New Clubhouse Presentation to - Lockwood Folly River Presentation2010… · Title: New Clubhouse Presentation to Author: BrewerDC Created Date: 6/28/2010 2:56:46 PM

New Community Center II

Presentation to Lockwood Folly POA

Members

Why a Repeat Performance?

Comment from a resident:

POA members voted down the

community center proposal last year. That

says they don’t want a new facility. Why is

the POA board bringing it up again?

Why a Repeat Performance?

The majority of POA members do want a new

CC; 60% voted in favor of last year’s proposal

(2/3 is required to approve financing)

If you review the vote tally, the proposal was

defeated by only about 40 votes

We believe the largest bloc of no votes were lot

owners who felt it was unfair to be charged the

same assessment as residents

Other Reasons for ―NO‖ VotesOther Reasons for ―NO‖ Votes

The economy and a $440 yearly paymentThe economy and a $440 yearly payment

Uncertainty about financing costs due to Uncertainty about financing costs due to

variable rate mortgagevariable rate mortgage

Too much wasted space, poor floor planToo much wasted space, poor floor plan

Golfers using main entrance, sharing Golfers using main entrance, sharing

buildingbuilding

More building than we needMore building than we need

Should have modern fitness centerShould have modern fitness center

Why a Repeat Performance?

Only a handful of members said we don’t

need a new community center

The board concluded that a two-thirds

majority of POA members would support a

new CC proposal if it eliminates the main

criticisms voiced last year

That’s only a change of 40 votes

Review Key Points from Last

Year’s Discussion

Review Key Points from Last YearReview Key Points from Last Year

We pointed out that the reason your POA We pointed out that the reason your POA

board exists is to protect and enhance the board exists is to protect and enhance the

value of properties owned by it’s membersvalue of properties owned by it’s members

We believe a new community center with We believe a new community center with

expanded amenities is crucial to support expanded amenities is crucial to support

Lockwood property valuesLockwood property values

Your Property Values are at StakeYour Property Values are at Stake

There are 31 Lockwood homes for sale

We have heard from several residents either selling or refinancing their homes

Their feedback indicates our lagging amenities are now hurting these efforts

Realtor comments that potential buyers are unhappy with Lockwood amenities

A recent appraisal in Lockwood came in $40,000 lower than comparable St. James properties due to ―average‖ amenities, according to the appraisal (see next slide)

Take it For What it’s Worth--Ratio of homes sold within last year to homes listed:

Brunswick Plantation 44% (66 listed, 29 sold)

Ocean Ridge 29% (42 listed, 12 sold)

Lakes of Lockwood 29% (21 listed, 6 sold)

St. James Plantation 27% (217 listed, 59 sold)

Sea Trail 25% (104 listed, 26 sold)

Brierwood Estates 23% (40 listed, 9 sold)

*Brick Landing (<Jan) 21% (14 listed, 3 sold)

Winding River 20% (44 listed, 9 sold)

Lockwood Folly 14% (36 listed, 5 sold)

*Brick Landing (>Jan) 0% (25 listed, 0 sold)

*Brick Landing data shown before & after the golf course was

closed

Your Property Values are at StakeYour Property Values are at Stake

If we are going to compete with communities like St. James or Brunswick Plantation with outstanding recreational amenities, we have to upgrade

We also have to look beyond what will support our current population; we have to attract younger active seniors who will be willing to serve the community in a variety of ways when the rest of us want to retire from board service

Review Key Points from Last YearReview Key Points from Last Year

Other issues we discussed:Other issues we discussed:

Need larger gathering spaces for Need larger gathering spaces for

meetings, eventsmeetings, events

Need office & administrative spaceNeed office & administrative space

Need smaller private rooms to handle Need smaller private rooms to handle

simultaneous meetings, social functionssimultaneous meetings, social functions

Need to prepare for growthNeed to prepare for growth

2009 Construction Options

Remodel/expand existing clubhouse Too expensive to modify & bring up to code

Not enough space to properly expand

Concern about noise from condo owners

Build new POA facility No adequate POA owned site available

Purchase Anne Arnold building Poor layout & location

Too expensive to renovate

Build on property donated by LFCC, keep existing clubhouse as supplemental space

2009 Proposal Summary

LFCC donates property for building site

POA includes pro shop & restaurant in

building design

POA provides rent free use of new LFCC

facilities

What Has Changed?

Design Modifications

We have redesigned the community center to incorporate many of the suggested improvements:

It is now about 1500 square feet smaller

We removed the ―Big Ass Fan‖ and improved the floor plan

It includes a fitness center

The exterior elevations are more attractive

Added Solar panels Free power for the building

Utility savings offset investment in 4.5 years

USDA FinancingUSDA Financing

We learned that grants & loans are We learned that grants & loans are

available to HOAs / POAs through USDA available to HOAs / POAs through USDA

Rural Development Rural Development

St. James is financing its new Town Hall & St. James is financing its new Town Hall &

Community Center with a USDA loan Community Center with a USDA loan

We have met with USDA officials and We have met with USDA officials and

confirmed we qualify for a low interest loanconfirmed we qualify for a low interest loan

USDA Financing

If granted, USDA financing will be a 4.125%

simple fixed interest loan with a 40 year term

It eliminates several criticisms from last year:

It’s cost will be much lower, as you will see

It eliminates the risks posed by variable rate financing

offered by commercial lenders

Lot owners will pay 75% of the home owner

assessment, same as dues

USDA requires a public competitive bid be conducted

to select a contractor

USDA Financing Status

We have submitted a loan application, but USDA We have submitted a loan application, but USDA

cannot proceed until LFPOA confirms that POA cannot proceed until LFPOA confirms that POA

members approve the projectmembers approve the project

We need to vote and get 2/3 majority approval We need to vote and get 2/3 majority approval

before USDA will continue the application before USDA will continue the application

processprocess

POA member approval does not guarantee that POA member approval does not guarantee that

a loan will be granteda loan will be granted

USDA funding is limited and there are other USDA funding is limited and there are other

applicantsapplicants

What Hasn’t Changed

Building Location & Concept

Unchanged is the building concept:

It will still be owned by the POA

It will still be located on LFCC donated

property adjacent to the pool

It will still contain a restaurant and pro shop

The agreements reached last year between

LFPOA & LFCCI remain intact

Land reverts to LFCC if community center is not

constructed

Comments About LFCCWith regard to LFCC amenities in a POA

facility:

Whatever your attitude about Lockwood

Folly Country Club and the golf course, it

is a Lockwood amenity which affects your

property values—go by Brick Landing if

you don’t agree

(Brick Landing golf course was closed in January due to

financial problems. What does it look like now?)

Brick Landing

14 listings before the golf course closed in

January and a 21% sales ratio

25 listings since golf course closed in January

with no sales

What does this mean?

Failure of a golf course in a golf community is

devastating to property values; we must

preserve all our Lockwood amenities

Comments About LFCC

This proposal does not mean the POA is

subsidizing LFCCI

The trade of land for pro shop and restaurant

is in both organization’s best interests

The POA gets a free building site

LFCC’s financial condition is improved with lower

operating expenses & lower capital liability

It is the least cost solution to our amenity

problems

Site & Building Details

Modified Floor PlanModified Floor Plan

14,635 total square feet vs. 16,100 14,635 total square feet vs. 16,100

Metal roofMetal roof

Solar panels to power the building replace Solar panels to power the building replace

―Big Ass Fan‖ ―Big Ass Fan‖

Pro shop downsizedPro shop downsized

Restaurant & kitchen layout improvedRestaurant & kitchen layout improved

Modern exercise facility with private yoga or Modern exercise facility with private yoga or

aerobics room and sauna & showersaerobics room and sauna & showers

Large meeting area moved upstairsLarge meeting area moved upstairs

Patio & deck functionality improvedPatio & deck functionality improved

Golf entrance moved to west sideGolf entrance moved to west side

Modified Floor PlanModified Floor Plan

Large Meeting Room Layout UnchangedLarge Meeting Room Layout Unchanged::

Dinner Seating for 222 people vs. 100Dinner Seating for 222 people vs. 100

Theatre Seating for 478 people vs. 108Theatre Seating for 478 people vs. 108

Standing room only capacity 669Standing room only capacity 669

Can be subdivided for smaller functionsCan be subdivided for smaller functions

Restaurant:Restaurant:

Inside seating Inside seating –– 8484

Outside seating Outside seating –– 5252

Exterior

Hardi-Plank shingles, same as before

Metal roof

Solar panels

Columns & base trimmed in stone

Added knee wall to patios

Upper deck improved

Better traffic flow (separate golf entrance)

Additional Recreational Space

The existing clubhouse will be re-faced to match the new Com. Cen. Exterior

Windows will be replaced

Upstairs activities would include billiards and arts/crafts

Downstairs would be converted to several individual card / game rooms

Between the 2 buildings, all our meeting & recreational needs are met

Proposal SummaryProposal Summary

Community Center will be financed & owned by Community Center will be financed & owned by POAPOA

Proposed building site is on the property Proposed building site is on the property between existing clubhouse and Pro shop/cafebetween existing clubhouse and Pro shop/cafe

LFCCI has deeded the property to POALFCCI has deeded the property to POA

Existing pro shop & café will be torn down and Existing pro shop & café will be torn down and relocated in the new community centerrelocated in the new community center

The project includes replacement of septic tanks The project includes replacement of septic tanks and a new septic field under driving range, per and a new septic field under driving range, per code requirementscode requirements

The project includes replacement of the existing The project includes replacement of the existing parking lot with additional parking spacesparking lot with additional parking spaces

The existing clubhouse will be retained The existing clubhouse will be retained

Project & Member

Costs, Timing

CostsCosts

Included in costs:Included in costs: Both kitchens, new septic system and parking lot replacementBoth kitchens, new septic system and parking lot replacement

Sound system *Sound system *

Card Based Security system *Card Based Security system *

Solar power *Solar power *

Upgraded exercise equipment *Upgraded exercise equipment *

Furnishings for entire buildingFurnishings for entire building

Construction interest *Construction interest *

Legal fees Legal fees

Architectural feesArchitectural fees

5% USDA required contingency *5% USDA required contingency *

Estimated Estimated totaltotal project cost project cost ---- $3.2M$3.2M

Financing With A USDA LoanFinancing With A USDA Loan

If we are approved:

Homeowners would pay $200 per year for 5

years

Lot Owners would pay $150 per year for 5

years

At the end of 5 years, assessments would

cease and your property will have no further

financial obligation for the community center

Financing A USDA LoanFinancing A USDA Loan

In addition to the assessments for 5 years:

In years 1-2 POA dues will increase by 10%

In year 3 dues will increase by 7%

In years 4-5, dues increase by 5%

After 5 years POA dues will cover the USDA loan payments and planned infrastructure replacement projects, incl. roads

Dues Increases are scheduled with or without USDA loan approval

Why So Much Lower Cost?

We are financing over 40 years, not 15

The Interest rate is lower

USDA charges simple interest, i.e., no

compounding

Timing If This Proposal is Accepted

TimingTiming

USDA loan process could take from 3 USDA loan process could take from 3

months to a yearmonths to a year

We would apply for Septic Permit (12 We would apply for Septic Permit (12 -- 15 15

months) upon approval by POA membersmonths) upon approval by POA members

Other permits 2 Other permits 2 -- 3 months 3 months

Construction could likely begin by Aug. Construction could likely begin by Aug.

20112011

TimingTiming

Your annual assessment for the Your annual assessment for the community center will commence after community center will commence after USDA approval, most likely at the start of USDA approval, most likely at the start of the 2011the 2011--2012 fiscal year2012 fiscal year

Construction takes 12 Construction takes 12 –– 15 months15 months

The new community center would likely The new community center would likely open in the first or second quarter of 2012open in the first or second quarter of 2012

Voting Procedures

Ballots

Ballots will be mailed sometime in July

Counting will take place 20 days after ballots are mailed

Ballots must be received by the due date to be counted

Ballots will be sent to every eligible POA member

Approval of this project requires a 2/3 majority of the votes received

Your vote is secret

Ballots Each ballot will be assigned a control number

Control numbers range from 1 to the number of ballots mailed; i.e., the # of eligible voters

The control number will be recorded when votes are counted

If more than one ballot is received with the same control number, both ballots will be discarded

The control number is not tied to a member

Any ballot with the control number missing will not be counted

The control number guards against duplicate ballots being submitted

Vote Counting

Ballots returned in ballot envelopes will

remain sealed until counted

Vote counting will be conducted by the

POA directors

Counting will be in the clubhouse, open to

all POA members

Tallies will be recorded on a spreadsheet

and displayed by overhead projector so

attendees can follow the count

Communications

Questions

A Q&A period will be held after each community center presentation

Other questions may be submitted by email to [email protected]

Questions submitted by email will be answered promptly

Questions and answers will be published on the POA website in a link to community center information

Comments

Comments may be submitted by email to [email protected]

Comments may be posted on the POA website via a link to the comments page

Both pro and con comments will be posted

Your comment must include a request that it be posted

Your comment must not offer inappropriate content (profanity or disparaging remarks)

What if Members Reject This

Community Center Proposal or the

USDA Loan is not Granted ?

If Community Center is RejectedIf Community Center is Rejected

The POA will still face the problem of

deteriorating and inadequate amenities

Realtors confirm that buyers want nicer and

more updated facilities than we offer

Fewer buyers means your property is worth

less than property in competing

communities

The POA board must address this problem

If Community Center is RejectedIf Community Center is Rejected

If the vote again indicates a decisive

majority of property owners support a new

community center, the POA board will

continue to pursue options for a buildingThe board will begin to look at plans for a

community center without financing

This means we have to have the entire

construction costs up front

If Community Center is RejectedIf Community Center is Rejected

This would involve larger up front assessments than

either last year’s proposal or this year’s proposal

Additionally, 10% dues increases would last for an

extended period of years

If a future project does not include LFCC amenities,

the POA may have to purchase additional property

In any set of circumstances, solving the amenities

problem will be much more expensive for all of us

than this proposal

Golden Opportunity

The availability of USDA funds makes this

our golden opportunity

This is probably our last chance for an

affordable solution to our amenity problems

This proposal is dramatically better than the

one proposed last year which failed by only

40 votes

Your BOD strongly recommends a yes vote

Thank You From Your POA BOD

Q&A