ARBITRATION WITH MANAGEMENT REGARDING RENT

 

Century Village and Benenson Partners: A 57 (of 99) Year Financial Entanglement

Yesterday, Today, Tomorrow

Yesterday: From 1968 to 1974, Century Village, Inc., the builder of Century Village, sold its 309 association properties but retained ownership of the recreational properties. Each original condo owner had to commit to a 99-year Long term Lease (expiring on Dec. 31^st, 2068), paying (a) rent for the exclusive use and (b) assessment for the operations and maintenance, of these recreational properties. In 1999, the Millennium Amendment set the rent schedule and the expenses process until January 1, 2022 (about three months from now).

Today: Currently, owners pay a monthly (approximate average) rent of $90 plus an assessment of $45 = $135 month x 12 = $1620/year x 7854 units ≈ $12.7 million/yr. , about $8.5 million for usage and $4.3 million for operations and maintenance.

The conflict: The Benenson properties are currently appraised at $32.6 million. Century Village, represented by UCO, objects to paying not only 25% of the recreational properties' value ($8m rent/$32massessment = 25%) but also $4.3m to maintain the landlord's properties.

Unable to negotiate a financial agreement for the next decade, Century Village and Benenson Capital have entered into binding arbitration, as stipulated in the Millennium Agreement. Three arbitrators have been appointed, and will proceed as shown in the timetable below: (dates in bold)

Tomorrow: The Timeline for current arbitration.:

1.The parties shall each file and serve a position statement of claim by no later than Thursday, September 30, 2021. (Already filed and served)

2. A pre-arbitration site inspection that will occur on Wednesday, October 20, 2021, beginning at 11:00 a.m.

3. This proceeding is set for a three (3) day final arbitration evidentiary hearing on Tuesday, November 2, 2021, through and including Thursday, November 4, 2021, commencing each day at 9:00 a.m. and continuing until 5:00 p.m. or some other time as

designated by the Arbitrators. The length of time currently estimated for the final hearing is three (3) full days 1 The final hearing shall take place at the offices of Jones Foster at 505 South Flagler Drive, Suite 1100, West Palm Beach, FL 33401.

3.At the conclusion of the final hearing, each party shall electronically serve a proposed final award in word format, after which the final hearing on the merits shall be deemed closed. This deadline may be extended by up to two (2) days at the discretion of the Arbitrators if requested.

4. The Arbitrators shall issue a reasoned award with regard to the merits of this proceeding.

5. The Lessor shall notify by mail each Condominium Association and publish in a newspaper of wide circulation the results of the arbitration within fifteen (15) days from receipt of the conclusions of the arbitration panel.

So by the end of November, the lessor (them) and lessee (us) should know the next decade's recreational lease arrangements. Each party can go to court, but absent outright chicanery, that decision would probably be both expensive and futile.

Richard Handelsman