Condo Foundations, Dreams Crumble

When Vanessa Brown moved into her condo in 1997, she hoped to pass her gorgeous 1,500 square-foot investment to her son one day — that is, until cracks started to form in her walls and foundation.

Brown still lives in her condo at the corner of Arch Street and Pine Rock Avenue in Hamden, in a small two-building complex called the Pine Rock Condos.

The dream that she will one day have a valuable condo to pass to the next generation has crumbled, like her foundation.

When she first moved in, she said, her condo was ​“absolutely gorgeous.”

Then she started to notice cracks in her walls.

At first, it was just one little crack, she said. It was there when she moved in, she said, but she didn’t think much of it until around 2013, when she started to notice more.

“They kept appearing. My basement floor started to crack. And I was getting water inside my basement,” she recalled.

She asked her neighbors, and her neighbors said they, too had cracks forming.

As she soon found out, the culprit was the faulty fill on which the condos were built.

Constructed in the 1980s, Pine Rock was a part of a condominium-building boom that swept across the nation. As studies determined in the 2000s, the developer had placed fill on the site where one of the buildings would be in order to elevate the ground and compensate for a natural slope. The fill the developer used, though, was not adequate. Supposedly, it included organic materials like tree trunks, which over the course of decades decomposed and compacted.

Somehow, the shoddy fill slipped the Hamden building inspector’s notice, and the town allowed the development to continue.

For the first two decades, it was a great place to live. Once the condos entered the 21st century, though, the fill started to cause problems.

Over time, the dirt and organic materials under one of the buildings in the complex started to settle. As the fill settled, the foundation shifted and cracked, sending cracks throughout the building and sending torrents of water into some units.

In 2016, at least two of the units were deemed unfit for human habitation. One of the units had repairs to the roof, but the structural problems persist.

“Every time I turn around, I can find a new crack somewhere,” Brown said.

When the condos first sold in 1988, most of them went for $144,900. Since then, values have plummeted. In March, one of the condemned units sold for $20,000. In 2017, another sold for $17,900.

The crumbling foundation has not just affected the building that is actually cracking. Property values in the other building, which does not have structural problems, have also dropped.

In the last few years, units in the structurally sound building have consistently sold for under $50,000. In 2019, an LLC bought one of the units for $48,000. Just 14 years prior, in 2005, it had sold for $231,500.

Without help, the owners of the Pine Rock Condos will be stuck with practially worthless properties that cannot be sold at only a significant loss. Some, like Brown, may soon be forced out of their homes.

If the stars align, there may be a way out for owners stuck with crumbling condos. Hamden Director of Legislative Affairs Walter Morton recently took on the project on behalf of the town, and has begun working with residents to figure out what the options are.

Foundation Settled, Residents Fled

As a condo complex, the Pine Rock Condos are in a unique situation. The condo association is responsible for the upkeep of the grounds and the exterior of the buildings. Individual residents are not supposed to do the maintenance themselves. Instead, they pay their association dues, and the association takes care of the costs for everyone.

For many years, condo owners made sure their properties were well maintained, and their sense of neighborliness strong.

“You knew your neighbor. It was nice,” said resident Cameron Revels standing outside his condo Friday afternoon. Revels moved to Pine Rock in 1999. ​“The grounds were maintained. The trees were pruned. All this …” — he gestured at the cracks in the parking lot — “… it didn’t exist.”

He said neighbors used to barbecue outside and share bits of their dinners with each other.

But as the foundation of the building began to crack, so did that of the social fabric that made the complex so appealing. When they learned that they were paying mortgages on condos that were literally crumbling, some residents stopped paying and let the bank foreclose. Others sold to limited liability companies (LLCs) to get rid of the burden. Many stopped paying their association dues.

In the last ten years, many of the units have begun to bounce between LLCs. When Revels moved in, he said, the complex was entirely owner-occupied. Now many of the units are rented.

With so much turnover in the ownership, and many owners not paying their dues anymore, the condo association lost the money it would need to keep the complex in good shape. A few years ago, the longtime president of the association moved out of state, further compounding the problem.

Now the paint on both buildings is peeling. The wood around many of the windows is rotting. The roofs have not been replaced in decades. The shingles are showing wear.

The condo units on the end of the crumbling building continue to crack. They are visibly leaning to one side. From the outside, you can see the foundation buckling; the steps to the doorway are off-kilter with the rest of the building. Inside, the damage is more apparent.

In the words of town Economic Development Coordinator Dale Kroop, ​“it’s like a fun house,” with slanting floors and leaning walls.

Those condemned units on the end of the building have still sold, one as recently as July.

Since September, 2019, one LLC (or two related ones) appears to have bought four units in the complex. Harry Wilson & Sons, LLC, owns three of those. Another is owned by SP Capital, LLC, which lists the exact same business address as Harry Wilson & Sons in the secretary of state’s database.

Three of those units are in the crumbling building. Two of those are units that have been deemed unfit for human habitation, though one has since been fixed up.

A different LLC owns the unit on the very end of the building, with the slanted steps. Cordero Properties, LLC, based in Trumbull, which lists Lesman Cordero as its agent, bought it in 2019 for $30,000.

What Comes Next?

The owners of the Pine Rock Condos are stuck in a uniquely difficult web of factors.

First, their insurance policy includes a specific exclusion for settling foundations, meaning insurance will not cover the cost of fixing the problem.

Second, the fact that they are a part of a condo association complicates matters. Since the association is responsible for upkeep of the grounds and building structures and exteriors, individual owners cannot do work themselves. Any major action to fix the problem would require the assent of the association. But many of the condos are owned by LLCs, or are vacant, making it hard to assemble the number of owners necessary to make major changes to the ownership structure.

And funding sources are hard to find. While there are pots of money in the state to help individual homeowners and renters, finding help for condos is harder.

“Everybody has something for something, but not for this particular situation,” said Attorney Susan Epstein, who has been working with the condo association pro bono for many years. Since condos were mostly built in the 1980s, they rarely have the structural problems that older buildings have. That means there are no pots of money set aside to help condos like there are for houses built in the early part of the 20th century.

Residents of the Pine Rock Condos first learned about the problem after a 2004 study, Epstein said. In 2014, they enlisted Epstein to help them figure out options.

Kroop said he first heard about the problem in 2016 when a resident was trying to appeal their tax assessment. Though units are currently selling at below $50,000, they are mostly appraised at over $100,000. 

Kroop has helped other residents in town find money to repair their foundations after they shifted. Around the time he started looking into the Pine Rock Condo situation, he was helping residents of the Newhall neighborhood get funding from the state to fix their foundations because of shoddy soil and toxic fill from the Olin Corporation. That project just restarted, with another $4 million of unspent bonding coming to the town to fix more foundations.

Kroop said it became clear that the Hamden Economic Development Corporation (HEDC) would likely be the best entity to help with the problem. HEDC oversees development projects in town, and Kroop is in charge of it, but it is not funded or run by the town.

Because of the complexities of the condo association, one option would be to dissolve the condo association. The corporation could then take the title to the property, demolish the bad units, either rebuild them or not, and then let residents who want to stay rent.

Doing so, though, would require a vote of 80 percent of the condo owners.

After Kroop and others started looking for solutions, the association president moved away, and the project fell by the wayside for a few years. Now Morton has taken it up again.

Last week, he organized a meeting with residents to discuss the options. Right now, the options are unclear.

First, the condo owners and the town have to determine how bad the damage is and what could be done. Morton (pictured above) said that the HEDC will apply for a pre-development loan on behalf of the condo association from the department of housing to assess the situation and determine what needs to happen. Using the funds from that loan, HEDC will hire experts to figure out what the possibilities are for the building.

Then, HEDC, the condo owners, and the town will have to find some solution. It might involve dissolving the condo association and having HEDC or a developer buy the property. That would be tough, though, since every owner bought for a different price, and many cannot afford to take a significant loss.

“I will leave if you pay me out my mortgage, and you let me have money for a down payment on a new one,” said Brown.

The solution might also require state or federal aid. Special legislation is helping with the foundations in the Newhall neighborhood through state bonding. Morton said he will likely engage the town’s state and federal delegations, because it may require special legislation to dig people out of their mortgage holes, and their condos out of their shoddy foundations.

Whatever the best course, something has to happen. With every passing month, the cracks in Brown’s apartment grow larger.

“This is just not a way to live,” she said. ​“I don’t know. At any moment they can fall in.”