The Real Deal New York

Phantom condos rack up property taxes

May 19, 2011 12:40PM

Phantom condominium units at various locations across New York City are receiving property tax bills thanks to an anomaly in the way that New York assesses condominiums, according to the Wall Street Journal. State law states that co-ops and condominiums must be assessed as though they were rental buildings. Once the assessment for an entire building is determined, assessments are assigned to individual units based on their share of ownership, including units that have not been built yet.

It’s “like living in never-never land,” said Joe Bobker, a real estate developer and consultant on Morgan Lofts at 11 East 36th Street between Madison and Fifth avenues. The lofts were included in plans with the state attorney general, but were never constructed. City records reveal that two condos in the building owe a total of $217,302 in property taxes.

Other affected buildings include Gateway II on Frederick Douglas Boulevard at West 114th Street and Lee Gardens, a low-rise condo at 24 Lorimer Street between Marcy and Lee avenues in Williamsburg.

Owen Stone, a spokesperson for the Department of Finance, said the only solution would be for the sponsor to submit a revised plan, eliminating the affected units, but that would mean higher common charges for other condo owners. [WSJ]

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