Condo Controversy

NORFOLK, Va. - Newlywed Christina Colon points to the large hole in her ceiling where the rain has been soaking her bedroom.

"This is where the ceiling caved in while we were asleep," said Colon, standing in the Norfolk condo she shares with her husband, Omar. "I called the developer and said, 'It's literally raining in our second bedroom right now.'"

It's been weeks now, and their home smells like mold.

The Colons, who bought their condo nearly two years ago from Norfolk developer, Metro Housing Group, Inc., say many of the condo owners at the Kensington complex on 36th St. are furious with the developer.

The owners tell WAVY.com it's not just the serious roofing, plumbing and electrical problems they've been dealing with for more than a year.

They also believe $12,000 is missing from the Condo Owners' Association account.

Metro Housing still runs the COA. The law requires the developer to control the association for the first two years, before turning it over to the owners.

The owners say the last straw came recently when the water at the complex was turned off, again, for unpaid bills that should have been paid out of the association's account.

"We've had our water cut off three times since I've been here," fumed Bruce Boller. He bought his condo from Metro Housing in January 2008.

The owners each received a letter from the property manager, who was hired by Metro Housing, stating, "There's no way to sugar coat the current financial condition of the condo association. The association has insufficient funds to pay both past due and current bills."

The property manager's letter went on to read, "Metro Housing has not been responsive to either the city of Norfolk or the property manager." The real kicker... all the owners were instructed to immediately send an extra $400 to get the water turned back on and other passed due utility bills paid.

Boller, like most of the residents at the complex, is a first-time buyer.

"We had a meeting because we were all pretty much fed up with everything," he said.

The owners say they've been paying their rising condo fees and don't understand why the association's account is empty and why there has been no maintenance work for more than a year.

"Nobody has stepped foot on the property to do any kind of work, any kind of up-keep," said Boller.

Another owner, Rachel Young, chimed in, "I want to know where our money has been going. What have they been doing with our condo fees ? "

The owners finally called 10 On Your Side for help. First, we immediately got Metro Housing to waive the $400 emergency fee and the developer paid to have the water turned back on.

Then, we began investigating Metro Housing. The developer's website lists its office address as 4110 Granby St.

We went there, and the office was empty and up for rent. We called the realtor, William E. Wood and Associates, which told us Metro Housing was five months behind on the rent and was forced to move out.

Then, we went to Norfolk courts to do some digging. We discovered there have been 20 lawsuits filed against Metro Housing over the last few years.

In fact, the city of Norfolk has filed suit against the developer 13 times, according to court documents, mostly for non-payment of utilities.

We discovered William E. Wood successfully sued Metro Housing for that unpaid rent, more than $5,000. Also, a land surveyor, Ward M. Holmes, won a civil suit against Metro Housing for $5,000.
And a welding company, Adams Company, LLC., sued for another $5,000 for unpaid services.

The owner and president of Metro Housing, Lee Chepy told WAVY.com he is working to pay his debts to those companies. Chepy says it has been a very difficult year financially for his company and he admits the condo association he runs is broke and he should have done more to prevent the situation.

But, the owners at Kensington Condos still have one big question.

"Where has our money been going?" they keep asking.

Chepy says he has no idea and he wants the answer to that as well. He says he has never had any problems like this with any of the other properties his company has developed. Chepy did say he's been through three different professional management companies in the last 18 months. He also points out that, the condo fees are not paid to him or to Metro Housing. He says they have always been paid straight to which ever management company was running the complex at the time.

Chepy and the condo owners tell WAVY.com they have met several times now and they have decided to order an audit of the books.

Advice for anyone looking to buy a condo:

1) Make sure you know EXACTLY what is covered by your condo fees.

2) Check in to the financial condition of the condo association. Generally, it's a good idea to have atleast $3,000 per unit in the reserve fund.

3) Request copies of the association's financial statements, copies of the board's minutes for the last 6 months and a copy of the by-laws and rules.

4) Take charge, get involved in the association, even run for office.