Structural Precarity and Potential in Condominium Governance Design
28 Pages Posted: 6 Jun 2022
Date Written: March 31, 2022
In the early hours of June 24, 2021, half of Champlain Towers South Condominium, a thirteen-story multifamily building located in the Miami suburb of Surfside, collapsed without warning. The Miami Herald called the collapse “unprecedented” in that one wing “simply caved in––for no obvious reason.” The collapse killed ninety-eight people and was the deadliest multifamily building engineering failure in US history. After an arduous search and rescue and safely dismantling the rest of the structure, inquiries sought to determine why this deadly collapse happened. Who was to blame, and what could have been done differently?
Within six months of this tragedy, engineering analyses pieced together a picture of a building with hidden, fatal vulnerabilities. Engineering experts concluded that the condominium’s building design was flawed from the start. The project was built by inexperienced developers using an architect who had his license suspended for “gross incompetence.” Dangers created by design vulnerabilities were compounded by shoddy construction in terms of materials and methods. Drainage and waterproofing were completely inadequate. A neighboring development may have weakened the condominium’s perimeter wall. The engineering post mortem analysis concluded: “This building was so overstressed for so long it’s amazing it stood as long as it did.”
The final straw that broke the back of Champlain Towers South was the failure to make necessary structural repairs. For decades, the condominium board had opted for superficial measures that masked the underlying vulnerabilities or even exacerbated them. Members of Champlain Towers South Condominium learned the extent of their building’s underlying and worsening structural problems in 2018 when the board commissioned an engineering study to comply with Miami’s multifamily recertification requirements. The engineering study identified several critically necessary repairs and warned that “[f]ailure to replace the waterproofing in the near future will cause the extent of the concrete deterioration to expand exponentially.”
After the 2018 report, the board planned for remediation of the issues raised, but many members of the condominium balked when they learned that these repairs would cost over $9 million, an estimate that later ballooned to $15 million. Minutes of board meetings over the three years prior to the building’s collapse show that repeated attempts to approve a special assessment to pay for repairs were stymied by disagreements about getting the work done and, particularly, paying for it. A vocal contingent of owners resisted the repair effort, and members of the Board resigned in protest. The necessary work was delayed for months and years until, one night, damaged rebar inside the concrete structure fractured, thereby destabilizing the tower and causing it to collapse in on itself “like a folding card table.”
Champlain Towers South suffered from design faults that created structural vulnerabilities as well as insufficient maintenance that exacerbated them, but the building’s ownership and governance design may have also contributed to the deadly effects of its structural failings. Champlain Towers South was a condominium, a legal ownership construction that theoretically encourages and enables adequate building construction and maintenance. In addition to asking engineering questions about the building’s physical structure, an analysis of the tragedy also requires asking legal questions regarding the condominium’s governance design. Structuring the building’s ownership as a condominium ultimately failed to ensure quality construction and upkeep, and condominium governance may also have inhibited remediation of the building’s structural vulnerabilities.
This Article examines a condominium’s legal structure in the context of ensuring construction and upkeep quality in a multifamily building and explores possible systemic improvements. Part I considers three latent vulnerabilities inherent in the condominium governance structure: (1) over-protection of developers; (2) unwillingness of members to ensure optimal upkeep; and (3) association financial precarity. Part II critiques some suggested legal responses to the Surfside disaster and discusses the swift and dramatic impacts on condominium governance caused by changed underwriting requirements of Fannie Mae and Freddie Mac. Finally, this Article concludes by calling for more effective stabilization of condominium governance to remediate its inherent structural weaknesses.
Keywords: Condominium, Construction, CIC, Structural, Collapse, Governance, Surfside, Building Code
JEL Classification: K11
Suggested Citation: Suggested Citation