Building Financials Available - 2022

2022 Annual Financial - 59 Pineapple Street.pdf

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Hi Neighbors,

Our 2022 Annual Financials are available here and on our website. You should also be receiving an additional emailed copy directly from Adventure Properties. Please inquire with Adventure Properties for a physical copy.

Here is a summary message from our Treasurer:

I summarized the coop’s financials for the benefits of new shareholders who may not have access to earlier statements. It goes back to 2006, the earliest financials I have. Adventure Properties has earlier years if anyone is interested.

During 2022, while we were able to increase revenues, operating expenses have exceeded revenues, hence we recorded a $21k operating loss (NOI). Real estate taxes are, once again, on the rise. RE taxes are our main expense and their growth has outpaced our ability to increase revenues. As a reference, since 2006, we have been able to increase revenues by $127k, however, opex has increased by $201k of which $167k is due to real estate taxes. Also note that from 2020 onward revenues have been lower than what they have been historically as the Board has decided not to implement the customary yearly operating assessment to provide the shareholders with our own version of the Covid-19 stimulus package. I assume that, as the pandemic ended, the operating assessment will resume in 2023.

While on a cash flow basis we were still positive in 2022 (CFO or cash flow from operation was $35k) and we had healthy cash balances of approx. $470k in operating and reserve funds. Opex coverage by cash and reserves remained stable at 9 months vs a typical 3x for coop in the area.

Talking about major capital improvements in 2022 we had only $16.5k vs $37k in 2021 and they were spent to upgrade the boiler and for remediating the roof permits. Regular maintenance increased to $62k, from $37k in 2021 with marked increases across all categories and plumbing, heating and boiler in particular (from $8.8k to $16.3k in 2022). Finally, professional fees were also substantially higher at $26.5k vs $18.1k in 2021 due to the roof legalization process.

Talking about the YTD performance, here below is a summary of the management prepared accounts:

1. From January to August, we collected $778k of which $304k are from insurance proceeds

2. However, in the same period we spent $981K, resulting in a $202K cash deficit

3. Of the expenses, $348k are directly related to the fire,

4. Then there are $208k in capital improvements. Of these, the major expenses pertain to elevator, exterior, hallways and security works.

5. Professional fees continue to be high at $18k

6. The rest is utilities, payroll, etc ($91k), administrative ($75k) and various expenses (including $22k of insurance premium).

As a result of the listed expenses in excess of revenues, our cash position has decreased to $268k, from $469k at FYE2022. Despite the substantial decrease in cash resources, I would not recommend raising maintenance or assessing the shareholders this year as, based on the above, we had extraordinary expenses that should not repeat and the situation should improve so next year. Also, we have a $100K emergency credit line that is available in full. Despite so, we need to continue monitoring the expenses as we still need to make the final payment for the exterior work ($75K) and there might be additional fire related work not yet factored in the above.

If any of the shareholders has specific questions about our financials, I remain available to answer to them via Zoom.

- Nicola

Thanks for being part of this community,

Board of Directors