How to take apart a co-op

Developers buying up supermajorities of shares

New York /
Sep.September 08, 2015 09:30 AM

In yet another indication of the searing heat of the city’s residential market, developers are making bids to buy out supermajorities of co-op shareholders, collapsing the cooperatives and opening the way for conversions.

At Buildings Like 253 West 28th Street in Chelsea and 150 East 78th Street and 1025 Park Avenue on the Upper East Side, developers aim to accumulate a large proportion of co-op shares, usually 75 percent, which triggers an automatic rental conversion of the remaining units.

The targets for these maneuvers are often small buildings in popular neighborhoods, with unused air rights and lucrative retail spaces on the ground floor, the New York Times reported.

Stuart Saft, a lawyer at Holland & Knight, said the preferred approach for developers is to buy the physical building from the co-op. Buying up shares leads to higher tax payments for developers down the road, when the building is converted and the condos are sold. [NYT]Ariel Stulberg

 

Related Articles

arrow_forward_ios
17 West 54th Street and Stuart Froum (Google Maps, Linkedin)
Renovation of stately co-op pits gum surgeon against board
Renovation of stately co-op pits gum surgeon against board
Guo Wengui and the Sherry-Netherland penthouse at 781 Fifth Avenue (Photos via Wikipedia Commons; Getty Images and Douglas Elliman)
Ensconced in the penthouse and entangled in lawsuits
Ensconced in the penthouse and entangled in lawsuits
108 Leonard Street with Nicole Kidman and Keith Urban (Google Maps, Getty)
Nicole Kidman, Keith Urban nab condo at Tribeca clock tower condo conversion
Nicole Kidman, Keith Urban nab condo at Tribeca clock tower condo conversion
(iStock)
Manhattan home sales experience record decline
Manhattan home sales experience record decline
Building managers, frustrated by rule breakers, seek to bolster their power to enforce house rules like wearing a mask (iStock)
Peloton plots, paramours and other problems as buildings reopen
Peloton plots, paramours and other problems as buildings reopen
“People are looking for that bubble”: Brick Underground’s Teri Rogers on a residential market under lockdown
“People are looking for that bubble”: Brick Underground’s Teri Rogers on a residential market under lockdown
“People are looking for that bubble”: Brick Underground’s Teri Rogers on a residential market under lockdown
730 Park Avenue (Google Maps, Wikipedia)
British aristocrats sue to quit Park Ave purchase
British aristocrats sue to quit Park Ave purchase
16 Sutton Place (Credit: Google Maps)
Sutton Place co-op in turmoil over terrace fees
Sutton Place co-op in turmoil over terrace fees
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...