From: Evan Prostovich [firstname.lastname@example.org]
Sent: Tuesday, April 26, 2011 4:06 PM
Subject: RE: the demise of the PSK property at Western Michigan U
In regard to your questions surrounding Droopy Corporation/ Chi Tetarton Housing Corporation I cannot speak for what was done prior to PSK Properties’ involvement or provide any specifics regarding how the loan funds were spent. In general, my understanding is that Chi Tetarton Housing Corporation became Droopy Corporation. I do not know why they needed to create a new corporation, but Droopy Corporation was the local chapter’s non-profit alumni housing corporation just like the old one. There were no beneficiaries or stockholders. It is my understanding that the funds from the loan were used for a new roof, new siding, new windows, new HVAC, and completely renovated 1st floor. I also think landscaping was done, parking lot paved, new fence put up, etc. Beyond that I do not have further details on prior operation of the property by the Chi Tetarton alumni. I would recommend that you contact your fellow alumni should you seek further information on the history of the property prior to PSKP’s involvement.
When we took over the property, we assumed control of Droopy Corporation and assumed payments on the mortgage, the balance of which was over $89,000. The capital that PSKP lost was from operation of the property over the course of the 3 years that we operated it and included debt service, renovations, repairs, local management, insurance, taxes, etc. PSKP did not charge any sort of fee whatsoever for our general oversight and operation of the property, the losses were all from outside expenses and money put into the facility. The rent and parlor fees collected did not cover our operating expenses and thus the losses were accrued. The additional funds came from our operations at other properties.