TITLE INSURANCE COMPANY
IRVING STREET LOFTS
ESCROW AGENT: TRANSAMERICA TITLE INSURANCE COMPANY
2200 U.S. BANCORP TOWER
111 SW FIFTH AVENUE
PORTLAND, OR 97204
ATTN: VICKI KRYSZAK
Real Estate Agency
CONDOMINIUM DISCLOSURE STATEMENT
IRVING STREET LOFTS, A CONDOMINIUM
(A PROPOSED CONDOMINIUM)
IRVING STREET LOFTS, LLC
2815 SECOND AVENUE STE 360
SEATTLE, WA 98121
THIS CONDOMINIUM HAS BEEN FILED WITH THE REAL ESTATE COMMISSIONER OF THE STATE OF OREGON IN ACCORDANCE WITH THE OREGON CONDOMINIUM ACT (0RS 100.005 TO 100.910 AND 100.990). ISSUANCE OF THE ATTACHED DISCLOSURE STATEMENT DOES NOT CONSTITUTE A RECOMMNDATION OR ENDORSEMENT OF THE CONDOMINIUM BY THE COMMlSSIONER.
THE SIZE OF THE INDIVIDUAL UNIT, THE DRAINAGE, SANITATION, D0MESTIC WATER SUPPLIES, INPROVEMENTS AND THE PHYSICAL DEVELOPNENT AND THE OPERATION OF THE UNIT OWNERS ASSOCIATION OF THE CONDOMINIUM PRO7ECT ARE NOT REGULATED BY THE REAL ESTATE COM.TSSIONER. THIS DISCLOSURE STATEMENT DOES NOT RELIEVE ANY PERSON FROM THE RESPONSIBILITY OF COMPLYING WITH THE REQUIREMENTS OF ANY FEDERAL, STATE, COUNTY OR MUNICIPAL AGENCY WITHIN WHOSE JURISDICTION THE CONDOMINIUZF IS LOCATED,
THE REAL ESTATE AGENCY HAS NOT PHYSICALLY INSPECTED THE CONDOMINIUM AND THE INFORMATION INCLUDED IN THIS DISCLOSURE STATEMENT WAS PREPARED BY AND IS A REPRESENTATION OF THE DECLARANT.
THIS DISCLOSURE STATEMENT MUST BE GIVLRN TO EACH PURCHASER NOT LATER THAN THE DATE THE UNIT SALES AGREEMENT IS FULLY EXECUTED BY ALL PARTIES AND RECEIPT THEREFORE MUST BE TAKEN.
PROSPECTIVE PURCHASERS SHOULD READ THIS DISCLOSURE STATEMENT
PRESALE DISCLOSURE STATEMENT
A Condominium is a special form of property ownership which is created and governed in Oregon by statutes known as the Oregon Condominium Act (ORS 100.005 to 100.910 and 100.990).
A Condominium is not created until there is a recording of the Declaration of Unit Ownership in the office of the recording officer of the county in which the property is located. A Plat of the property as well as a copy of the Bylaws must be recorded simultaneously with the Declaration.
Special provisions in the Oregon law allow for the sale of Units in a Condominium prior to their legal creation. This is accomplished by the adoption and issuance of a Presale Disclosure Statement by the Real Estate Commissioner and by compliance by the declarant with certain escrow provisions. These escrow provisions provide that purchaser's funds are to be held in escrow until the Declaration has been recorded and the interest bargained for by the purchaser has been conveyed. You should review the terms of the Master Escrow Instructions to fully understand your rights in a presale transaction.
NOTE: All references in this Disclosure Statement to the Condominium and its Declaration, Plat and Bylaws should be understood to be prefaced by the term "proposed" until such time as the required recordation of documents takes place and this Disclosure Statement is revised to reflect that recordation.
CONDOMINIUM DISCLOSURE STATEMENT
FOR IRVING STREET LOFTS, A CONDOMINIUM
This Disclosure Statement discloses certain pertinent information about Irving Street Lofts, A Condominium (the "Condominium"), located 1314 NW Irving, Portland, Oregon 97209, in the City of Portland, Multnomah County, Oregon. This Disclosure Statement has been prepared by Irving Street Lofts, LLC, an Oregon limited liability company (the "Developer"). Developer's telephone number is (503) 411-2685 and its address is 2815 Second Avenue, Seattle, Washington 98121.
On the date this Disclosure Statement was issued, Developer had prepared and submitted to the Oregon Real Estate Agency a proposed form of Declaration Submitting Irving Street Lofts to Condominium Ownership and a proposed form of Bylaws of Association of Unit Owners of Irving Street Lofts, A Condominium. Developer will record in the Deed Records of Multnomah County, Oregon, a final Declaration Submitting Irving Street Lofts to Condominium Ownership and a final Bylaws of Association of Unit Owners of Irving Street Lofts, A Condominium. The proposed or final Declaration Submitting Irving Street Lofts to Condominium Ownership is referred to in this Disclosure Statement as the "Declaration," and the proposed or final Bylaws of Association of Unit Owners of Irving Street Lofts, A Condominium is referred to in this Disclosure Statement as the "Bylaws."
General Description of Condominium
The project contains one building consisting of seven stories plus a penthouse and a parking basement level. The building is of poured-in-place, reinforced concrete and built-up roof. It consists of a total of 193 units, including 84 Loft Units designated for residential or commercial use, two Commercial Units designated for commercial use, 62 Parking Units and 45 Storage Units. Four of the Parking Units are partially leased to one of the Commercial Unit tenants and for the remainder of the term of such lease will not be available for use during the hours of 8:30 a.m. to 4:30 p.m., and one Parking Unit is fully leased to a Commercial Unit tenant.
Developer is offering a fee simple ownership interest in a unit to the prospective purchaser. Use of the portions of the basement level underneath street right of ways will be pursuant to a revocable permit from the City of Portland. Developer is currently applying for such permit. The owner of a unit also receives an undivided percentage interest, in common with other unit owners, in the "common elements" as described in Article 5 of the Declaration. A nominal percentage interest of .0001 is assigned to each of the Parking Units and each of the Storage Units. The remainder of the percentage interest is allocated among the Loft and Commercial Units in accordance with the ratio by which the approximate area of the particular unit bears to the total approximate area of all Loft and Commercial Units combined, as set forth in the Declaration. In addition, each unit owner also receives the exclusive right to use those "limited common elements" which pertain to his unit. See Article 6 of the Declaration.
The building was constructed around 1925 and renovated in 1989. The penthouse recreation rooms have been or will be converted into a Loft Unit and the deck over such penthouse will be a limited common element for such unit. In addition, the existing laundry room will be converted into a club room.
Water and sewer service are provided by the City of Portland. Electricity is furnished by Portland General Electric, gas is provided by Northwest Natural Gas, and telephone service is provided by U.S. West Cable television service is available from TCI. Prospective purchasers may contact these providers for further information on current rates and charges. Local services such as fire and police protection, schools, medical facilities and shopping facilities are available in the City of Portland.
Attached to this Disclosure Statement are reports from System Design Consultants, Inc. and a report from Schaber and Associates Inc. concerning the present condition of all structural components and major mechanical and utility installations at Irving Street Lofts, including the approximate dates of construction installation and the estimated useful physical life of each such item. The attached reports are only an estimate prepared in due care and based upon the present ascertainable condition of each item and its customary useful life. The Developer does not warrant that any specific component will, in fact, last for the useful life indicated.
Because Irving Street Lofts is a conversion condominium, Oregon law provides certain rights to tenants. Developer must provide a Notice of Conversion to each tenant in the project. In addition, prior to the sale of any dwelling unit which is to be retained as a unit in the condominium without substantial alteration in its physical layout, Developer must first offer to sell the respective unit to the tenant who occupies the unit. Developer cannot make this offer until at least 30 days after delivery or mailing to the tenant of the Notice of Conversion. Such offer will terminate 60 days after its receipt or upon written rejection of the offer by the tenant, whichever occurs earlier. It must be accompanied by a copy of this Disclosure Statement and may not constitute a notice to terminate the tenancy. The Developer may not sell the unit to a person other than the tenant during the 60 days following termination of the offer at a price or on terms more favorable to the purchaser than the price or terms offered to the tenant. The tenant's dwelling unit may not be shown to any prospective purchaser without the tenant's permission before the termination of the tenancy.
The Declaration creating the condominium may not be recorded until at least 120 days after the Notice of Conversion, during which period an individual apartment unit occupied by a tenant may not be renovated without the tenant's consent. Finally, since Irving Street Lofts is within the City of Portland, by City of Portland ordinance any tenant within HLJD Section 8 income levels is entitled to a waiver or refund of the last month's rent if such tenant does not elect to purchase.
Developer will sell units in accordance with Unit Sales Agreements which provide that the Developer may elect to delay closing of any sale until the date upon which the initial units of the Condominium to be sold having gross sales prices totaling not less than $2,500,000 are ready to close. If Developer has not satisfied or waived this condition by June 30, 1995, the Unit Sales Agreement will terminate and all earnest money deposits will be refunded to the purchaser, unless both parties agree to extend such date. See Section 4.1 of the Unit Sales Agreement.
The Developer is not offering to provide any financing to prospective purchasers. Within five days after execution of a purchase agreement, each purchaser must apply for loan approval by an institutional lender, or if the purchaser plans to pay in cash without obtaining financing, such purchaser must furnish Developer with any credit information requested by the Developer. In the event the purchaser is unable to obtain a loan or satisfy Developer of purchaser's ability to pay by the date specified in the purchase agreement and after diligent efforts to do so, the Unit Sales Agreement will terminate and purchaser's earnest money will be refunded, unless the time for obtaining such credit approval is extended by the parties. See Section 3.2 of the Unit Sales Agreement.
At closing, the purchaser will be responsible for the recording fee for the deed, any sales or transfer tax, an initial contribution to the working capital of the Association of Unit Owners equal to two months of Association assessments, accrued replacement reserves for the unit, purchaser's portion of the escrow fee, and all fees, costs and expenses in connection with purchaser's loan, if any, including the premium for any mortgagee's title insurance policy. See Section 4.3 of the Unit Sales Agreement.
If the purchaser should fail to make any deposit or payment required under the Unit Sales Agreement, Developer may declare the purchaser to be in default, and, without prejudice to any other rights of Developer, declare the entire amount paid by the purchaser forfeited to Developer. In the event the purchaser fails to deposit the balance of the purchase price with the escrow agent within the time set forth for closing, Developer may, in lieu of terminating the agreement, require the purchaser to pay to Developer at closing 12 percent per annum of the total purchase price from such date to the date of actual closing. See Section 5.2 of the Unit Sales Agreement
The units will be sold without warranty. Each purchase agreement will contain the following provision:
NO WARRANTY. living Street Lofts was constructed around 1925 and renovated in 1989, and thus is not a "newly constructed" condominium. Accordingly, Seller disclaims all warranties and covenants, express or implied, relating to the real estate, consumer products as defined in the Magnuson-Moss Warranty Act, or consumer goods as defined in the Uniform Commercial Code as adopted in Oregon. Purchaser, having had the opportunity to inspect the units and the common elements, accepts all real estate, consumer products and consumer goods sold under this agreement AS IS. Seller, however, will make available to Purchaser any manufacturer's warranties applicable to new appliances within the unit.
See Section 6 of the Unit Sales Agreement
Common Expenses, Assessments and Budget
The Association has the right to levy assessments against unit owners for the maintenance of the common elements and other purposes. Failure of a unit owner to pay his share of assessments will entitle the Association to file and foreclose a lien on his unit or institute an action to recover a money judgment for unpaid common expenses without foreclosing or waiving the lien.
The Bylaws specify that all owners are obligated to pay all assessments imposed by the board of directors on behalf of the Association to meet common expenses of the property. Such assessments will be made by the board of directors in accordance with the terms of the Declaration, which provides that the common profits and common expenses of the Condominium will be allocated to the owner of each unit based upon the allocation of undivided interest of such unit in the common elements, except that (a) eighty-three percent (83%) of the cost of operating, maintaining or repairing the central heating system win be shared by the units utilizing such heating system, (b) the cost of maintaining and repairing limited common elements will be charged to and shared by the units to which the limited common elements pertain, (c) if a Commercial Unit uses more water than would be used by a residential or office use of such size, then the cost of the excess water service will be charged to such unit, and (d) the cost of operating, maintaining or repairing the air conditioning equipment serving the Commercial Units will be charged to the Commercial Units. See Section 8.1 of the Declaration.
Developer has prepared an initial projected budget of the Association for the operation and maintenance and other common expenses of the Condominium. A copy of the projected budget is attached to this Disclosure Statement
NOTICE TO PROSPECTIVE PURCHASERS
THE PROJECTION OF THE BUDGET OF THE ASSOCIATION OF UNIT OWNERS FOR THE OPERATION AND MAINTENANCE AND OTHER COMMON EXPENSES OF THE CONDOMINIUM ONLY AN ESTIMATE, PREPARED WITH DUE CARE.
Provisions have been made in the projected budget for a reserve account for replacement of those common elements all or a part of which will normally require replacement in more than three and less than 30 years. The amount of such reserves have been computed by the managing agent on the basis of its experience in other projects. See Section 5.5 of the Bylaws for specific provisions relating to reserves.
Operation and Maintenance of the Condominium
Prospective purchasers should carefully review all of the sections of the Declaration and Bylaws, including those identified below which relate to the operation and management of the Condominium.
As provided in Section 14.1 of the Declaration, upon the recording of the Declaration Developer will organize an Association of Unit Owners to serve as a means through which the unit owners may take action with regard to the administration, management and operation of the Condominium. This Association will be an Oregon nonprofit corporation. As provided in Section 14.2 of the Declaration, each unit owner will be a member of the Association. The affairs of the Association will be governed by a Board of Directors as provided in the Bylaws. The owner of each Loft and Commercial Unit will be entitled to a vote in the affairs of the Association based upon the square footage of each such unit compared to the total square footage of all such units. No voting rights will attach to Parking Units or Storage Units. See Section 8.2 of the Declaration.
Article 10 of the Declaration limits use of the units as follows:
(a) Loft Units are to be used for residential purposes or for office, professional or studio purposes, and may be used for retail purposes only on a by-appointment-only basis. No uses are permitted that generate noise such as to disturb units used for residential purposes.
(b) Commercial Units may be used for retail, commercial or professional purposes, provided, however, that Commercial Units may not be used for manufacturing, sales of pornographic or erotic literature, objects or similar merchandise, for video or amusement centers or arcades, or as a nightclub or other facility providing nighttime entertainment.
(c) Parking Units may be used only for parking of vehicles and may be owned only by the owner of Loft or Commercial Unit and used in connection with the use of such a unit. Parking Units may not be used by any person other than an owner or tenant of such a unit. Transfer of Parking Units by or among unit owners is accomplished by deed or other form of real property conveyance instrument.
(d) Storage Units may be used only for storage purposes and may be owned only by the owner of a Loft or Commercial Unit and may be used only by the owner or tenant of such a unit. Transfer of Storage Units by or among unit owners is accomplished by a deed or other form of real property conveyance instrument.
Irving Street Lofts has been designated as "historic property" pursuant to the provisions of the Oregon Historic Property Act. Accordingly, the condominium must be maintained and operated in accordance with the requirements of such Act and the applicable regulations, including the requirement that the project be open to the public at least once each year for visitation.
Article 2 of the Bylaws describes the meetings of the Association and the method of voting by members. Article 3 of the Bylaws describes the Board of Directors, including the number and qualification of directors, election of directors, the powers and duties of the Board of Directors, meetings of the Board of Directors, and liability and indemnification of directors, officers and the managing agent. Article 4 of the Bylaws describes the officers of the Association.
Article 5 of the Bylaws describes the budget, expenses and assessments of the Association, including collection of assessments. Records and audits of records of the Association are discussed in Article 6 of the Bylaws.
Article 7 of the Bylaws sets forth the obligations of the unit owners with respect to the maintenance and use of the units and common elements. In addition, Section 7.5 of the Bylaws sets forth additional use and occupancy restrictions, such as restrictions on pets, and establishes the ability of the Board of Directors to adopt additional rules and regulations.
Article 8 of the Bylaws deals with insurance to be carried by the Association, and Article 9 deals with the method of adopting amendments to the Bylaws.
Rights of Developer
Developer has reserved the right to revise or amend the Declaration, Bylaws and Escrow Agreement to the extent reasonable changes may be required by governmental authorities, lenders or title insurance companies. Any other material changes to such documents will require the purchaser's consent. If the purchaser does not consent to the change, Developer may terminate the purchase agreement, in which case the purchaser's earnest money will be refunded.
Developer has reserved the right to adopt, on behalf of all unit buyers, the initial Bylaws and administrative rules and regulations for the Association of Unit Owners, to appoint an interim Board of Directors of the Association, and to enter into a management agreement on behalf of the Association with a managing agent. Developer has also reserved certain easements over the common elements. See Sections 12.5 and 14.4 of the Declaration.
The Developer will have the vote applicable to each unit owned by the Developer, and will have the right to appoint the Board of Directors of the Association until the first organizational and turnover meeting called by the Developer. See Sections 3.2 and 3.4 of the Bylaws. Developer must call the organizational and turnover meeting within three years after the date of the first conveyance of the first unit to a person other than Developer, or within 90 days after Developer has sold and conveyed 75 percent or more of the units in the Condominium, whichever is earlier. See Section 2.2 of the Bylaws. At that meeting, the interim directors will resign and the unit owners will elect five directors. See Section 3.4 of the Bylaws.
The Developer's prior written consent is required for any amendment to the Declaration or Bylaws so long as Developer owns 25 percent or more of the units in the Condominium, but no such consent is required after three years from the date of the conveyance of the first unit to a person other than Developer. See Section 16.2 of the Declaration and Section 9.2 of the Bylaws.
Documents by which Purchasers will be Bound
Prospective purchasers should carefully read all of the documents pertaining to the Condominium by which they will be bound. These documents include the following:
1. Declaration Submitting Irving Street Lofts to Condominium Ownership. The Declaration contains, among other things, provisions describing the units, the common elements, the rights of mortgagees, easements, and Developer's rights.
2. Bylaws of the Association of Unit Owners of Irving Street Lofts, A Condominium. This document contains, among other things, provisions relating to the management, use and operation of the Association and the rights and obligations of the unit owners.
3. Escrow Agreement between Developer and Transamerica Title Insurance Company. This document provides for deposit of funds into escrow and outlines a general procedure for the closing of unit sale transactions.
4. Unit Sales Agreement. This document sets forth the rights and obligations of the seller and purchaser and includes a notice to the purchaser of a statutory right to cancel the transaction within five business days.
5. Articles of Incorporation of Association of Unit Owners of Irving Street Lofts, A Condominium. This document contains provisions outlining the purpose and powers, membership, voting rights and dissolution of the Association of Unit Owners.
6. Management Agreement between the Association and Excelsior Property
Management, Inc. which deals with the duties and compensation of the managing agent.
8. In addition, purchasers may be bound by financing instruments, escrow instructions and provisions of the Oregon Condominium Act. Prospective purchasers should also inquire regarding rules and regulations, if any, that may have been adopted since the date of this Disclosure Statement
DATED: January 17, 1995
IRVING STREET LOFRS, LLC, an
Oregon limited liability
By GranCorp Holdings LLC, a
Washington limited liability company,
Michael Heijer, Manager