AZHOC - Arizona Homeowners Coalition
Voice for homeowner rights and justice.
azhoatruth@gmail.com
Login

New management company takes over HOA

New management company, Knightvest, took over ownership of property that has 30% owner condos and rest is rental units. So Management company, by virtue of percentage of ownership, has taken over the board of the HOA.- (unannounced, without consent). Now they have dictated a $7000 per owner special assessment for ‘property improvements’. Because of their take-over of the HOA, property owners have no voting rights and questions remain ignored regarding the type or extent of improvements (which have been very slow in coming, despite the influx of cash from the assessments. Additionally, the company has set up a third party company (LLC) for the funneling of work and cash, making it impossible to trace the assessment funds. Questions: Do you have insight into Knightsvest (Dallas company- blemished record in Texas and have recently stepped up their purchases of properties in AZ); the management takeover of the HOA is clearly a conflict of interest and what agency regulates that; is there a proven way to contact all homeowners (without fear of reprisal from management company) to form a group and file a complaint with the AZ dept of real estate. Any insight would be appreciated.

1 Response

  1. dennisl

    Robert,

    Help me understand your situation better? I’ve no experience with this particular management company so they are not the typical players in this state . What did they buy? Do they own all the 70% rental units? Who owned them before. What exactly is their voting power. They cannot be a declarant, even if they bought all the units from the original declarant, so the rules and capability of a declarant under the period of declarant control to appoint all board members and suspend all conflict of interest provisions of the law for those board members cannot be taking place. If the declarant sold the units to this company the period of declarant control immediately ceases. It sound like this management company thinks that it is the declarant and the declarant control pertains to them. Now if they have 70% of the voting power of the Condo then they can clearly by virtue of that voting power decide who they want on the board at an election held for that purpose. But those candidates must satisfy the qualifications requirements of the bylaws that typically require any candidate to be a member of the community.

    There is no state agency that regulates either the HOA’s or Condo’s or the management companies themselves in this state. Only the individual homeowners are left to enforce the law, and you can bet that to these associations and the HOA industry compliance with the law is totally optional if it suits them directly. Because they know that 99% of all homeowners will not sue the association for failure to comply with State law simply because it risk their personal money, and the association will use community money to defend themselves and if that runs out simply raise assessments to get more money.

    For the last two years I’ve drafted and got sponsored legislation to prevent the association from suppressing the ability to speak and communicate with other homeowners relative to community issues and business. Both year that legislation was defeated without both houses getting an opportunity to act on that bill. So right now the association is free to retaliate against any homeowner simply for trying to organize resistance to the actions of the board or management company.

    Dennis

Leave a Reply