assignment of a developer's interest in the property is not effective until the successor: (i) obtains the assignment in writing; and (ii) records the assignment.”

Common Interest Community Association Act 765 ILCS 160/1-5 1. Effective Jan. 1, 2017, HB 5696 amended the Illinois Common Interest Community Association Act to change the definition of "Acceptable technological means" to provide for more options for associations. 2. 765 ILCS 160/1-5 will provide: “ ‘Acceptable technological means’ includes, without limitation, electronic transmission over the Internet or other network, whether by direct connection, intranet, telecopier, electronic mail, and any generally available technology that, by rule of the association, is deemed to provide reasonable security, reliability, identification, and verifiability.”

765 ILCS 160/1-60 1. Effective January 1, 2017, if a provision of the community instruments does not conform to the Act or to another applicable law because of an error, omission, or inconsistency in the community instruments of the association, the association may correct the error, omission, or inconsistency to conform the community instruments to the Act or to another applicable law by an amendment adopted by vote of two-thirds of the board of directors, without a membership vote.

The Condominium and Common Interest Community Ombudsperson Act 765 ILCS 615/1 et seq. 1. By January, 2019, associations must have a written policy for resolving unit owner complaints. 2. Associations must also have prepared sample forms for complaints. 3. After a board makes a final decision, the complaint form must be marked “final” in writing within a reasonable time. 4. Owners may make written requests to the Ombudsperson for condominium and common interest communities’ office for assistance on or after July 1, 2020.

Illinois General Not for Profit Corporation Act 805 ILCS 105/101.01 Effective January 1, 2017, the Secretary of State may dissolve any corporation administratively if it has failed to elect and maintain at least 3 directors.

2. Deletes language providing that corrections of errors or omissions may be adopted by a majority vote of the members at a meeting called for that purpose unless other procedural requirements apply.

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Case Law Update

Abbington Trace Condominium Ass’n v. McKeller, 2016 IL.App (2d) 150913

Stobe v. 842-848 West Bradley Place Condominium Ass’n, 2016 IL App (1st) 141427

A unit owner brought a motion to vacate judgment and quash substitute service in a FED case. The trial court denied the unit owner’s motion to quash finding the special process server’s testimony to be credible. The appellate court affirmed the ruling. It found the special process server’s testimony rebutted the assertions put forth in the unit owner’s affidavit and that the unit owner failed to put forth any additional evidence. The court reiterated that normal challenges to personal jurisdiction are reviewed by the court de novo however, when trial court conducts an evidentiary hearing on the issue of service the appellate court will use a manifest weight standard of review.

This case involves a rule adopted by the Association’s board limiting the number of units that could be leased at one time. A unit owner filed suit against the Association claiming the leasing rule was in conflict with the condominium’s declaration, which granted unit owners the right to lease. The trial court granted summary judgment in favor of the unit owner, holding the declaration did not authorize the board to modify/create leasing restrictions. On appeal the Association asserted the bylaws authorized the board to implement rules limiting leasing and that such rules did not conflict with the declaration. After examining the Illinois Condominium Property Act (“Act”), the declaration, and bylaws, the appellate court affirmed the trial court’s ruling. In doing so the court applied the principals of contractual interpretation to the declaration. The court specifically noted that in order to resolve issues involving a unit owner’s rights, courts must construe the declaration, bylaws, and relevant portions of the Act as a whole. The court held the declaration placed certain limitations on leasing and therefore any change in the unit owner’s right to lease must be made through an amendment to the declaration. The court reasoned that although the declaration did not expressly remove the board’s authority to adopt leasing restrictions the question was whether the Board was granted the authority, not whether the authority was taken away. The declaration when considered with the bylaws and the Act, intended that owners have the right to lease, subject to certain restrictions in the declaration. If unit owners did not have the right to lease, there would not have been leasing restrictions set forth in declaration.

State Place Condominium Ass’n v. Magpayo, 2016 IL App (1st) 140426 A judgment and order of possession were entered against a unit owner in a FED action. The unit owner subsequently filed a motion to vacate the judgment claiming her delinquent account had been paid in full. The trial court denied the motion. The appellate court affirmed. In doing so it held the unit owner had failed to prove she paid off all delinquent amounts (required by Section 9-111 of the Forcible Entry and Detainer Act (“FED Act”) prior to the filing of her motion to vacate. The court rejected the owner’s assertion that only assessments and not attorney’s fees had to be paid in full prior to an order of possession being vacated. In support the court relied on section 9.2(b) of the Illinois Condominium Property Act (“Act”) which states that any attorney’s fees incurred by the Association that arise from an owner’s default, are to be deemed part of that owner’s share of common expenses. The court also rejected the unit owner’s argument

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that the FED Act requires an evidentiary hearing be held when a unit owner files a motion to vacate an order of possession.

Board of Managers of the 1120 Club Condominium Association v. 1120 Club, LLC, 2016 IL App (1st) 143849 An Association filed a multiple count amended complaint against the condominium’s developer and builder, including a count against the builder for breach of implied warranty of habitability. Relying on Minton v. Richards Group of Chicago, 116 Ill. App. 3d 852 (1983) the trial court dismissed the Association’s claims against the builder. The trial court held the Association could not directly sue the builder without first showing the developer was insolvent and that the Association had no recourse against it. The appellate court reversed the dismissal of the Association’s claim against the builder and remanded the case. The court held the Association’s claim against the builder for breach of implied warranty of habitability was governed by 1324 W. Pratt Condominium Ass’n v. Platt Construction Group, Inc., 404 Ill. App. 3d 611 (2010) (“Pratt I”) not Minton. Based on public policy considerations, the court in Pratt I, extended the class of potential defendants for breach of habitability to include builders not involved in the sale of residences. The court concluded that, based on the ruling in Pratt I, the issue of developer insolvency was moot. The Association could bring a claim for breach of implied warranty of habitability against the builder regardless of the developer’s status.

Wing Street of Arlington Heights Condominium Association v. Kiss the Chef Holdings, LLC, 2016 IL App (1st) 142563 This case is an issue of first impression in Illinois. The Association filed suit to foreclose its assessment lien on a condominium unit. The unit was sold at a judicial foreclosure sale to VBT (a subsidiary of the mortgagee) who subsequently began making assessment payments. Several months later VBT sold the property to a third party purchaser Kiss Chef. The Association subsequently filed an action to foreclose on its lien after Kiss Chef failed to pay 6 months worth of past due assessments pursuant to (9)(g)(4) of the Illinois Condominium Property Act (“the Act”). The trial court held VBT was not a mortgagee for purposes of imposing liability on Kiss Chef under section 9(g)(4) of the Act. The appellate court reversed and held that VBT was a mortgagee under the Act and therefore Kiss Chef was liable to the Association for 6 months worth of past due assessments. In doing so the court reasoned that since VBT was considered a mortgagee as defined under the Illinois Mortgage Foreclosure Law it should also be considered a mortgagee for the purposes of section (9)(g)(4) of the Act. The court noted that the payment of assessments by a purchaser at a judicial sale, pursuant to section 9(g)(3), does not extinguish an association’s lien rights under section 9(g)(4) of the Act. Section 9(g)(4) imposes an independent obligation on third party purchasers. Once that obligation is breached, a separate statutory lien arises under section 9(g)(4). Liability is not based on a prior owner’s delinquency but on the current owner’s failure to make payment required by the Act.

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Esparza v. Lakeview Place Condominium Ass’n, Inc., 2016 IL App (2d) 150902-U A unit owner filed suit against the Association for injuries she sustained when she slipped and fell in the garbage room maintained by the Association. The Association moved for summary judgment on the grounds 1) it owed no duty because the alleged conditions were open and obvious; 2) there was no evidence it had actual or constructive notice of the condition; and 3) there was no evidence the alleged condition was the proximate cause of the unit owner’s injury. The trial court awarded summary judgment in favor of the Association. The order however failed to set forth any reasoning. The appellate court affirmed the ruling noting that the unit owner failed to address the Association’s argument that it owed no duty because the condition was open and obvious and failed to address its argument that there was no proximate cause. The court found the notice issue raised on appeal to be irrelevant given the unit owner’s failure to address the other issues.

Mathews v. Master Property Owners Ass’n, 2016 IL App (2d) 120622-U This case involves a dispute between an HOA, known as the Master Property OwnersAssociation (“MPOA”), and one of its members. The trial court found in favor of MPOA. Pursuant to the fee shifting provision of MPOA’s bylaws, trial court awarded attorney’s fees to the MPOA including the time billed for two opinion letters that were completed prior to suit and a 6% administrative fee added to the attorney’s regular billing. The trial court denied MPOA’s request for additional attorney’s fees related to its preparation and prosecution of MPOA’s original attorney fee petition. The appellate affirmed the ruling that MPOA was entitled to attorney’s fees but modified the award amount. Relying on the plain language of the fee shifting provision of MPOA’s bylaws the court held the two opinion letters and 6% administrative fees did not fall within the bylaws’ fee provision. The two opinion letters did not involve enforcement of any of the bylaws and the 6% fee was not actually an attorney fee but litigation related costs not recoverable under the bylaws. The court however, did find that MPOA was entitled to post petition attorney’s fees. MPOA’s petition for attorney’s fees was an act to enforce the attorney fee provision of the bylaws, any post-petition fees related to the prosecution and preparation of the fee petition were recoverable.

Rule 23 Opinions South Commons Condominium Ass’n v. Ho, 2016 IL App (1st) 150608-U A unit owner filed a motion to vacate an order of possession stemming from a FED action. No personal judgement was entered against the unit owner as service was perfected by posting. The unit owner challenged the court’s personal jurisdiction to enter a money judgment. She did not challenge the order of possession. The trial court struck the unit owner’s motion since it did not have jurisdiction to rule on a motion to vacate a money judgment that was never entered. The appellate court dismissed the unit owner’s appeal for lack of appellate jurisdiction as no final judgment had been entered on the unit owner’s original motion to vacate.

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Benson v. Lioncrest Homeowners Association, 2016 IL App (1st) 160003-U A unit owner sustained injuries after slipping on a patch of ice located on a common area sidewalk. The unit owner filed suit against the HOA. It claimed the HOA failed to properly remove snow and ice from its sidewalks and that it breached its contractual obligation to prevent unnatural accumulation of snow and ice on common area sidewalks. The trial court granted the HOA’s motion for summary judgment under the theory that the Illinois Snow and Ice Removal Act (“the Act”) immunized the HOA from liability stemming from its ice and snow removal efforts. The appellate court affirmed the trial court’s ruling, but did not address whether the Act applied to the HOA. Instead, the court held that under Illinois common law property owners have no duty to remove natural ice and snow accumulations. Liability only arises if injuries occur from an artificial or unnatural accumulation of snow or ice, or an accumulation aggravated by the property owner. The court found the unit owner failed to show how the patch of ice was formed and therefore failed to meet her burden of proof that the accumulation was unnatural or aggravated by the HOA. The court also found the unit owner failed to provide a factual basis in support of her claim that the HOA breached its contractual duties.

Morningside Crescent Court Condominium Association v. Nayak, 2016 IL App (2d) 151126-U A unit owner failed to comply with the Association’s 2009 amendment to its rules and regulations governing moving. The unit owner was originally fined $4,000.00 for four separate rules violations stemming from a move he conducted. After learning that notice of the violation had been sent to the incorrect address

the Association sent the unit owner a letter rescinding the fines. The letter explicitly stated that it was not to be construed as a waiver of the Association’s right to impose fines for the underlying violations. The Association subsequently held a meeting related to the violations, which the unit owner failed to attend, that resulted in the fines of $4,000.00 being reimposed on the unit owner. The Association filed a FED action to collect on the unpaid fines. The trial court ruled in favor of the Association and awarded a fine of $1,000.00 along with attorney’s fees and costs. The trial court concluded that the fine provision was ambiguous as to whether the $1,000.00 fine should be imposed for each rule violation or for each incident (regardless of the number of moving rule violations) and therefore only awarded $1,000.00 in fines. On appeal the unit owner raised three issues 1) the Association waived its right to enforce the rules, or should be equitably stopped; 2) the Association failed to notify the unit owner of the moving rules; and 3) the amount of the fine was not reasonable. The appellate court rejected all of the unit owner’s arguments and affirmed the trial court’s ruling. The court held the Association did not waive its right to enforce the fine. The letter explicitly stated it was not intended as a waiver. The court also held that lack of mailed notice of the moving rules did not prejudice the unit owner. The court reasoned that the unit owner previously complied with all of the 2009 moving rule amendments and that this prior compliance demonstrated he knew of the 2009 moving rule changes. Finally the court held the amount of the fine was reasonable. The Association’s stated goals behind the fine were reasonable. There had been a continuous lack of compliance with the moving rules. As a result, the Association, in an attempt to create a better living environment, raised the fine amount in order to force unit owners to comply.

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CONDO LIFESTYLES

Villa Veneto Condominium Association v, Meilahn, 2016 IL App (2d) 151004-U

Scott v. 5036-5038 S. Drexel Boulevard Condominium Ass’n, 2016 IL App (1st) 151454-U

The Association filed a FED action against a unit owner for unpaid assessments. Issues regarding the unit owner’s assessment payments arose after the Association switched management companies. The unit owner did not receive notice that management companies had been changed. At trial, the Association argued that even if all of the unit owner’s evidence was taken to be true, the unit owner still owed $91 and the Association was therefore entitled to judgment and possession. The trial court ruled in favor of the unit owner finding the Association’s records and witness testimony were vague and unreliable. On appeal the Association argued it had proven a prima facie case for possession and the burden therefore should have shifted to the unit owner to prove the Association was not entitled to possession. The appellate court affirmed the trial court’s ruling. In doing so the appellate court held that the Association bears the burden of proof to possession by a preponderance of the evidence. The burden of proof rests with the party suing under the Act throughout the proceedings, the moving party cannot rely upon a lack of right in the person it seeks to dispossess. The court found the trial court’s ruling to be supported by the record. The Association failed to adequately show it noticed the unit owner of the change in management companies, failed to show the unit owner actually failed or refused to pay assessments, failed to account for all of the unit owner’s payments, and generally introduced poor records at trial. The appellate court did not address the Association’s argument that even based on the unit owner’s evidence it was still entitled to judgment and possession. The court found the Association’s failure to prove its case was sufficient ground to affirm the trial court’s ruling.

A unit owner appealed the trial court’s order dismissing her amended complaint against the Association. On appeal the unit owner argued the release executed between the unit owner and Association did not bar count I of her amended complaint and the special assessment levied by the Association was improper because it did not relate to an emergency or an improvement in the common elements. The appellate court affirmed the dismissal of the unit owner’s amended complaint. The court held the release between the parties covered any alleged wrongful act or breaches against the Association and its members from 1989 to April 2013. Therefore, the unit owner’s claim against the Association for monetary damages during that time period was barred. The court also held that the unit owner failed to properly plead a cause of action related to the special assessment. Nothing in the Illinois Condominium Property Act (“the Act”) limits special assessments to only emergency situations or to improvements to common elements. Section 18(a)(8)(iii) of the Act provides that special assessments consist of any common expenses not set forth in the budget or any increase in assessments over the amount adopted in the budget. The unit owner failed to put forth facts in her pleadings that would establish the special assessment was invalid or substantively improper.

CONDO LIFESTYLES

01.17

Madison Manor II Condominium Ass’n v. Sendorek, 2016 IL App (1st) 140930-U This matter involves an appeal and a cross appeal stemming from a FED trial between a unit owner and Association. At trial, a directed verdict was entered in favor of the unit owner as to the Association’s claim for possession.

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L E G A L U P D AT E

The trial court found the Association failed to introduce any exhibits into evidence showing statutory notice had been sent to the unit owner. The trial court then granted the Association’s oral motion for voluntary dismissal of its monetary damages claim. On appeal the unit owner claimed the trial court erred in allowing the Association to voluntarily dismiss its monetary claim, erred in making a partial directed finding on possession only, and erred in denying its motion for a directed verdict on monetary damages. The appellate court overturned the trial court’s granting of the voluntary dismissal, holding the trial court abused its discretion when it granted the Association’s oral motion. In doing so the court reasoned that the Association failed to comply with 735 ILCS 5/2-1009 and that the granting of the motion prejudiced the unit owner as the motion was made in order to avoid a likely negative dispositive finding on the merits. The court concluded it did not have to address the rest of the issues raised by the unit owner on appeal. On cross appeal, the Association challenged the trial court’s granting of a direct verdict in favor of the unit owner on the claim for possession. The appellate court overturned the trial court’s decision and held that the Association provided sufficient evidence to establish that notice and demand had been sent to the unit owner. The court specifically found that nothing in the FED statute requires the Association introduce a physical copy of the demand sent. Oral testimony is sufficient to establish a prima facie case. However, the court noted, that the Association’s failure to introduce the demand itself, the condo declarations, and an itemization of the delinquency would have likely been fatal to its claim had the unit owner rested without presenting any evidence. The oral testimony would have only been sufficient to overcome the unit owner’s motion for a directed verdict.

Franklin American Mortg. Co. V. 7306 North Winchester Condominium Ass’n, 2016 IL App (1st) 140666-U In this case a mortgagee purchased a condominium unit at a judicial foreclosure sale. The mortgagee failed to pay monthly assessment fees following the transfer of title. After several months a third party bought the property from the mortgagee. The third party attempted unsuccessfully, to obtain an assessment letter from the Association. The Association claimed its lien for unpaid assessments had not been extinguished because the mortgagee failed to comply with section 9(g)(3) of the Illinois Condominium Property Act (“the Act”). The third party purchaser brought a rule to show cause against the Association for failure to produce an assessment letter. The trial court held the Association’s lien had been extinguished by the judicial foreclosure sale and that the Association was not entitled to past due assessments under 9(g)(4) of the Act. The appellate court reversed and remanded the ruling holding that the Association’s lien had not been extinguished. In support the court relied on 1010 Lake Shore Ass’n v. Deutsche Bank National Trust Co., 2015 IL 118372 (an association’s lien is not extinguished until a mortgagee both names the association in the foreclosure sale and pursuant to (9)(g)(3) of the Act, pays assessments as they become due after it acquires title). The court found that the mortgagee had failed to make any assessment payments after acquiring title and therefore the lien was never extinguished. Y

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01.17

CONDO LIFESTYLES

industry happenings

Associa Chicagoland

Associa Chicagoland is proud to announce its selection of Derek Wilkinson to serve as vice president of the city office in downtown Chicago. He will be responsible for directing management operations, client relations, training, and business development for the largest of Associa Chicagolands’s three offices. The other two are in Plainfield and Schaumburg. “We’re excited to welcome Derek to the Associa family. He is an industry veteran familiar with the area and the needs of our clients,” says Associa Chicagoland President Stephanie Skelley. “He has a background in property management and finance which will be perfectly suited for this leadership role at the city office. I also want to congratulate Joseph Schutzius who has been promoted from community manager to regional director and will be working closely with Derek and our city team.”

IREM Chicago

Wilkinson began his property management career in 2001 managing residential apartment portfolios in Normal and Champaign-Urbana for eight years. After moving to the Chicago area, he worked for two other major condominium management companies where he enjoyed much success before joining Associa Chicagoland in November Y Derek Wilkinson of 2016. He has earned his Certified Manager of Community Associations (CMCA) designation from Community Associations Institute (CAI) and is a graduate of Illinois State University with a Bachelor of Science in Business Administration.

Inland Bank

Inland Bank and Trust (“Inland Bank”) recently announced that Timothy J. Haviland joined Inland Bank in August of 2016 as senior vice president of commercial lending and community association financial services program. Mr. Haviland has over 20 Y Timothy J. Haviland years of experience in commercial lending and has been involved in community association banking since 2003. Mr. Haviland is wellknown and active in various industry groups including the Community Associations Institute (CAI), Institute of Real Estate Management (IREM) and ACTHA. He served on the board of directors for the CAI Illinois chapter from 2009-2015 and as President during 2012.

Shown here (from L to R) are 2017 Officers of IREM Chicago Chapter #23: Angela Aeschliman, CPM – Missner Group, Jim Vocos, CPM – Envision Real Estate & Management, Kris Haskins, CPM – Colliers, Shruti Kumar, CPM – Draper & Kramer, Elaine Finley, ARM – Urban Innovations and Teri Lind, IREM Chicago. IREM Chciago will hold its annual Premier Awards on March 3, 2017 at the Drake Hotel, Chicago. For more information visit: www.iremchicago.org

CONDO LIFESTYLES

Y Shown here are last year's winners of the IREM Chicago Premier awards.

01.17

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INDUSTRY HAPPENINGS

Draper and Kramer, Inc.

Full-service national real estate firm Draper and Kramer, Incorporated recently announced it has promoted Ian Novak, CPM, PCAM, to the position of vice president, director of condominium manage- Y Ian Novack ment services. Additionally, the firm has appointed Jay Howell, director of operations for Draper and Kramer, to also serve as operations manager for its condominium management services group. “It’s a real testament to the depth and track record of Draper and Kramer’s residential management group that we had two ideal internal candidates to tap for these leadership roles,” said Julie Johnson, senior vice president and director of management services for Chicago-based Draper and Kramer. “It’s a busy and exciting time for this division, especially with several recent additions to our management portfolio in the last few months. We’re proud to have such a great team in place as we build on our reputation as one of the top management firms in the country.” A nine-year veteran of the condominium property management industry, Novak brings substantial hands-on expertise to his new position, having managed and supervised an array of condominiums ranging from 25 to 450 units and totaling approximately 2,600 residences.

Having joined Draper and Kramer in 2008 as a property manager and property supervisor, Novak most recently served as vice president in the residential management division. As director of condominium services, management Novak’s responsibilities will include developing new business, focusing on board Y Jay Howell relations and ensuring compliance with condo law and practices. Novak is a graduate of Webster University in St. Louis and is a member of the Institute of Real Estate Management. “Ian brings a great combination of practical property experience and managerial acumen to this position, which will serve him well as he guides the team managing our portfolio of associations and properties,” said Johnson. “And thanks to his tenure with Draper and Kramer, he’ll be able to hit the ground running in this leadership role.”

As operations manager for condominium management services, Howell will support Novak and his team in the areas of operations and accounting. Howell will also continue to serve as director of operations for Draper and Kramer, a position he has held since 2014. A 12-year industry veteran, Howell joined Draper and Kramer in 2005 in the residential management division. “We’re fortunate to have Jay available as such a knowledgeable resource for our team, particularly with the latest additions to our condominium management portfolio. Here in Chicago, we recently took over management of The Manhattan, a 104-unit condo association at 431 S. Dearborn St., and The Marquee Condo Association, a 208-unit association at 1464 S. Michigan Ave.,” said Johnson. “We’re continually seeking out new efficiencies in our processes, and Jay’s in-depth expertise in this industry will be extremely valuable. One of the largest property management firms in Chicago, Draper and Kramer has a residential management portfolio of more than 10,000 rental units across Chicago, St. Louis, San Antonio and Minneapolis, as well as 25,000 condominium residences throughout Chicago.

Cukierski & Cochrane, LLC

Two leading CPA Firms specializing in the CIRA Industry, Cukierski & Kowal, LLC and Michael J. Cochrane & Associates recently announced that they have combined their firms effective January 1, 2017. The new firm will conduct their business as Cukierski & Cochrane, LLC. Both firms began their respective practices in 1981 and are extremely proud of their staff, their work product, their quality of advice, counseling and service. Clients can expect the same from the combined firm and the same team that they have come to know over the years. Gerry Cukierski will continue as managing partner of the new firm which will be providing audit and tax services (and an array of other related services) to over 1,100 associations with a staff of 20 accounting professionals.

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01.17

CONDO LIFESTYLES

industry happenings

Popular Association Banking

Popular Association Banking1 (PAB) is pleased to announce that Marty Klauber has just rejoined the Division as Vice President to assist Community Associations with their financing needs. Marty will be covering Illinois, as well as other Midwest territories (including Wisconsin, Missouri, and Minnesota). Marty has a strong background in finance, having received his MBA in Finance from the University of Wisconsin. Leveraging 35+ years in the finance arena, and 25 years specializing in commercial and community association lending, Marty joins PAB with a wealth of industry experience. Most recently, Marty was SVP/Association Banking Manager at another bank, and decided that representing PAB would be the best way to provide financial assistance to community associations in his region.

Advocate Property Management Advocate Property Management has completed its acquisition and integration of Lang Property Management and Consulting, Inc. The company will operate as Advocate Property Management, with locations in Naperville, Lisle and Tinley Park. The combined company employs 28 people, including 12 licensed managers, managing nearly

PAB serves the community association industry exclusively, and can accommodate all of your association’s financing, lockbox and depository needs. Highlights of PAB's lending program include long-term fixed rate financing up to 15 years, and custom-tailored loans to fit your association’s needs. In addition, your deposits are eligible for multi-million dollar FDIC insurance. 1

Y Marty Klauber

Popular Association Banking, is a division of Banco Popular North America. Member FDIC.

Lieberman Management Services

In a ceremony held on December 1, 2016 in SchaumIll., Lieberman burg, Management Services (LMS) was presented with the Better Business Bureau’s (BBB) 2016 Torch Award for Chicago and Northern Illi- Y Hosea Sanders and Carla Young Kennedy nois. The Torch Award for Ethical Commerce is BBB’s highest recognition given annually to businesses in Chicago and Northern Illinois that display the highest of ethical business practices.

TV personality Hosea Sanders, of ABC-7, presented the award to LMS’s Chief Executive Officer, Carla Young Kennedy. LMS’s executive staff was invited to attend the award presentation and scholarship luncheon. Paralympic Medalist, Iraqi Military Hero, leader, and motivational speaker Melissa Stockwell was the keynote speaker at the presentation.

10,000 association units in the greater Chicago Suburbs. The announcement was made by Advocate president Daniel J. Haumann.

Y Daniel J. Haumann

The Torch Award not only symbolizes the importance of ethical business practices, it spotlights businesses that intentionally pursue the highest standards of integrity with employees and customers to build marketplace trust. A panel of business leaders separate from the BBB chooses the winners from hundreds of applications each year. “The BBB’s mission of advancing marketplace trust is aligned with Lieberman’s mission, and helps our organization,” said Kennedy. “Our commitment to acting honestly, ethically, and with integrity is critical to our continued success. How we conduct our business and how we treat others - our colleagues, clients, customers, suppliers, and vendors will determine how the market views Lieberman.” "The Torch Award is the premier award the BBB can present to a company," says Steve J. Bernas, President and CEO of the Better Business Bureau serving Chicago and Northern Illinois. "Torch Award winners demonstrate the highest ethical standards of trust and behavior toward customers, business partners, shareholders, employees, and the communities in which they do business." Lieberman Management Services, a full-service property management company, has been serving community associations, high-rises and co-ops since 1971. Based in Elk Grove, Ill., Lieberman currently serves more than 40,000 residents and more than 220 associations in downtown Chicago and the greater Chicagoland area.

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01.17

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INDUSTRY HAPPENINGS

ABOMA

MCD Pool Party featuring Condolympics

The Apartment Building Owners and Managers Association of Illinois held their 79th annual meeting and holiday party on December 2, 2016 and elected as Officers: President, Tony Briskovic, Chicagoland Community Management, Inc., 1st Vice President, Sheila Byrne, The Habitat Company, 2nd Vice President Dean Lerner, Sudler Property Management, Treasurer, John Bieg, Draper and Kramer, and Secretary, Robert Wiggs ABOMA The group announced Directors elected for 3-year term of office: John Bieg, Draper and Kramer, Robert Graf, Sudler Property Management, Douglas Woodworth, Mulford Square Preservation Corp., Lex McCarthy, RMK Management Company, Shruti Kurmar, Draper and Kramer, Tairre Sutton, Tairre Management Services and William O'Leary, Community Specialists. Elected for a 1 year term of office was: Milena Radjenovich, Chicagoland Community Management, Inc..

Y Outgoing President of ABOMA Christine Friend is recognized by incoming ABOMA President Tony Briskovic.

The MCD Pool Party featuring Condolympics will be held on March 10, 2017 at the Pyramid Club in Addison.

ABOMA also announced their schedule of events for 2017:

Join over 300 attendees that are involved in the community association industry for a fun filled afternoon that features a food buffet, games a special raffle that benefits Special Olympics Illinois. For more information visit www.condolifestyles.net or call 630-932-5551

• Managers Night Out, early evening function at Athena Restaurant, Greek Town, Thursday, March 16, 2017 • Educational Seminar, afternoon function with networking, East Bank Club, Thursday, June 22, 2017 • SPECIAL EVENT, early evening function at Chicago Sports Museum, September 14, 2017 • 80th Annual Meeting, noon function, University Club of Chicago, Friday, December 1st, 2017

industry happenings Y Shown here is a group from Chicagoland Community Management

For more information visit www.aboma.com

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01.17

CONDO LIFESTYLES

From the Editor

e had three weekends in a row of snow and cold just

as the holiday season began, but things were somewhat mild over the actual holiday dates. We have had

CondoLifestyles

a few brief bitter cold periods in early January and of course, we still have plenty ®

Y Mike Davids

of Winter left so we’ll undoubtedly see some more snow and cold. Hopefully you enjoyed the holidays and are refreshed and refocused on getting your association(s) off to a good start in 2017. Economic conditions have continued to improve in 2016 and many are optimistic about 2017. Experts

januaRy 2017 | volume 20 | numbeR 4

predict that housing prices should continue to rise, although not at the level of 2016. While most everyone enjoyed low prices for gasoline, prognosticators say gas prices will increase significantly in 2017. The stock

editor & Publisher Michael C. Davids vice President Sherri Iandolo art Director Rick Dykhuis Special events Coordinator Mary Knoll Contributing Writers Pamela Dittmer McKuen, Jim Fizzell, David Mack, and Cathy Walker Circulation Arlene Wold administration Cindy Jacob and Carol Iandolo

market gains of late 2016 are encouraging and will hopefully continue throughout the year. Our cover story is a report on our “Condo Lifestyles State of the Industry” (SOI) program held in December at The Chicago Cultural Center. Attorney Gabriella Comstock gave a presentation on recent legislative and legal update for attendees. An expert panel consisting of two attorneys, two architect/engineers and two leading property managers shared their perspectives on current hot topics such as board communication (Palm II), short-term rentals, property tax appeals, RFP’s, service animals, riser replacements, business relationships, technology and life safety inspections at the SOI event as well. Our cover story features the highlights of the information shared by our expert panel at the SOI program. Our second story provides an overview and summary presented by Ms. Comstock of new laws and several court cases that directly impact community associations with an emphasis on laws and court rulings regarding board communication, emergency decisions at meetings, budget notices and amendments to declarations and by-laws. We have included her summary of all the recent legislation and court cases that you should be aware of as a separate article in this issue (some of which were not discussed at the SOI program).

Condo Lifestyles magazine is published quarterly by mCD media, a wholly owned subsidiary mCD marketing associates, Inc. For editorial, advertising and subscription information contact: 935 Curtiss Street, Suite 1a, Downers Grove, Il 60515. 630-932-5551 or 630-202-3006. Circulation: Condo Lifestyles is available for a single issue price of $8.95 or at a $30.00 annual subscription. Distribution is direct mailing and delivery direct through authorized distributors to over 5,000 officers and directors of Common Interest Communities, 800 property managers, 400 realtors, 400 developers and 400 public officials. Total Circulation is 9,500. Condo Lifestyles attempts to provide its readership with a wide range of information on community associations, and when appropriate, differing opinions on community association issues.

Additional coverage of our annual SOI event is also featured in this edition including photo highlights. You can also view all the event photos from this event at Facebook.com/mcd media. An article on the growing importance of technology capabilities and connectivity at CA buildings by Chris Smith offers some great examples on how to meet the technology needs of your residents. Two articles providing further information on legal topics of property tax appeals and short-term rentals can also be found in this issue. Our regular Industry Happenings column also appears in this edition as is customary. MCD Pool Party to feature Condolympics Games Our annual MCD Pool Party will be held on March 10, 2017 at The Pyramid Club in Addison. Tournaments will be held for 8-ball (billiards) and darts. Other events for Condolympics competition will also be held at the MCD Pool Party. The Condo Lifestyles Condolympics donations will benefit Special Olympics. Other upcoming MCD special events include our annual golf outing, which will be held on July 14 at Eaglewood Resort in Itasca, and a luncheon at Arlington International Racecourse in late summer. We will provide more information on these events as you request and as details are available at www.condolifestyles.net.

All material herein is copyrighted 2017. No part of the publication may be reproduced whatsoever without written consent from the publisher. This publication is designed to provide accurate and authoritative information in regard to the subject matter covered. It is issued with the understanding that the publisher is not engaged in rendering legal or accounting services. If legal advice is required, services should be sought.

Thanks to the many new subscribers that have found our publication useful and informative. Special thanks to the firms, associations and groups that are Authorized Distributors of Condo Lifestyles. Those of you who are not current subscribers can obtain subscription information on our website www.condolifestyles.net or by contacting our office. As we welcome in another new year, we encourage you to make your association and your community all it can be. If you have an idea that would benefit other Community Associations, a story to share, or some advice on how to avoid a problem or failure, please call our office at 630-932-5551 or send us an e-mail

advertisers assume liability for all content of advertisements printed, and also assume personal liability for any claims arising therefrom against the publisher relating to advertising content. The publisher and editors reserve the right to reject advertising or editorial deemed inappropriate for the publication.

CONDO LIFESTYLES

(mdavids@condolifestyles.net) Y

Michael C. Davids Editor and publisher

01.17

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CONDO LIFESTYLES

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Masonry and Concrete Restoration www.bralrestoration.com

HOLTON BROTHERS, INC. Masonry Repair Services, Tuckpointing, Caulking and Concrete Restoration John@holtonbrothers.com www.holtonbrothers.com

LS CONTRACTING GROUP, INC. T (773) 279-1122 F (773) 279-1133 Contact: Tom Laird tlaird@lscontrtacting.com www.lscontracting.com

Commercial Lending and Community Association Loan Program Contact: Timothy J. Haviland, CMCA www.inlandbank.com

ITASCA BANK & TRUST (630) 773-0350

HOA Banking • Internet Cash Management HOA Loans • Online Payment Services www.mutualofomahabank.com

CONDO LIFESTYLES

Simplifying Vertical Transportation Contact: Max Molinaro www.suburbanelevator.com

DRF TRUSTED PROPERTY SOLUTIONS (630) 615-7000

A Total Exterior Facade Restoration Company www.RiggioBoron.net

W. J. MCGUIRE COMPANY (847) 272-3330

HEATING, LIGHTING & WATER EFFICIENCY ASSESSMENTS

• Boiler tune-up and maintenance • All-Inclusive Design-Build Service • Maximum rebate capture • Guaranteed Savings www.DRFtps.com/rcs

Tuckpointing, Caulking, Masonry and Concrete Restoration

ENERGY SOLUTIONS CONCRETE RAISING

austinwerner@therealsealllc.com

Tuckpointing ~ Masonry Repairs Waterproofing ~ Terra Cotta Repairs Caulking & Sealants ~ Structual Repairs Cleaning ~ Balcony Restoration Concrete Restoration www.dakotaevans.com

SUBURBAN ELEVATOR CO. (847) 743-6200

RIGGIO/BORON LTD. (847) 531-5700

THE REAL SEAL, LLC (847) 756-7987

DAKOTA EVANS RESTORATION, INC. (847) 439-5367

www.smartelevatorsco.com smartin@smartelevatorsco.com

ENERGY EFFICIENCY

BASEMENT WATERPROOFING

BUILDING RESTORATIONS

SMART ELEVATORS CO. (630) 544-6829

QUALITY RESTORATIONS (630) 595-0990

“Together We’ll Shape the Future” www.itascabank.com

MUTUAL OF OMAHA BANK (866) 800-4656

ELEVATORS/CONSULTANTS

(847) 253-3886 TEL / (847) 253-3255 FAX

Loans, Reserve Investments & Lock Box Services www.communityadvantage.com

INLAND BANK & TRUST (630) 908-6708

Window and Related Masonry Interior & Exterior Doors | Siding & Gutters www.woodlandwindows.com

CENTERPOINT ENERGY SOLUTIONS (630) 795-2594

CRC CONCRETE RAISING & REPAIR (847) 336-3400 We Save Concrete, You Save Money! www.SaveConcrete.com

CREDIT BUREAU REPORTING

Natural Gas & Electric Energy Reliable Service. People You Trust. Contact: Vickie Farina Vickie.Farina@centerpointenergy.com www.CenterPointEnergy.com/CES

SPERLONGA DATA & ANALYTICS (952) 500-1068 j.starks@sperlongadata.com www.sperlongadata.com

01.17

For Display or Professional Services Directory Advertising Info, Call (630) 202-3006

No part of the publication may be reproduced whatsoever without written consent from the publisher. All material herein is copyrighted 2017©.

SERVICE DIRECTORY

ENERGY USE/BENCHMARKING

FIRE SAFETY & PROTECTION

GOVERNING DOCUMENTS

WESTSIDE MECHANICAL GROUP (630) 618-0608 / (630) 369-6690

CONTECH MSI CO. (847) 483-3803

HOMEWISE DOCS (773) 936-3270

Fire Detection & Signaling Systems Fire Alarm Systems Chicago Life Safety Evaluation Solutions Security Systems/CCTV Card Access Systems www.contechco.com

Contact Karen Corral kcorral@homewisedocs.com www.homewisedocs.com

EMCOR SERVICES TEAM MECHANICAL FIRE PROTECTION DIVISION (847) 229-7600

AMS MECHANICAL SYSTEMS, INC. (800) 794-5033

www.emcortmi.com

24 Hour Service HVAC • Industrial Refrigeration Service/Maintenance • Systems Integration Energy Management • Electrical Process Piping • Plumbing www.amsmechanicalsystems.com

Serving the Tri-State Area Since 1970 Contact: Jackie Loftis * jloftis@wsmech.com www.wsmech.com

FACILITY MAINTENANCE SP+ FACILITY MAINTENANCE (773) 847-6942 Daily Cleaning Services / Power Sweeping and Washing Painting and General Repairs / Seasonal Services (Snow/Ice Removal) Parking Facility, Surface Lot, PedestrianPlaza, Large Venue or Commercial Retail Building.

Contact: Daniel W.Nicholson dnicholson@spplus.com www.spplus.com/FacilityMaintenance

NORTHERN ILLINOIS FIRE SPRINKLER ADVISORY BOARD (NIFSAB) (866) 2NIFSAB (866-264-3722)

FIRE/FLOOD RESTORATION

708-403-4468 www.firesprinklerassoc.org

BROUWER BROS. STEAMATIC (708) 396-1444

www.edwardsengineering.com

EMCOR SERVICES TEAM MECHANICAL (847) 229-7600

USA FIRE PROTECTION (224) 433-5724

PARAGON MECHANICAL, INC. (847) 321-9428

Fire alarm / Sprinkler systems Fire pumps / Fire extinguishers Backflow prevention Fire panel / Monitoring INSTALLATION | INSPECTION | TESTING | MAINTEnance

24/7 EMERGENCY SERVICE: (847) 816-0050

www.pmcomfort.com

www.genesisconstruction.com

RESPONSE TEAM1 (847) 891-2929

HVAC Refrigeration Boiler Services Sheet Metal Piping Building Automation Energy Management

Fire Alarm / Sprinkler Systems Fire Pumps / Extinguishers Fire Panel Monitoring Installation / Testing / Maintenance 24/7 Service: (630) 948-1200 www.simplexgrinnell.com

GENESIS CONSTRUCTION, INC. (847) 895-4422

J. C. RESTORATION, INC. (800) 956-8844

EDWARDS ENGINEERING, INC. (847) 364-8100

SIMPLEX GRINNELL (630) 948-1235

All types of environmental cleaning. www.BrouwerBrothers.com

HVAC

www.emcortmi.com

SERVICE | INSTALLATION | MAINTENANCE

www.usafireprotectioninc.com

www.responseteam1.com

GARBAGE CHUTE CLEANING THE RESTORATION GROUP, LLC (630) 870-0658 www.trgrestore.com

BROUWER BROS. STEAMATIC (708) 396-1444 All types of environmental cleaning. www.BrouwerBrothers.com

THE YMI GROUP, INC. (847) 258-4650 Mechanical - Plumbing Building Automation - Service www.theymigroup.com

FOR DISPLAY OR PROFESSIONAL SERVICES DIRECTORY ADVERTISING INFO, CALL (630) 202-3006 No part of the publication may be reproduced whatsoever without written consent from the publisher. All material herein is copyrighted 2017©.

01.17

CONDO LIFESTYLES

HVAC

LANDSCAPE CONTRACTORS

MAILBOXES

WESTSIDE MECHANICAL GROUP (630) 618-0608 / (630) 369-6690

ALAN HORTICULTURAL ENTERPRISES, INC. (630) 739-0205

MAILBOX WORKS (630) 355-9989/(773) 528-3111

Serving the Tri-State Area Since 1970 Contact: Jackie Loftis * jloftis@wsmech.com www.wsmech.com

www.alanhorticultural.com

H V A C CLEANING

Large Variety of Commercial and Residential Mailboxes Intercoms and Tele-Entry Address Signage & Engraved Nameplates Installation Services Since 1989

BALANCED ENVIRONMENTS, INC. (847) 395-7120 | (630) 916-8830

www.MailboxWorks.com

NON PROFIT/EDUCATION

www.BalancedEnvironmentsInc.com

BROUWER BROS. STEAMATIC (708) 396-1444

ABOMA (312) 902-2266

ILT VIGNOCCHI (847) 487-5200

All types of environmental cleaning. www.BrouwerBrothers.com

ABOMA1@aol.com www.aboma.com

www.iltvignocchi.com

INSURANCE

ACTHA (312) 987-1906

LANDSCAPE CONCEPTS MANAGEMENT, INC. (847) 223-3800

HOLLINGER SERVICES, INC. (847) 437-2184

Association of Condominium, Townhouse and Homeowners Associations

actha@actha.org | www.actha.org

www.landscapeconcepts.com

Property Casualty • Employee Benefits Workers Compensation www.HollingerInsurance.com

COMMUNITY ASSOCIATION INSTITUTE OF ILLINOIS (847) 301-7505

SEBERT LANDSCAPING, INC. (630) 497-1000 ALLIANT/MESIROW INSURANCE SERVICES (312) 595-8135

www.sebert.com

Nancy Ayers www.condorisk.com

SEMMER LANDSCAPE (708) 926-2304

info@cai-illinois.org | www.cai-illinois.org

PAINTERS AAA PAINTING CONTRACTORS, INC. (630) 231-8350

gsemmer@semmerlandscape.com

INTERNET TECHNOLOGY

www.aaapaintco.com

LAWN CARE

XFINITY COMMUNITIES 1 (800) XFINITY

ABC DECO (773) 701-1143

SPRING-GREEN LAWN CARE (800) 830-5914

For more information E-mail: xfinity_communities@cable.comcast.com www.comcast.com/xfinitycommunities

info@abcdecoonline.com www.abcdecoonline.com

www.spring-green.com

ZOOM CONNECTS (844) YOU-ZOOM

ABBOTT PAINTING, INC. (312) 636-8400 (773) 725-9800

LOCKSMITH

Internet That Just Works www.zoomconnects.com

NONSTOP LOCKSMITH (312) 929-2230

LANDSCAPE CONTRACTORS

Locksmith Services, Intercom & Access Control Systems, CCTV, Overhead Garage Doors www.nonstoplocksmith.com

Quality Painting & Decorating since 1973 Our Mission: Guaranteed Committment to Quality Now offering Parking Lot Painting www.Abbottpainting.com

ACRES GROUP (888) 231-1300 / (847) 526-4554 Professional Landscaping and Snow Removal www.acresgroup.com 24

CONDO LIFESTYLES

For Display or Professional Services Directory Advertising Info, Call (630) 202-3006

01.17

No part of the publication may be reproduced whatsoever without written consent from the publisher. All material herein is copyrighted 2017©.

SERVICE DIRECTORY

PAINTERS

PEST CONTROL

PROPERTY MANAGEMENT

CERTAPRO PAINTERS OF THE NORTH SHORE (847) 989-4791

SMITHEREEN PEST MANAGEMENT SERVICES (847) 647-0010 / (800) 336-3500

CHICAGO PROPERTY SERVICES, INC. (312) 455-0107 X102

Interior & Exterior Painting Wallcoverings • Decorating • Remodeling Drywall Repair • Decks & Staining Tile Installation • Metal & Iron Painting www.certacommercial.com rmuldoon@certapro.com

www.smithereen.com

www.chicagopropertyservices.com

MORE LIVING. LESS WORRYING.

PLUMBING

HOMETOWN PAINTERS, INC. (847) 870-1600 www.hometownpainters.com

PRECISION PAINTING AND DECORATING CORP. (630) 688-9423 www.ppdpainting.com

LIFELINE PLUMBING (847) 468-0069

COMMUNITY SPECIALISTS (312) 337-8691

Plumbing - Heating & Air Conditioning Water Heaters - Sewer Cleaning & Repair Hot Water Drain Jetting www.INEEDLIFELINE.com

www.communityspecialists.net

PROPERTY MANAGEMENT

DRAPER AND KRAMER INC. (312) 346-8600 Contact Ian Novak

www.draperandkramer.com

ACM COMMUNITY MANAGEMENT (630) 620-1133 Contact Tom Skweres

www.acmweb.com

THE HABITAT COMPANY (312) 527-5400 Contact Diane White

PARKING GARAGE CLEANING

www.habitat.com

ADVOCATE PROPERTY MANAGEMENT (630) 748-8310

SP+ (773) 847-6942 dnicholson@spplus.com www.spplus.com/facilityMaintenance

FIRST COMMUNITY MANAGEMENT (312) 829-8900

Managing in the Chicago Suburbs since 1988 www.advocatepm.com

Guiding board members since 1988 www.condomanagement.com

PAVING ALMA PROPERTY MANAGEMENT (847) 517-4400

DUBOIS PAVING CO. (847) 634-6089 (800) 884-4728

FIRSTSERVICE RESIDENTIAL (312) 335-1950

www.almapropertymanagement.com

www.duboispaving.com

Contact Asa Sherwood

www.fsresidential.com

SP+ (773) 847-6942

ASSOCIA CHICAGOLAND (312) 944-2611 / (847) 490-3833

dnicholson@spplus.com www.spplus.com/facilityMaintenance

www.associachicagoland.com

G&D PROPERTY MANAGEMENT (630) 812-6400 www.gd-pm.com

BAUM PROPERTY MANAGEMENT, LTD. (630) 897-0500

PEST CONTROL ALL-OVER PEST SOLUTIONS (773) 697-1100

HILLCREST MANAGEMENT (630) 627-3303 / (312) 379-0692

www.BaumProp.com

www.hillcrestmgmt.com

Bed Bug Specialists. Results Guaranteed! www.all-overpest.com

CHICAGOLAND COMMUNITY MANAGEMENT (312) 729-1300

For Display or Professional Services Directory Advertising Info, Call (630) 202-3006

www.chicagoland-inc.com

No part of the publication may be reproduced whatsoever without written consent from the publisher. All material herein is copyrighted 2017©.

LIEBERMAN MANAGEMENT SERVICES (847) 459-0000 www.liebermanmanagement.com

01.17

CONDO LIFESTYLES

PROPERTY MANAGEMENT

RAILING INSTALLATION

ROOFING

KANE PROPERTY MANAGEMENT CORP. (773) 472-2300

FORUM GROUP 773-871-0212

ACTIVE ROOFING CO., INC. (773) 238-0338/(708) 430-8080

KaneManagement.com

Established 1965 Maintenance & Repairs Roofing/Sheet Metal/Tuckpointing www.activeroofing.com

Installation of aluminum railings

Professional Property Management. Affordable Rate. Contact: Dennis R. Kane; DKane@KanePM.com

REAL ESTATE TAX ATTORNEY

MCGILL MANAGEMENT, INC. (847) 259-1331

ELLIOTT & ASSOCIATES (847) 298-8300

www.mcgillmanagement.com

www.elliottlaw.com

NIMROD REALTY GROUP, INC. (847) 724-7850

KSN TAX (847) 537-0500

www.nimrodrealty.com

www.KSNLaw.com

ALL AMERICAN EXTERIOR SOLUTIONS (847) 438-4131

PROPERTY SPECIALISTS INC. (847) 806-6121

MCCRACKEN MCCRACKEN BEHRENS (312) 263-4308

Roofing, Siding & Windows www.aaexs.com

ROLLING MEADOWS OFFICE

Concentrating in Property Tax Appeals since 1976

(630) 633-5450

www.mmbtaxlaw.com

ADAMS ROOFING PROFESSIONALS INC. (847) 364-7663 Roofing / Siding / Gutters / Insulation www.adamsroofing.com

WOODRIDGE OFFICE

AMERICAN BUILDING CONTRACTORS, INC. (847) 670-1887

www.psimanagement.net

REALTY & MORTGAGE CO.

WORSEK & VIHON LLP (312) 368-0091

COMMUNITY ASSOCIATION MANAGEMENT

www.wvproptax.com

Roofing • Siding • Windows • Gutters Maintenance • Capital Budget Projects A+ BBB Rating www.abc-usa.com

773-989-8000 1509 W Berwyn Chicago IL 60640 Contact: Hugh Rider www.RealtyMortgageCo.com

RESERVE STUDIES RESERVE ADVISORS, INC.

TAIRRE MANAGEMENT SERVICES (847) 299-5740 tsutton@tairremgmt.com

SUDLER PROPERTY MANAGEMENT (312) 751-0900 www.sudlerchicago.com

WERK MANAGEMENT (630) 241-0001

Our Reserve Studies Now Include ForeSite™

(312) 625-4958

www.lakeroof.com

Custom, Comprehensive Studies Conducted by Professional Engineers www.reserveadvisors.com Long-term Thinking. Everyday Commitment.

CSR ROOFING CONTRACTORS (708) 848-9119

SUPERIOR RESERVE ENGINEERING & CONSULTING (888) 688-4560 www.superiorreserve.com

For All Your Property Needs www.werkmanagement.com

B.T. LAKESIDE ROOFING (630) 628-0093

All Types of Roofing Installation, Repairs & Maintenance www.csr-roofing.com

D-WING CONSTRUCTION (630) 397-8889 Your Home, Our Reputation A+ BBB Rating www.DWingConstruction.com

FOR DISPLAY OR PROFESSIONAL SERVICES DIRECTORY ADVERTISING INFO, CALL (630) 202-3006 26

CONDO LIFESTYLES

01.17

No part of the publication may be reproduced whatsoever without written consent from the publisher. All material herein is copyrighted 2017©.

SERVICE DIRECTORY

ROOFING

SNOW REMOVAL

SIDING / RENOVATIONS

MI CONSTRUCTION AND ROOFING (630) 241-0001

THE WINTER WERKS (630) 241-0001

WOODLAND WINDOWS & DOORS (630) 529-DOOR (3667)

www.mancioneinc.com

PROHTOP ROOFING (847) 559-9119 We’re Here When You Need Us! www.protoproofing.com

TRICON SNOW CONTROL, INC. (847) 410-2846

S&D ROOFING SERVICE (630) 279-6600 250,000 roofs installed since 1963 TEAR OFFS • SHINGLES • FLAT Multi-Family ROOFING Specialist Our experience & technical know-how gets the job done right the first time! www.sdroofing.com sales@sdroofing.com

TV-BULK CABLE & SATELLITE

www.triconsnow.com

ACCESS MEDIA3 630-230-0555

SWIMMING POOLS

M&T EXTERIORS INC. (331) 248-0447 Roofing Siding Windows and Service. www.mt-exteriors.com

Window and Related Masonry Interior & Exterior Doors | Siding & Gutters www.woodlandwindows.com

www.accessmedia3.com

SPMS (630) 692-1500 Heaters Pumps • Repairs • Chemicals Pool Maintenance • Complete Water Analysis Pool Guards, Inc. ross@spmspools.com

TREE CARE ACRES GROUP (888) 231-1300 / (847) 526-4554

SITE MAINTENANCE, INC. (847) 697-1077 www.sitemaintinc.com

SECURITY SERVICES ADMIRAL SECURITY DOOR STAFF SOLUTIONS (847) 588-0888 www.admiralsecuritychicago.com

U S SECURITY SERVICES (877) 340-1835 Safe - Secure - Friendly ssiegel@ussecurityassociates.com www.ussecurityassociates.com

SNOW REMOVAL SP+ (773) 847-6942

Certified Arborists & Certified Tree Care Safety Professionals www.acresgroup.com

RCN (312) 955-2322 rcnchicagoapts@rcn.net www.rcn.com

XFINITY COMMUNITIES 1 (800) XFINITY For more information E-mail: xfinity_communities@cable.comcast.com www.comcast.com/xfinitycommunities

SIDING / RENOVATIONS

WASTE SERVICES

B.T. LAKESIDE ROOFING (630) 628-0093

LAKESHORE RECYCLING SYSTEMS (773) 685-8811

www.lakeroof.com

www.LakeshoreRecyclingSystems.com

D-WING CONSTRUCTION (630) 397-8889

WINDOWS/REPLACEMENTS D-WING CONSTRUCTION (630) 397-8889

Your Home, Our Reputation A+ BBB Rating www.DWingConstruction.com

INSIDE-OUT PAINTING CONSTRUCTION & ROOFING (630) 406-3000 www.insideoutcompany.com

Your Home, Our Reputation A+ BBB Rating www.DWingConstruction.com

WOODLAND WINDOWS & DOORS (630) 529-DOOR (3667) Window and Related Masonry Interior & Exterior Doors | Siding & Gutters www.woodlandwindows.com

PERFECT SIDING 773-732-3051 Installation of siding

dnicholson@spplus.com www.spplus.com/facilityMaintenance No part of the publication may be reproduced whatsoever without written consent from the publisher. All material herein is copyrighted 2017©.

01.17

CONDO LIFESTYLES

from page 5 The assessing officials are also working hard to figure out who is getting homeowners exemptions who shouldn’t be. They are not only pouring over information in this county, but they are looking in other places around the country to see if I have a home in Florida and I’m getting an exemption down there, so I’m not entitled to one here. They are clawing that money back, and they are clawing back millions of dollars. These penalties are really, really onerous. If you have other properties, make sure you don’t claim double and triple exemptions because it will come back to bite you. They are using technology effectively to do that.

State-of-the-Industry

Report

Most suburban areas, which levy higher taxes than Chicago, are not seeing the same pension funding crisis. Also, suburban schools are under tax caps. Q: How is technology impacting the tax appeal process? Elliott: Both good and bad. When I started doing business 25 years ago, we had to go from accounting office to accounting office to get information. It was in books, it was on microfiche, it was time-consuming. Now there are a lot of online resources you as property managers or property owners can avail yourselves of. The Cook County Property Tax Portal is one website that gets you access to almost everything. We as lawyers love it and use it, but we also hate it because assessing officials now have that same information. We file appeals and they use it against us. We come in and say a property is worth only $2 million, and they say, “Why did you get a $3 million mortgage two months ago?”

Q: Could you lend your advice on implementing capital improvement projects and finding quality contractors? Michael Bonick: It’s important to know what the association’s goals and priorities are and also which systems need improvement. Reserve studies are important, but remember they are just a guideline. Reserve studies define expected lifespans and repair and replacement costs, but a lot of them forecast out 20 or 30 or 40 years. These are buildings, and each one is different, and each one has some unforeseen condition. If the reserve study says you need $500,000 in 2030, as you get closer to the time, budget for it,

CONDO LIFESTYLES

01.17

but also do a more detailed analysis to determine the actual lifespan. Knowing contractors who specialize in your type of work is important, but if you don’t know who these people are, then know how to find them. Put together good RFP’s using a mechanical engineer or a structural engineer. Ask them for recommendations. Your property supervisors can also help. Q: What is the Chicago Home-Sharing Ordinance, and how does it serve associations? Margaret Shamberger: AirBNB, Home Away and other advertising platforms are in place to provide vacationers the opportunity to rent residential units for short-term stays. Associations are concerned because of security breaches caused by high-level transiency, and we want to get a handle on stopping it. The Home-Sharing Ordinance, which was adopted on June 22, 2016, provides protections to condominium, cooperatives and homeowner associations against short-term rentals. It requires intermediaries and advertising platforms to register with the city. Owners who wish to rent their units must register as well. As part of the process, owners have to attest there is no rule in place in their governing documents that prohibit shortterm rentals. continued on page 31

No part of the publication may be reproduced whatsoever without written consent from the publisher. All material herein is copyrighted 2017©.

No part of the publication may be reproduced whatsoever without written consent from the publisher.

01.17

CONDO LIFESTYLES

COVER STORY

from page 28

State-of-the-Industry

Report

Q: Can you offer any tips or tricks for how associations can deal with the issue of short-term rentals? Shamberger: First, make sure the language prohibiting short-term rentals in your governing documents is clear and concise. If no such language exists, work with your attorney to amend the declaration. Second, managers should place their properties on the “Prohibited Buildings List” of those where short-term rentals are not allowed. They need to check the websites on a regular basis. Look for individual units or photos that identify your properties. Let your boards know as soon as possible. Third, your staff are your eyes and ears. Develop a training program so they understand how to identify a short-term rental and what to do if they find one. Make the training program ongoing. Staff sometimes get lax or they like a particular resident, so they won’t say anything. Fourth, have a concise plan in writing, follow the plan and be aggressive about bringing owners to the board for hearings. We find that many times when owners are brought before the board for hearings, they may have rented their units 10 or 20 times. That unit owner has made a significant amount of revenue. The impact of the fine assessed by the association is a drop in the bucket. Finally, include the prohibited language in welcome packages or other documents given to potential buyers and renters before they move into the building. Giving advance notice will make your case that much stronger when you approach violators. Dakoff: We have been recommending stiffer and stiffer fines. At first, we recommended a few hundred dollard in fines and then $500, and we have been going up. If we see someone renting out their units multiple times, we have levied fines of $1,000 per night. There has to be a disincentive for them to do it. Cease-and-desist letters also are helpful. Dakoff said over the past two years his firm has sent out an increasing number of such letters and not a single owner is known to continue to lease. “Our nasty-gram definitely has a positive effect,” he said.

Q: Many associations are looking at riser replacement work. Why is this happening now, and how much does it cost? Lawrence Puder: Risers are essentially pipes that distribute hot and cold water within the various stories and individual units in a building. There are vertical risers and horizontal risers. The reason we are hearing a lot about this topic now is just like the human body, as they age, they tend to clog up. Most buildings from the 1950s, 1960s and 1970s used galvanized steel pipes, which wear away, erode, and develop pinholes and leaks, especially at the joints, which is where the pipe is the thinnest. Riser replacement can be an invasive project. You have to open the walls, tear out the pipes and replace them with new material. That’s why it gets to be so expensive. Warning signs include rusty water and diminished flow. Also, if you are spending more and more money on service calls to your plumber. We recommend ultrasound testing to determine the thickness of the pipe and the remaining life expectancy. If you are going to replace the pipes, involve an engineering firm to do the work. It is highly specialized. Also, involve the association’s attorney because there are issues of where the association’s responsibility starts and where the unit owner’s responsibility starts. The cost varies greatly depending on the building, how many tiers and how many stories. It can vary from $200,000 to $500,000 per riser, depending on how you approach the project. Usually, it’s a multi-year project. No one does an entire building in a single year or two or three, so you have time to plan and fund it. Q: What can you tell us about Chicago’s life-safety inspections? Are generators being required? Milena Radjenovich: Generators are not required yet for buildings built during the eras of 1950 to 1970, but they do have to comply with all lifesafety requirements to make sure the building can be safely evacuated in case of a disaster situation. A lot of codes are subject to interpretation, but all inspectors look for the obvious: exit pathways, door closers, fire-rated doors. Any pathway or opening a fire can travel through must be sealed.

No part of the publication may be reproduced whatsoever without written consent from the publisher. All material herein is copyrighted 2017©.

01.17

Q: Are you seeing an increase in animal service requests in your buildings? If so, to what do you attribute this? Radjenovich: We are. Everyone loves animals, and some people rely on animals for emotional support. What is happening is people are finding ways to circumvent the rules in non-pet buildings by declaring a need for a pet for emotional support. These days you can log onto the Internet and buy a “certification” for $100. What we are doing is advising associations to have these requests reviewed by counsel. The Fair Housing Act does allow animals, and we can’t discriminate. Associations do have the right to ask for certification from a doctor or psychiatrist. We also have to diligently try to work through any kind of abuse, but as long as a doctor or psychiatrist certified the need, we really can’t stop it. Q: In our relationship-based industry, how does a contractor or service provider go about building new business and maintaining it? Can RFP’s help? Ottis Ballenger: Events like State-of-the-Industry are an opportunity to solidify bonds across peers. Other things we do is sponsor great organizations like the Community Associations Institute. We advertise in trade journals such as Condo Lifestyles, serve on committees and participate in the educational programs. Participation in the community is what it ultimately comes down to. Another valuable way to stay tied to the industry is to occasionally step outside the realm of your office space and sponsor something outside that realm. For example, CertaPro has a program, Homes for Troops, which makes homes for military personnel who need a home. My philosophy on RFPs has changed. Years ago we preferred detailed RFPs with lots of information provided. It turns out the least amount of information you can give us is often the best. Talk about the need for conversation and relationshipbuilding: If you give us nothing, we’ll pester you to death until we have something to work with. That gives us the opportunity to collaborate and offer new ideas on what we think is best. Someone earlier asked me how to craft a really good RFP. My take is don’t craft one at all. Just give us a call and say you need something painted. Y

CONDO LIFESTYLES

State-of-the-Industry

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December 8, 2016 Chicagoland

Buildings Environments CondoLifestyles

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M A N A G E M E N T TA L K S

By Chris Smith, Vice President of Sales and Marketing, Comcast Greater Chicago Region

Connecting Residents Seamlessly to the Information Superhighway Multifamily developments are quickly becoming a top housing choice for all generations, according to the 2016 National Multifamily Housing Council’s (NMHC) 50 study. The number of renters has grown rapidly – with a stunning 9.6 million increase since 2004.

his figure is in line with a September 2016 CnbC report on a study that found homeownership rates among millennials are continuing to decline as they delay purchasing homes. millennials also are moving from the suburbs to cities like Chicago in increasing numbers to take advantage of numerous career and lifestyle opportunities. Demand for condos and rental units is high, creating a great opportunity for property owners and developers. It also creates a unique challenge: how to keep current residents happy and, at the same time, ensure that new developments continue to meet market demands.

The Chicago Tribune recently reported that downtown and other Chicago area condo property developers are targeting the high end of the market, resulting in a building boom for new luxury high-rises that’s expected to continue into 2017. To be competitive and attract residents, these new developments will need to provide top-level amenities, such as high-speed internet, parking, walk-in closets, soundproofing and a patio or balcony.

Keeping current residents happy Investing in new amenities is a solid practice that will keep properties attractive

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and competitive, especially to millennials. a staggering 94 percent of the 120,000 respondents to the 2015 nmHC Renter Preferences study said that access to high-speed internet was the number one amenity they seek when looking for an apartment or condo. They also said that being within walking distance to grocery stores, restaurants, bars and public transit was extremely important to them. Technology and high-speed internet connections are definite must-haves for luxury condos in the Chicago area. In fact, the nmHC report found more than half of individuals looking for a residence have tested mobile and internet connectivity speeds during tours. Good cell phone reception and connectivity also are essential, which means that buildings should have strong wireless network and Wi-Fi connections in common areas, in addition to individual units. This trend isn’t

CONDO LIFESTYLES

that surprising. The u.S. has become “access heavy, meaning many americans expect internet connectivity wherever they go. Streaming videos, tablets, smartphones and telecommuting demand it, as does the rise of smart home technologies, ranging from connected lighting and cameras to appliances. “Residents value amenities and location among all else. offering a mix of community and individual-unit amenities are what differentiate our properties from others in the area. our residents want things like secure package delivery areas, parking, fitness centers, bike storage and on-site concierges, as well as stateof-the-art technology infrastructure throughout the building. Residents want access to the fastest Internet speeds available in the market – within their units and in public areas throughout the property,” added asa Sherwood, president, FirstService Residential in Illinois.

Planning for technology It’s critical to plan for network infrastructure during the design and development phase. Condo property owners and developers need to ponder what residents need now for

internet access and then multiply that exponentially to ensure the connection will meet future needs. They need to incorporate fiber infrastructure into their building plans to have a competitive advantage, offering residents options that simply may not be available at other developments. Residents will appreciate having the ability to access gigabit speeds in their units, especially given the increasing number of connected devices and smart home technologies they use. In fact, IHS Technology analysts recently reported that homes in north america have an average of 13 connected devices which can range from smartphones, laptops, smart appliances, smart Tvs, gaming consoles and more. additionally, condo buildings will also need high-speed internet access through the common area as resident expect free Wi-Fi wherever they go. For instance, Comcast is helping to fulfill this need by providing customers with access to its nearly one million Xfinity Wi-Fi hotspots in the Chicago area and about 15 million nationwide, so the amenities don’t end at the building’s front door. video streaming accounts for more than

50 percent of all internet usage. americans are actually watching more video on game console platforms, multimedia devices, DvRs and mobile phones than on traditional Tvs, according to a recent report published by marketing Charts. In 2016, 50 percent of u.S. households reported using streaming video services, up eight percent from 2015. This figure will only continue to rise as service providers wrap streaming video services into their offerings, as Comcast recently did by making netflix available on its X1 operating system. as such, these online services are part of a residents’ everyday life and are additional reasons why investing in infrastructure that scales quickly is important. Slow speeds or spotty service will frustrate residents and can damage the property’s reputation. “Technology infrastructure was part of Catalyst’s building design process from day one, because we knew how important it would be to our residents. We’ve installed fiber throughout the building, which will allow residents to increase their speeds as needed to handle all their requirements. It was essential for us to partner with a service provider that’s

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M A N A G E M E N T TA L K S

well established in our neighborhood and that offered a fiber-based high-speed internet solution and complementary products and services, along with white-glove customer service,” said jim Cunningham, chief operating officer, marquette Companies.

Customizing service Dedicated service provider customer service teams are important for every building. These “communication concierges” are available to educate residents about the internet and related services available in the building, as well as answer questions and help resolve issues when they arise. “our service partners are an extension of our property management team. So we require that anyone who interacts with our residents to be the best in the business,” said Karl Kulhanek, president, aCm Community management. access to high-speed internet service is extremely important in condo and multifamily properties. not only because 94 percent of residents say it’s their top priority, but because society is evolving from “asset heavy” to an “access heavy” with number of con-

Y Video streaming accounts for more than 50 percent of all internet usage. Online services are extremely important to residents and that's why it's so important to invest in infrastructure that scales quickly.

nected devices on the rise and demand for 24/7 internet connection. Residents expect reliable common area Wi-Fi and fast speeds to accommodate all of their connected devices, a number that will only continue to grow in the

next few years. Properties implement network infrastructures that can accommodate today’s and tomorrow’s technologies are the most likely to remain competitive over time and to satisfy their residents. Y

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By Timothy Jacobs, Kovtiz Shifrin Nesbit

ILLINOIS PROPERTY TAXES:

Why Pay More When You Can Appeal For Less As an Illinois property owner, it’s unlikely you have remained unaffected by the current state of property taxes. Whether you live in a single family home or in a condominium that is part of an association, here are four factors that may put your property tax assessment in perspective: 1. Illinois has the highest property taxes in the nation. a Corelogic study released in april 2016 revealed that Illinois has the highest property tax rate in the united States. by comparison, Hawaii has the lowest.

2. Illinois residents would leave the state due to high property taxes. In october 2016, a Paul Simon Public Policy Institute poll revealed that 47% of Illinois registered voters said they would leave the state if they could. Taxes were the number one reason.

3. Foreclosures continue to increase; property values stay the same or decrease. according to aTTom Data Solutions’ u.S. Residential Property vacancy and Zombie Foreclosure Report, nearly 1.4 million residential properties were vacant by the end of the third quarter in 2016. Illinois has the third highest amount of “zombie homes” or vacant foreclosures. at the city level, Chicago has the second highest amount of vacant properties owned by a lender, only second to Detroit. Stagnant home values and a poor housing market can make it harder to sell a home in Illinois.

4. Chicago residents are paying even higher property taxes. Shortfalls in the police and fire pension funds have forced the City of Chicago to increase tax bills. In 2016, the average Chicago homeowner paid an additional 13% in property taxes. and according to a november 2016 Tribune article, Chicago households will pay nearly $1700 more per year in 2017. additionally, a large number of Chicagoland homes will be reassessed in 2017 as part of the Cook County assessor’s office township triennial reassessment schedule. Homeowners in south suburbs such as oak Park, Homewood, and Tinley Park may be looking at substantial assessment increases. For example, northwest suburban homeowners saw property assessments increases between 15%-25% in 2016.

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L E G A L U P D AT E

The Appeal Process Explained

So What Can You Do About It?

assessment appeals start at the Cook County assessor’s office. Cook County affords taxpayers the ability to file formal complaint within 30 days of the township publishing the new assessment. The process is more informal in the Collar Counties at the assessor level. The local township assessors will discuss lowering the assessment at the taxpayer’s request when the assessments are published, but no actual appeal is filed. after the assessor decides the matter, taxpayers can next appeal their property tax assessment to the County board of Review. The board of Review appeal is more formal both in Cook and the Collar Counties. The board of Review has stricter appeal rules and will hold hearings on assessment appeals. When the board of Review issues a decision, the taxpayer can file a further appeal to either the Illinois Property Tax appeal board (PTab) or the Circuit Court of the County.

unlike other costs involved with owning property (ex. mortgage payment, utility bills), tax assessments can and should be appealed. While many counties have streamlined the ability to file an appeal, winning an appeal is a whole other matter. Successful appeals require concise and compelling evidence. moreover, filing deadlines can pass without notice to homeowners preventing them from even contesting their assessment. association assessment appeals require more careful analysis and preparation. They should be filed as a group on behalf of all units to streamline the process. This will benefit all unit owners and ensure uniformity of taxation within the association. County assessors prefer one appeal from associations for three main reasons: 1. It is administratively easier to process

one appeal as opposed to a multitude if each owner filed separately. 2. The County Assessors place a single value on the entire building or development and reviewing that value is facilitated by an appeal including all units.

3. The County Assessor has a duty to uniformly assess all units within an association. The group appeal enables the County Assessor to meet this obligation. The board of Review, Property Tax appeal board (PTab), and Court require condominium associations to be represented by licensed attorneys in an assessment appeal before their offices. Therefore, avoid hiring a “tax consultant” or having one of the members file an appeal on behalf of the entire association. This appeal would be voided and might cost the association the ability to re-file with legal counsel if the appeal deadline has expired.

Conclusion There are several Illinois agencies and levels in which to appeal your property tax assessment, each with its own caveats and pitfalls. accordingly, associations should seek out skilled legal counsel to steer them through this process. When you receive your 2017 property tax assessment notice, request that your board hire a competent attorney to represent the association in the appeal. Y

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CONDO LIFESTYLES

By: Nicholas Bartzen and Howard Dakoff, Levenfeld Pearlstein, LLC

ENFORCEMENT OF THE SHORT-TERM RENTAL ORDINANCE/Q&A The City of Chicago Department of Business Affairs and Consumer Protection (“BACP”) will begin enforcing the Shared Housing Ordinance (colloquially referred to as the "Airbnb Ordinance") as of mid-December, 2016, just in time for the holiday season. Any associations that have completed the affidavit to be included on the Prohibited Building List ("List") should thus be able to rely on the City enforcing the List shortly. The following are some questions that we anticipate many boards and associations residents may have regarding the City’s enforcement.

1. Our association is not included on the List, but we want to make sure we are not over-run with short-term renters. What can we do to ensure this doesn’t happen? First, we recommend that all associations in the City of Chicago submit an affidavit to be on the list if the board of directors has any concerns with short-term rentals in its building. Second, even if the board of a particular association does not want to be on the list for some reason, notwithstanding, the City has established clear caps on how many units within any building or association may be leased at any given time for shortterm or vacation rental in any case. In any

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L E G A L U P D AT E

building with five (5) or more units, only six (6) units or 25% (whichever is less) can be registered as host units at any given time. This effectively means that there should never be more than (6) six units operating as short-term or vacation rentals on any given night for most Chicago associations. The City will sees to it that no more host registrations for that particular building address are distributed until there is an opening. If it appears that more than six (6) units are being rented on any given night, most likely an individual is hosting without the proper registration and should be reported immediately to face a penalty. With only six (6) registered lessors within the building, the impact should be minimized to the association.

2. What can our association do about loud, obnoxious or disruptive shortterm renters? any individual who witnesses unseemly or objectionable conduct from short-term lessees or host / lessors should report the issue to the City, which will hopefully result in the City taking appropriate action against both the intermediary platform (airbnb) and the lessor. Individuals can report the complaint by calling 311 or by visiting the baCP website to file a formal complaint. The City will then determine whether a fine is appropriate or whether the lessor's registration should be revoked. The City also requires intermediary platforms like airbnb to have detailed provisions to deal with ill-behavior and egregious conduct by host / lessors and lessees (likely a suspension of the hosts right to list the unit on the platform).

own governing documents that prohibit noxious or offensive activity by issuing a violation directly to the unit owner and levying a reasonable fine (among other available remedies).

3. How many associations or buildings are included on the Prohibited Building List? as of early December 2016, the City of Chicago has reported that roughly 800 buildings representing roughly 60,000 units have submitted affidavits to be included on the list.

lastly, the association can always enforce its

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CONDO LIFESTYLES

(i.e. a board most likely cannot rely on a rule or regulation, or board resolution, to limit short-term or transient rental to stop individuals from listing their units on airbnb).

4. My association does not have a shortterm leasing restriction in its declaration or by-laws, yet the board has decided to file the affidavit to include the association on the List. What can happen as a result of this?

associations can only submit an affidavit for inclusion on the list if the leasing restrictions are enforceable. otherwise, the board members could be liable for a breach of their fiduciary duty for filing an inaccu-

Due to a February 2016 Illinois appellate case, restrictions regarding leasing must be in the Declaration and by-laws (versus rules and regulations) with few exceptions

rate affidavit. moreover, the City will maintain an appeals process for those individuals who believe their hosting activities have been wrongfully limited by their association. If an individual feels that the building filed the affidavit to be a part of the list without proper legal authority do so, then the City could have recourse against the association directly.

5. What happens once a complaint against a host or lessor is logged with the City of Chicago?

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The City of Chicago can take a number of measures when it receives a complaint about a short term rental host, which include but are not limited to, fining the individual, refusing to allow a renewal of said registration or simply revoking the hostâ&#x20AC;&#x2122;s registration.

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6. How can an individual or association confirm that a building is included on the prohibited building list? Can we confirm which unit owners are registered as lessor / hosts? The City has stated it will publish both lists by the end of December of 2016 on the baCP website.

7. Our association allows short-term rentals but owners report that they have been limited in their ability to list the unit on Airbnb or other sites? Why might that be? one possible scenario is that the association has pending building code violations. buildings with life safety or other potentially dangerous or life threatening building code violations will be limited in their ability to allow hosts or lessors to rent units on a short-term basis. Those building addresses will be flagged and any rental activity therein will be limited by the City of Chicago until the violations are remediated. Y

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