Following up on last week’s committee meeting and the brief discussion at our regular meeting, here is how I see things with regard to our two primary building repair needs.
Regarding the parking lot, we are already on borrowed time. The current surface is at the end of its life. It has extensive cracking and is developing potholes than can no longer be patched and covered effectively. The drains have gradually separated from the grade of the asphalt surface, which is something that happens over time as the ground gradually settles and changes. All of this is to be expected with the existing 35+ year old asphalt surface. We have gotten all of the life we could have hoped for out of the existing materials.
At a minimum, the surface needs to be re-paved with new asphalt. Hopefully, the subsurface material remains in good shape and won’t need significant attention. If the subsurface needs any significant work, the cost of this project will increase dramatically. This is what the initial engineering work will tell us. The risk that we currently face is that, with each subsequent season that passes, water is more and more likely to penetrate the existing asphalt surface and unsettle the subsurface layers. There are multiple layers below the asphalt, all of which need to be perfect in order for new asphalt to be put on. The longer we wait before getting new asphalt on, the more likely that there will be subsurface damage, and the much higher the cost of this work will be.
Regarding the building envelope leak, this is a problem that has been with us for years. It is possible that this goes all the way back to the construction of the new building twenty years ago. We’ve caulked. We’ve been keeping the gutters clean. And those things have helped reduce the moisture that we get. But there is a bigger structural problem at play. The opinion of our Owner’s Representative is that there is a failure at some point where two or more of the various building materials meet in the structure of the wall. We have aluminum cladding and metal beams and wood windows and a few different types of masonry in those walls. Every time two of those materials meet, there needs to be a barrier to keep water out. Each of those types of barriers has its own possibility of failure, and it is possible that more than one of them is failing. There is no way to learn where the water is coming from without taking the wall apart from the outside and systematically exposing it to water to pinpoint the origin(s) of any leaks. Then we will know what needs to be done to remedy the problem.
In my opinion, there is less urgency here than with the parking lot for a few reasons. First, this is a longstanding problem. Any damage that we are likely to incur by waiting two years to repair this is unlikely to be significantly more than the damage that already exists in those walls. There are signs of water damage in the walls, but they aren’t very pronounced and don’t appear to be increasing at any observable pace. It’s possible that we could hit a tipping point with regard to mold or drywall degradation in the next two years, but I believe that the likelihood of this happening is small because I would expect to see more obvious physical damage to the walls and/or window frames and/or ceiling than we are currently seeing.
The total anticipated cost of the parking lot repair project is $250,000. This is based on previous engineering proposals of approximately $20,000, which typically total around 10% of the total cost of construction. I’m also building in about 5% inflation per year, as these proposals were submitted in early 2023. Around $10,000 of this amount would be paid in FY2024 to cover the evaluation and bid preparation portions of the engineering work. The rest would be paid in FY2025 with the reserve funds that are being accumulated in FY2024.
The total anticipated repair cost of the building envelope repair is unknown and dependent on a number of factors. The proposed cost of the engineering work to diagnose the problem is approximately $25,000. Per our Owner’s Representative, the outcome of that work will likely include three possible recommendations, viz. a minimum recommended repair, a substantial repair that might last longer, an extensive repair that would cost more up front but would likely require less maintenance and expense in the long run. The anticipated cost of these diagnosed repairs ranges from probably no less than $10,000 to well above $100,000, which is a difficult range for which to budget.
We probably don’t have the funds to address both of these problems at the same time. I say “probably” because there is a possibility that the building envelope could be a much less expensive fix when all is said and done. The problem is that we won’t know how expensive that fix will be until we lay out $25,000 for it to be diagnosed. I think that, for practical purposes, we should assume that it is going to be a costly repair. We are budgeting around $200,000 to go to our reserve fund at the end of 2024. We are also budgeting for $25,000 of special reserves spending during the course of FY2024. With similar amounts in our FY2025 budget, we likely have in the neighborhood of $450,000 to $500,000 to spend on such projects in the next two years. However, we would like to maintain a minimum balance of $200,000 in our reserve fund for an unforeseen emergency, should one arise. That leaves us with what I estimate to be the cost of one repair or the other, but not both, between this year and the next.
Regarding the parking lot, I believe that waiting two years could cost us hundreds of thousands of dollars in additional damage and repairs. I don’t believe that waiting two years to deal with the building envelope is likely to increase the needed repairs by a significant amount over and above what is currently needed to repair the envelope and repair the currently damaged building materials. So I believe that we should prioritize the parking lot repair with the understanding that the building envelope issue will be undertaken at the soonest possible opportunity thereafter.
My thoughts on a general timeline are as follows:
- We should move forward with the parking lot repair work first.
- I propose to collect proposals for the engineering work, to analyze the lot and prepare bid documents for the project, to be presented at the April meeting for approval.
- Engineering evaluation and bid document preparation would take place over the summer.Bid documents would be issued in January 2025 for opening/evaluation in February 2025.
- Construction firm would be engaged in March 2025 to complete work in the summer of 2025.
- Once the parking lot is finished and when the budget allows, we should begin the building envelope work.
- I propose that we solicit proposals for the engineering diagnostic work in the fall of 2025, to be presented at the January 2026 meeting for approval.
- Engineering work to diagnose the envelope problem would take place in the spring of 2026.
- Depending on the diagnosis, bid documents for that repair would be drawn up and issued in the summer of 2026 with a target construction date of fall of 2026 or spring of 2027, depending on budget and timing.
Recommendation: I don’t believe that we need formal board action to begin this process as the first step is simply to gather proposals for the parking lot engineering work. Based on your reactions to this report, I would proceed accordingly or propose a different direction. I am interested to know your thoughts.