Pinnacle draws complaints

Pinnacle draws complaints

October 2nd, 2011 by Ellis Smith in Business Around the Region


• 1974 -- Built as Whitehall Apartments, name later changed to Grandview at Northside

• 2005 -- A real estate partnership, Stringers Ridge Associates Inc., organized by Wilkinson Real Estate Advisors, acquires the building

• 2007 -- First condominium sold

• 2011 -- 94 of 137 condos sold

Source: Wilkinson Property Management

About Wilkinson Real Estate Advisors

• What: Property management company

• Founded: 1985

• Size: 7,000 units

• Communities: 28 in four states

• Philosophy: Best-in-class service to residents, employees and investors

• Quote: "Wilkinson Real Estate Advisors provides superior service and value to the residents at our communities. We know people have many choices when making the decision where to live. At a Wilkinson community, the difference is the level of personal service and attention residents get from our staff."


Jackhammer noises during the day and water running across the floor at night aren't what Michael and Barbara Zema signed up for.

They're learning the meaning of "buyer beware," but it's a lesson they would have just as soon avoided.

The Pinnacle Condominiums, a 137-unit development launched in 2007, was built in 1974 as the Whitehall Apartments and later renamed The Grandview at Northside.

Michael Zema's sliding glass door, which allows water to run freely into the living room during heavy rains, was part of the building's Jimmy Carter-era construction, contractors have told him.

But the puddles of water in their living room are not entirely the door's fault.

Nearly a dozen affected residents also blame the newly installed balcony tiles that developer Wilkinson Real Estate Advisors added to the units -- tiles that raised the level of the terrace above the condo floor.

Gravity does the rest, as the Zemas' water-damaged floor attests.

Michael Zema said he originally had the water-damaged floor replaced and inspected as a condition of his purchase, but it turned out that the floor wasn't the problem.

Now, the Zemas rely on a cotton levee made of hand towels to protect the rest of the condo from encroaching moisture.

In fact, they still haven't been able to fully move in. Much of their personal life remains boxed up, stashed in the corner of the $157,000 condo.

Contractors say replacing the glass, raising the level of the doors and removing the tiles -- the only sure way to fix the problem -- would cost $2,000 to $6,000, depending on the unit.

"I'm a physician and I can afford this, but some of the people in this building have already put in everything they have," Michael Zema said.


Zema and the other residents claim that Wilkinson Real Estate Advisors, which operates in the building under the name Stringers Ridge Associates, should fix the problem.

But Zema's folder full of unanswered complaints speaks to the difficulty of assigning responsibility, he said, in an environment where legal and ethical responsibilities often come into conflict.

Wilkinson Real Estate Advisors representatives declined to discuss individual complaints, but the company added that it was taking steps to address the issues.

Chad Brammer, the developer's president and chief operating officer, said that the damage in many cases was caused by tornadoes that struck close to the building, and therefore could be outside Wilkinson's responsibility.

"I think it's important to point out the building was hit by two significant tornadoes over the last couple of years and problems developed as a result of those storms," Brammer said. "However, we are completely committed to honor all of our warranty obligations and we will work closely with the homeowners association to do our part in overcoming these challenges."

He also pointed out that the water damage was limited to a few units, and that most residents were happy.

"The well being and quality of life of our residents is a top priority, and the greater majority of those living at the Pinnacle will tell you that." Brammer said.

Communications breakdown

Although Wilkinson has fixed problems in the past, some current condo owners say their communications with the developer have been strained at best, with most or all requests left unanswered.

"I just got the distinct feeling from them that I was just sort of getting the runaround, it wasn't their responsibility," said condo owner Sharon Cranwell, who ended up hiring her own contractor to fix the leaking door. "It was fill out this form, fill out that form; and no matter what I do, Wilkinson is going to blow me off."

But Wilkinson's actions speak for themselves, she said.

The developer's effort to smash the offending tile out of the unsold units is clearly visable when peering over resident Katrina Lindsay's railing at the balconies below.

It's also audible, said Lindsay.

"They've been jackhammering like crazy for a week," she said.

She moved into The Pinnacle after her husband died so she wouldn't have to maintain a single-family home, but now she's growing increasingly worried about the pink mold crawling across her ceiling and walls and lurking under her floorboards.

Lindsay thinks it's unfair that the developers are fixing the unsold units in exactly the way residents themselves have requested their units be repaired.


Attorneys say that Zema, Lindsay and the others may never receive a dime through legal means.

The boilerplate contract they signed includes a "survival" clause that kicks in upon closing.

The survival clause negates the parts of the contract that hold Wilkinson responsible for functional doors and windows, Zema said, which he insisted be included after an inspector found prior issues with leakage.

"I asked if I could substitute my own contract, and they told me that in that case, I could go move in somewhere else," Zema alleged. "So instead I put in my own clause."

Unfortunantely for Zema, the closing of the sale effectively voided much of what appeared to be in the contract, according to Chattanooga attorney Joseph DeGaetano.

The sections that benefit the developer -- like the paragraph that entitles the developer to recoup legal fees and court costs in case of litigation -- survive the signing. However, the parts that Zema requested be included are rendered unenforcable.

"This is the reason that buyers of property need to have an attorney look over what they're about to do before they do it," said Chattanooga attorney Arnold Stulce. "An ounce of prevention is worth a pound of cure."

That was little comfort to condo owner Katherine Betts, as she surveyed her buckling 1-year-old wood floor last week.

"When it rains hard, the water bubbles in," she said.

"They're blaming it on [the April 27, 2011] tornadoes," Betts said of her interaction with Wilkinson officials.

Three-year plan

Other homeowners, however, say they were victims of water damage in the porous Pinnacle years before the 2011 tornadoes struck the region.

Charles Benson's household began to get soaked starting in April 2007 when he moved in, he said. It would take 36 months to end the involuntary indoor irrigation, he recalled.

In fact, he said he never even received so much as a response until he threatened to take his complaint to the news media.

"Once I said I was sending in the media, they got on it within three days," he said. "They took the complete window casing out on the balcony, scraped it, resealed it and put the casing back in. They took it completely out, the way they should have done it to start with."

He hasn't had a problem since then.

Water began entering Chase Pendergraft's apartment in May 2008, "within a day or two" of his moving in, he said.

"The lady who lived below me, who's no longer there, came up and asked me if I had a water leak. I asked why, and she told me 'because I have water running down my drapes,'" Pendergraft said.

He had nearly given up hope two years later that he would ever have a watertight condo, as the leak became just one of many problems with the building that he said included black mold in the vents, as well as cracked and leaking showers.

In 2010, the developer finally fixed the leaks.

"If I knew then what I know now, I never would have bought the condo," he said. "I put it up for sale, but I can't sell because the developers cut the price on their units by $30,000 and I can't compete with them."

Condo owner Thomas White just wants the same fix that Benson and Pendergraft received, but he's been stonewalled since March 28 when he moved into his flood-prone unit.

"I've turned it in as a warranty repair, because after less than a year, they're supposed to cover it," he said.

But even though he's submitted his repair request for the second time in six months, "I've not heard anything back."


There is, however, one glimmer of hope for the saturated residents, according to attorney William G. Schwall.

Schwall said that since homeowners were offered the contract on a take-it-or-leave-it basis, and the contract "effectively renders residents' warranty null and void," a court could rule that the contract is "unconscionable," he suggested.

"It's a contract of adhesion and it's a perversion of a promise," he said.

But any court case is still a shot in the dark, since Zema and his fellow residents could end up owing attorney fees for both sides of the case.

"Is it legal? Yes. Is it ethical? No," Zema said. "It's a ruse at best."