07 Jun The Public Offering Statement Part 2
You bought a new home and for the first 2 years, you’re dodging construction vehicles and dealing with building noise and debris. It’s inconvenient but totally worth it because when you bought this brand-new home, the public offering statement showed there would be 3 parks, 2 swimming pools and a walking trail with access just yards from your backdoor.
Now news comes from the HOA about the completion of the project. The developer is ready to annex the last subdivision to the association. Except, none of the amenities were built near your home. The walking trail ends 2 miles away. The nearest pool is 20 minutes away and there’s no city owned or HOA park in any of the subdivisions.
A group of homeowners faced just that situation and brought it to light at a very contentious board meeting. Their point was simple. Why should they pay assessments for amenities that didn’t exist? What made it worse was that the land these amenities were supposed to be built on was being sold, by the developer, for commercial construction. Instead of a park there would be an apartment complex. Instead of a pool and clubhouse there would be a strip mall.
The association had a high percentage of owners that were the first owners of the properties. This meant that the public offering statement was binding. After the association attorneys reviewed the public offering documents there was a long discussion with the developer and, eventually, the parks, pools and walking trail were built.
There were some concessions made by the association, all within the legal boundaries of the public offering statement. But in the end, the first group of owners gave the future residents the community everyone had wanted.
In our previous example it didn’t matter if there were 20 or 600 original owners in the community. Even if there was only 1, the developer would need to supply that owner with the agreed upon warranties and amenities.
There are so many documents to keep track of when buying a home. Be sure to take the simple step and make certain you have the public offering statement. Keep it safe and read it often. The future of the community may be resting on those pages placed in a file folder in your office cabinet.