The "Carpenters Pension Trust Fund - Detroit & Vicinity"
(CPTF) acquired ownership of 63 incomplete
units at the Manors at Central Park Condominiums from "Sable
Realty Ventures - Shelby I Limited Partnership" in August of 2007. Sixteen of those
incomplete units were already under construction and the CPTF
hired Lombardo Homes to finish and sell them (those were in addition to the incomplete Units 1-14 along North Central Park that Lombardo Homes bought directly from Sable Realty Ventures in May of 2009 and upon which they subsequently built thirteen detached condos).
As of December 2011,
the CPTF stll owns 47 incomplete units and has no plans to begin
construction on any of them in the forseeable future. The CPTF also controls two of the three seats
on the Board of Directors of the Manors at Central Park
Condominium Association. Full control of the Board has not yet
transitioned to the co-owners and the third seat has been held by a duy-elected
co-owner of a completed unit since January 2008.
In accordance with Federal Law, the CPTF employs a Qualified Pension Assets Manager (QPAM) to manage their investments for them, including the
47 incomplete units at the Manors at Central Park Condominiums as
well as the operation of the Manors at Central Park Condominium
Association. Titanium Real Estate Advisors of
Chicago, IL has been the QPAM for the CPTF since August 2010 (prior to that Fifth Third Bank had been their QPAM).
Once full control of the Board is
transitioned to the co-owners (planned
to occur at the 2012 Annual Meeting on Jan. 18, 2012), Titanium will no longer be involved in the operation of the Manors at Central Park Condominium
Association. However, Titanium and the CPTF will still remain responsible for maintaining the appearance of their incomplete units and are also responsible for paying any Special Assessments levied against their units for the completion of unfinished site improvements such as the final layer of asphalt pavement on our streets.
At the beginning of its 2007 plan year, the CPTF was 67%
funded [see pg. 3 of this
document], meaning that the value of its assets ($1.08
billion) were worth about two-thirds the present value of all
accrued benefits being promised to the pension plan participants
and beneficiaries ($1.61 billion). During the 2008 plan year, its
funding fell below the Pension Protection Act's 65%
"critical" threshold, placing
it in the "red" zone and initiating the creation of a
rehabilitation plan to bring it up to the 80% funded level
("green" zone) by the 2019 plan year [see pp. 4-6 of this
document].
In a September 2009 report, Moody's Corporation
analyzed the funding levels of the 108 largest union pension
plans in the United States, which included the CPTF. A list of
those pension plans and their funding percentage is reproduced here.
Their report ranked the CPTF in 104th place, identifying it as
being only 41.4% funded at that time.
In 2010, the CPTF was again assessed as "critical" and placed in the "red" zone [see pg. 1 of this
document].
The CPTF is a multiemployer, defined benefit pension plan that
is safeguarded by the Pension
Benefit Guarantee Corporation (PBCG) under their Multiemployer
Insurance Program. The PBCG is a Government
Sponsored Enterprise, similar to Fannie Mae and Freddie Mac
in that it was created by the US Congress and it carries the
implicit financial backing of the US Government.
If the financial
status of the CPTF should deteriorate to the point of insolvency,
the PBGC will step in and mandate that they reduce their pension
benefit payments to a level that is supportable by the current
value of its assets. The PBGC also has the authority to provide
financial assistance to the insolvent pension plan and to also
exercise operating authority over the plan until all loans are
repaid.
In the event that the CPTF should become insolvent, more than likely the PBGC would then have the final say on all decisions regarding the CPTF's expenditures at the Manors at Central Park, including the payment of Special Assessments.
