Horizon West condo owners again face daunting realities as Waukesha building comes down

WAUKESHA - Picture the scene in slow motion, with each piece of your home being taken down deliberately and carefully over two months, while at the same time seeing your hope to recover financial resources from the loss crawl through an equally slow-moving legal process.

As the second anniversary rolled around of their emergency evacuation, it hasn't gotten any easier for the former residents of the Horizon West Condominiums.

In mid-November, condo residents and their building association were informed that a federal appeal in their efforts to gain partial compensation from the building's liability insurer had been unsuccessful. The decision came mere two weeks before the rest of the building at 315 N. West Ave. was expected to be torn down — coincidentally a day shy of the unhappy Dec. 2 anniversary.

Frankly, it has been depressing against a backdrop of ongoing hardship, residents acknowledge.

"The last two years have been a financial disaster," said Laurel Peterson, who had lived for 2½ years at Horizon West before its evacuation. "I always used to be one of those people who pays off her credit card in full every month — no more."

Final-stage demolition of condo building adds to residents' stress

Since October, the future of the six-story, 48-unit building hasn't been in doubt for even the uninitiated driving past it, perhaps unaware of the city order requiring the building be razed and the subsequent settlement that placed a timeline on the demolition.

MRD Group, a demolition specialist firm also trained in asbestos removal, methodically has been removing the outer walls section by section, one piece at a time, slowly exposing the skeletal structure.

That skeletal structure included key support components that were at the heart of the emergency evacuation on Dec. 2, 2021, when residents inside the building were essentially given about 15 minutes to vacate. Inspectors and engineers had determined the condo building was at "imminent" risk of collapsing.

Since October, a few residents have been seen outside the building now and then, observing the inevitable end. It's a daunting reality, and time hasn't entirely healed the feeling set in as a state of shock 24 months ago.

"Looking back on the evacuation, now it's like one of those slow-motion movies in my mind," Peterson said. "Even though the police notifying us were patient and kind, I still didn't really understand what was going on or why and I was in disbelief that my home — which I had no reason to believe was unsafe — was now unlivable."

Todd Dreger, who had lived nearly 4¼ years in the condo unit he owned, called the situation "an unresolved nightmare" exacerbated by his role on the association's board of directors.

"Seeing the interior deterioration is quite disturbing," said Dreger, who acknowledged a feeling that the original owner and builder in 1966 "cut corners" in the design of what was originally a rental apartment complex. "Happy we're out safely. Still in disbelief."

The lingering criticism of the original builder, Nick Chenenoff of Elm Grove, of what was then Ambassador West Apartments is partly tied to city records that detailed the problems in construction from the onset, though the degradation of the structure in recent years was not directly tied to those shortcomings.

Whatever the root cause, building inspectors and engineers began uncovering structural deterioration following a June 2019 storm that blew off soffits, exposing hidden problems. In June 2020, concerns about the safety of balconies prompted inspections, eventually resulting in their removal in 2021.

Further inspections late in 2021 resulted in the emergency evacuation, with the building shored up temporarily later that December to allow residents to remove their possessions in limited shifts, knowing a permanent return seemed unlikely against the cost of repairs.

Seeing it again, exposed and vulnerable before its final teardown, has evoked mixed emotions.

"It's a mixture of sadness as well as relief," Peterson said, noting the liability hazard the building carried as long as it remained standing. "I still look over at the space that was ours and it weirdly still feels like it's mine even though there are now literally no walls, or contents and all you can see are steel beams and the elevator shaft from the hallway."

Against ongoing costs, courts offer no help

Even as the walls were coming down, some former residents were hopeful federal courts would appreciate their plight. But that hope was suddenly, and likely permanently, dashed before the final piece of the building came down.

In a ruling recorded on Nov. 17, the Seventh District Circuit of the U.S. Court of Appeals upheld the earlier decision by U.S. District Judge Lynn Adelman to grant a motion of dismissal from Travelers Indemnity Company of Connecticut to dismiss the condo owners' $17 million claim from a one-year commercial property policy obtained in March 2021.

The appellate justices concurred that the claims fell outside the policy's coverage period or were subject to the exclusions spelled out in the document.

"Though mindful of the emotional and financial hardships this litigation and the events underlying it have caused the Association's members, we must give effect to the policy's plain terms, which, as the district court correctly held, do not supply coverage for the claimed losses," the appellate court's ruling stated.

Attorney Mike Ganzer, who represented the Horizon West Condominium Homes Association and its members, said Thursday there is no clear path for residents to proceed in the courts on this particular litigation.

"The next appeal would be to the U.S. Supreme Court, but they will not hear this kind of case since there are no federal law implications," Ganzer said.

For some residents, the ruling didn't shock them, hopes aside and given Adelman's earlier ruling.

"Disappointing, though no surprise," Dreger said, adding that he isn't "overly fond of having to recreate myself in my late 50s."

For Peterson, who acknowledged she also wasn't surprised by the appeal's failure and will now likely face bankruptcy, her disappointment is tempered by how older residents are worse off than her and her family.

"I honestly feel worst for our senior citizen residents who lost all their equity," she said. "Even though bankruptcy isn't fun, at least I'm young enough I can start over and recover financially eventually. Our retired residents can't really do that. The equity they were going to use for a down payment if they ever had to go to a nursing home is gone now and there's no way to get it back."

As for recouping money from the sale of the property, once the building is gone and the land is regraded, the prospects are poor, city officials have previously acknowledged. Any sale would be labor intensive for a buyer, who would have to locate and come to terms with all 47 owners before closing on a deal for what at that point would be a vacant parcel worth thousands, not millions, of dollars.

Dreger, who had used some of his retirement funds for a down payment on his condo unit in 2019 and had invested in "many updates inside," the reality runs counter to his plan back then. "(It) was to be my forever home," he said.

Contact reporter Jim Riccioli at (262) 446-6635 or james.riccioli@jrn.com. Follow him on X at @jariccioli.

This article originally appeared on Milwaukee Journal Sentinel: Waukesha Horizon West condo owners watch building fall, lawsuit fail