The Lauren, A Condominium

Annual Meeting -- May 14, 1997

President’s Report

Brian J. Larkin, Ph.D.

Introduction

Welcome to the 18th Annual Meeting of the Lauren Condominium Owners' Association. As some of you know, I was at the 1st Meeting of this Association and have been at each meeting since. And as some of you also know, I have worked with or served on every Board since that 1st meeting, including the original SATA (Sunderland Apartments Tenants' Association) Board that converted the Sunderland Apartments to the Lauren Condominium. 

Board Responsibilities

Last year I spoke at some length about my notion of the responsibilities of a Board of Directors. I do not plan to go into as much detail this year and you will be please to know that I do not plan to take as much time this year as last. Fortunately much of what we have attempted to accomplish this year will be covered in reports by my fellow Board members and there is little need for me to do more provide some background. However, the same four principles continued to guide this Board.

The Lauren Condominium Owners Association is a business. The Board is responsible for ensuring that its business is conducted in a professional and business-like fashion and that the three-quarters of a million dollar budget is spent prudently. These are your dollars that we spend.

1. Lauren Cost Containment and Revenue Enhancement Committee

2. Move-in Fees Schedule

3. Hot water heater selection and installation

4. Proactive Maintenance and Testing

5. Electrical and mechanical preventative maintenance testing

6. Electrical load testing

7. Air flow and exhaust system testing

The Lauren is an investment for the 143 resident owners, business owners, and investment owners. One of the principal responsibilities of any Board of Directors -- and it doesn't matter whether we are talking about IBM or the Lauren -- is to protect and promote owners' investments.

1. Lauren Marketing Committee

2. Lauren Zoning Committee

3. House Swapping Arrangements

4. Upgrading the Lauren and its Amenities

5. Hallway Redecoration

6. Awning Replacement

7. Landscaping

8. Roof Garden with Wind Chimes and Fountain

9. Sun deck and Pool Furniture Refurbishment - Picnic Table

The Board is responsible for promoting the safety and security of the 300 plus people who live and work here.

1. Lauren Safety Committee

2. Emergency Evacuation Plan

3. Lauren database

4. Floodlight Installation on Sunderland Place

The Board is legally, fiscally and morally responsible for the conduct of the Association's affairs. The buck stops with the Board. There is a chain of command that no owner, Board member, manager or employee should forget. You elect us. We are responsible to and answer to you. We hire managers, financial agents, legal advisors and they are responsible to us. They in turn hire staff who answer to them but they answer to us. And I stand here to report to you.

1. The Lauren Newsletter

2. Minutes Availability via e-mail and Internet home page

3. President's Letter to Owners

In addition this Board has continued the process of reviewing and strengthening operating procedures. There is a very long and time consuming list that I won't go into beyond saying we continue to look at virtually every aspect of how we do business. I'll tick off a couple so you have some idea of what I mean.

• We revised the move-in leasing process so as to protect everyone involved.

• We made considerable effort to ensure that everyone knows the rules, such as those relating to trash removal and laundry room use.

• We have revised the Personnel Policy Manual (again) and employed some new staff.

In summary, I think the four main accomplishments of this Board are

• Upgrading the Lauren. Some you already see and feel. Some you will see for the first time tonight. Some are still developing. Many are small but they are positive and combined they soon add up.

• Joe Morris and the Zoning Committee's work in investigating the labyrinth of governmental regulations and processes that affect the value of our property and the quality of life in the Lauren.

• Our continued work in reviewing and strengthening our business operating methods.

Where we stand

We are today I believe financially sound, organizationally strong and our prospect are good.

• Our financial condition is as solid it has been at any time in this decade. This could, of course, change almost overnight. But we are in good shape and should be better by the end of the year.

• Organizationally we have developed our business procedures and, while there are still some areas that could benefit from close review, our practices compare favorably with the best condominium administration and management in the country.

• With the work already done by John Doolittle's Marketing Committee in upgrading the Lauren and its amenities and in repositioning the Lauren as a premium condominium in the D.C. market, the prospect for rental values improvement is very good. And the work done by Joe Morris and the Zoning Committee offers potential for an improved future for all.

What problems lie ahead

The major problem we face today I believe is complacency. The Lauren is in good shape. It would be easy to let thing drift.

We could easily become lax about security for example. There is great danger here. One of the most important factors in marketing the Lauren, whether to renters or buyers is security. Ask any realtor in the audience.

We could easily become lax about our financial situation. The Lauren is getting on in years. Maintenance cost will rise. Unless care is taken to be proactive in funding capital expenses we could within a year or two easily find ourselves in a very difficult situation. For example, the chiller is going to have to be replaced and it must be replaced before it breaks down. If we wait until it springs a major leak and we lose the coolant, which would happen during hot weather, we would be forced to a) do a temporary repair job and b) replace the coolant which is no longer manufactured. The cost would be an additional $20,000 to $30,000. The alternative would be to go without air-conditioning for a season. Then we would have to turn around and immediately replace the chiller for another $100,000. We have a roof that will need replacing shortly and that's another $100,000. In all we will need close to $600,000 for capital expenses over the next four or five years. We will have it if the Board remains proactive toward capital expenses. And it should all be possible while maintaining an even 3 percent to 4 percent annual increase in dues.

Thanks

I owe a debt of gratitude to a great many people, members of this Board and the previous Board, members of the staff, owners and colleagues. I have asked a great deal of my fellow Board members and I am please that without exception they have responded graciously and generously. They have given more of their time, talents and efforts than is the custom of Board members to donate. Joe, John, Waldemar, Eileen. Thank you.

I owe a great deal to our manager, Walter Krolman. I have asked of him a great deal more than many managers are prone to give. He has responded with unfailing good humor and diligence. His attention to spending, for example, is one of the main reasons that we are in as good shape as we are.

We all own a debt of gratitude to Dan Benedick and Cacho for the outstanding gardening that makes the Lauren such an attractive place to live and work. I want to thank the entire Lauren staff for the diligence and friendly care that means so much to everyone.

• Security Committee

• Zoning Committee

• Marketing Committee

• Newsletter - Waldemar

• Cost Containment - Mike

I have sought advice from experts where ever I could find them.