Earthquake: The Road To Recovery : Repairs Add Stress on Condo Boards : Shelter: Associations face diverse views about fixing damaged structures. The fear that some will abandon their units is high.

Peter Elias has faced a few hassles as president of the condominium owners association at Villa Saticoy, a 36-unit Tudor-style building in Canoga Park. There was a botched paint job around the swimming pool, bruised feelings about banning bicycles in the courtyard, and dealings with contractors for a new roof.

But nothing, absolutely nothing, prepared Elias and his neighbors for the complicated and emotionally draining choices posed by the building’s severe damage in the Northridge earthquake. Now they must decide whether, when and how to repair the structure--and do it all as a group.

Along the way, that building and hundreds of others throughout the Los Angeles region will test the shared ownership concept of condominium housing on an unprecedented scale, experts say.

Condominium associations are sometimes likened to representative democracies up close and personal. Now their earthquake emergencies could stir poolside civil wars in some instances or usher in new good neighbor policies across the balconies.

“I cannot make a decision without 35 other people. If it were just me and my spouse, it would be a lot easier to negotiate,” said Elias, a supermarket manager and part-time mortgage broker. “In this situation, this is everyone’s life.”

The biggest fear is that some unit owners in damaged buildings will abandon condominiums that had dropped in value even before the earthquake. If mortgage holders refuse to pitch in, remaining owners might have to bear a larger share of repair bills, perhaps triggering another cycle of abandonment. All that could create messy trails of credit problems, bankuptcies and lawsuits.

As a result of those concerns, condominium association meetings from Northridge to Santa Monica have taken on immense importance and are attracting crowds in a way that debates about awning colors never did. Although most decisions in the past were handled by buildings’ elected boards of directors, basic choices on rebuilding usually will require votes by a majority of the unit owners.

“Other than the boards, it used to be that only two people would show up to complain about dogs barking and loud noise. Now everyone is coming out in force,” said Alan Schimmel, a Sherman Oaks-based attorney who represents Villa Saticoy and other associations. “They are realizing they have common interests and have big decisions to make.”

And as in all governments, mixtures of solidarity and dissension seem to loom.

“Without a question, this is going to be the biggest test for these associations. And frankly, the test is just beginning,” said Brian Davidoff, president of Ross Morgan and Co., a firm that manages 130 condominium buildings in the Los Angeles area, including 40 that suffered quake damage. He predicts that about 10% of units in badly damaged buildings will wind up abandoned and foreclosed, with legal and financial problems in the wake.

Still, the strong appeal of condominium life--its mixture of private apartments and communal amenities--will overcome most such difficulties, said Kathleen Daniels, Los Angeles area executive director of the Community Assns. Institute, an organization that advises condominium boards. The neighborliness shown in the first few scary days after Jan. 17 will continue during repair decisions, she said.

“My sense is that most people are pulling together and working together to solve these problems and perhaps a very, very small percentage are not working together,” Daniels said.

The risk is highest at buildings like Villa Saticoy that had no earthquake insurance and now are declared uninhabitable.

“It’s a headache. Now we have 36 owners. What if 16 decide to walk and 20 decide to rebuild?” asked Elias Saleh, an engineer who in 1990 bought a two-bedroom unit at Villa Saticoy for $90,000. His older brother Michael, a baker, bought a similar apartment in the same complex for $97,000 in 1988.

The Saleh brothers were inside the complex recently, sadly surveying cracked walls, sunken foundation columns and the scattered trash of hasty evacuations. Almost all the apartments were emptied of their furniture after the quake--a good move because city inspectors soon will be changing the warning tag from yellow to red, meaning entrance will be forbidden.

Residents are awaiting an architect’s report on repair costs. Meanwhile, the association is applying for federal grants and loans and unit owners will be asking banks to reduce mortgage principals. But if no substantial aid materializes, the association may dissolve and let the lenders dispose of the property.

No scenario is pleasant, Michael Saleh said. “We are all living paycheck to paycheck,” he said.

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For them and many other condominium owners throughout Southern California, apartments with tiny fenced-in patios were a first grip on the American dream. They might not have had private yards, but they had tax write-offs and pride of ownership. At more affluent complexes, well-to-do singles and seniors who traded in single-family homes enjoy luxuries such as tennis courts and avoid the headaches of lawn care.

The much-mentioned “C, C and Rs”--the covenants, conditions and restrictions that control condo life--differ from building to building. In general, an individual’s responsibility starts at the paint job of his unit’s interior walls; the community as a whole usually shares responsibility for the rest.

Leonard Siegel, a Beverly Hills-based attorney who works with condominium associations, said the earthquake crisis has brought out the best: “What I’m seeing is a lot of dedicated, devoted people who recognize their obligations and are doing what they feel is the right thing for the community.”

It may be months before associations have enough solid information to make decisions about repairs and costs. First, insurance adjusters, inspectors, architects, lenders and federal aid officials must be consulted and possibly argued with.

With earthquake insurance deductibles often pegged at 10%, repair assessments at insured buildings are ranging from $1,000 to more than $10,000 per unit. Payments might be required in lump sums or spaced over many years on top of the mortgage bills, taxes and association dues.

Villa Saticoy’s first association meeting after the quake reportedly was a bitter affair, with some owners urging quick abandonment of the building. The next, at attorney Schimmel’s office, was more subdued; apartment owners, some with their babies in tow, listened to President Elias and other board members outline various financial strategies.

“We have to act as a community here,” Schimmel urged the group. An economic fault line in that building and others is evident. On one side are people who have sizable equity in their condominiums and will be more willing to pay for repairs. On the other are people who don’t and won’t.

At buildings with less drastic damage, owners are reminded that they all will share repair bills even if their units were not affected by the quake.

That is the message association President Arthur Rosenberg is getting across at Encino Oaks, a condominium complex of 10 buildings, 509 units and about 1,200 residents all linked by wooden bridges and lush landscaping.

About 100 Encino Oaks units are now vacant, either through inspectors’ orders or owners’ safety fears. Many other apartments show damage, including Rosenberg’s, where a bedroom wall has cracked open.

Architects and engineers estimated that all repairs will cost $9.5 million. That frightens residents until they learn that their insurance coverage has only a 5% deductible. Each unit owner will be assessed $2,600 on average, due in total in a year. Still, some are squawking.

Rosenberg and his fellow directors took the carrot and stick approach in a recent newsletter. “We will all need to tighten our belts for a time, but in the end, the rewards should outweigh the drawbacks,” they wrote.

Less certain of survival is Villa Saticoy. A preliminary estimate suggested that repairs might total $500,000, or about $13,000 per unit. But many owners believe that an upcoming survey will find much greater damage.

Elias, the president, is urging patience. He bought his two-bedroom unit with a loft for $125,000 four years ago and lived there with his wife and two young children. After the earthquake, they rented a Woodland Hills townhouse, sharing it with a Saticoy neighbor. Wider bonds among neighbors are sure to be tested in months ahead.

“It’s going to be interesting,” he said, “when it comes down to the final vote.”