Appraisal Value and Purchase Price
In the letters COOCVE Directors received from Mr. Falco and Richard Rosenzweig, they argue that paying anything over a $2M appraisal is a horrible thing.
In 2009 the golf course was for sale. Master Management’s Board agreed it might be a good time to try to purchase the property. Here is an excerpt of Minutes of MM Board Meeting 2-12-09 (Minutes posted on CVEDB.com):
“Bill Morse discussed with the Board the financial impact of proceeding with the purchase of the Golf Course. Bill Morse made a motion to continue discussions with Fairway Investors on acquiring the golf course property with a letter of intent of $4 million. Anthony Falco seconded. After a detailed discussion, the motion passed 9-4 (yes votes were Reva Behr, Harry Chizeck, Anthony Falco, Gene Goldman, Susan Koser, Bill Morse, Charles Parness, Mel Schmier and Ira Somerset; no votes were Dick Ciocca, Jules Kesselman, Jack Kornfield and Bob Marcus).”
No appraisal was done in 2009. Knowing the real estate market was well below where it is today, the appraised value was likely less. But even using today’s likely higher appraisal of $2 million for just simple green space with no development, what do these same people who voted in 2009 now find so horrible?
2009: $4 million offer price / $2 million appraisal = Board agreed to pay 2 times appraisal value.
NO AGREEEMENT REACHED.
2013: $5.5 million offer / $2 million appraisal = Board agreed to pay 2.75 times appraisal value.
Mr. Falco and other members of that 2009 Board (being supported by our Commissioner, Richard Rosenzweig) say we should be offering no more than the $2 million appraisal value. Is that even realistic? Mr. Falco and the same Board members underlined in the 2009 Minutes above are suing us today for agreeing to pay over the appraisal value. Yet they voted to pay at least twice the appraisal value and got nowhere.
Your current Board of Master Management is motivated to do its best to purchase this property solely by what the Executive Committee, COOCVE and the majority of unit owners have told us they want. We are even conducting a vote to be sure. To-date, 52% of our owners’ ballots are in (majority) and 81% of those are in favor. These letters and the lawsuit seem to indicate this small group of people really do not care what the majority want and are only motivated by what they want. Master Management will continue moving forward and do its very best to stand behind the majority.