Troubled Colorado Springs condo complex in ‘world of hurt’ financially
By Bill Vogrin
20 February 2015
For years, the Sierra Pointe Condominiums complex has been "Exhibit A"
of the need for professional management and an informed homeowners
Built in 1974, the 282-unit complex on 13 acres near Austin Bluffs
Parkway and Academy Boulevard has long been plagued by controversy.
Sierra Pointe first surfaced in Side Streets in 2007 when an abusive
property manager was harassing owners. Then an audit discovered the
manager had deposited $13,000 in HOA dues in his private account, which
he eventually repaid.
Subsequent columns told of battling HOA boards and a property
management company that quit rather than deal with an abusive HOA
So it was no surprise when residents recently started contacting me,
claiming the complex was drowning in debt and in danger of going
roads through the Sierra Pointe Condominiums, seen Feb. 19, 2015. The
282-unit complex built in 1974 on 13 acres has been troubled in recent
years and now is in financial distress. Bill Vogrin / The Gazette
Longtime owner Patsy Cyphers, a former board member, was among those
sounding the alarm.
"Sierra Pointe is in a world of hurt," Patsy said. "Many residents are
up in arms. Roads, roofs, carports, balconies - they are in dire need
of repair. Nothing has been maintained.
"Then the HOA board wanted to raise $2 million through a special
assessment on owners. My share would have been $7,250. That's on top of
my monthly dues. When the special assessment got voted down, the HOA
board raised dues 30 percent."
Heather Smith, who manages Sierra Pointe for Warren Management Group,
confirmed things have been bad. In fact, she said, the complex's
finances are a disaster. Its problems are so well-known she couldn't
even find a local auditor willing to assess the damage. She had to hire
a Denver firm.
Record-keeping made it nearly impossible to trace income and spending.
The final report was ugly.
"We took over the property in October 2013," Smith said. "At the time,
the unpaid invoices from vendors were upwards of $300,000. We had
vendors who were waiting months on past-due payments."
Even worse, unpaid HOA dues stood at $280,000. Such a high percentage
of owners were behind on their dues that Sierra Pointe condos no longer
qualified for Federal Housing Administration loans, crippling owners'
ability to sell to first-time homebuyers.
Perhaps most startling was the balance in Sierra Pointe's reserve fund,
which should have been around $3 million, Smith said.
"They entered 2015 with just above $18,000 in reserve," she said.
neglect have created an expensive backlog of maintenance needs at The
Sierra Pointe Condominiums, seen Feb. 19, 2015. The 282-unit complex
built in 1974 on 13 acres has been troubled in recent years and now is
in financial distress. Bill Vogrin / The Gazette
It's so bad, the HOA board struggled recently to find $9,000 to
demolish a carport in danger of falling over, possibly crushing a car
But Smith said there is hope. Together, she and a new HOA board have
shaped a 10-year plan to rebuild its finances. Raising dues 30 percent
was a painful part of the solution.
"Monthly dues jumped $40 to $50 a month for owners," Smith said.
Monthly dues now range from $194 to $315, depending on each unit's
square footage. And utilities climbed 3 percent. That means some owners
are paying $515 a month in dues and utilities.
She said the board knows owners are suffering, but there was no choice.
The complex saw its insurance premiums jump 45 percent in two years
because its carrier assessed the risks and found exactly what Patsy
said: nothing has been maintained.
Smith said it will take discipline by the HOA board and owners to turn
it around. The needs are great. Five buildings are in urgent need of
roofs, which cost from $60,000 to $180,000, depending on size. Roads in
the complex need $100,000 in resurfacing. Several carports need to be
replaced at $45,000 apiece. Retaining walls are collapsing. The list
"We're happy with our progress," Smith said. "I do think there's hope
for Sierra Pointe."
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