I have a condo personality. Not everyone does, but I do. Down through the years, I’ve written quite a bit about condo ownership, culture and personality. I have very happily been living in a condo for over 20 years; it suits me. I despise gardening, cleaning the pool and worrying about the roof, all of which were part of my previous everyday life. But there is one aspect of condo ownership that frankly I haven’t thought much about until the last few years.
After the collapse of the residential condo building in Surfside, there were developers hovering around older condo buildings, especially those with Florida’s most precious commodity, waterfront locations. The interest in these buildings became more intense after the subsequent passage of a Florida law that requires most condo buildings over 30 years old to undergo structural inspections and correct structural failures. Owners and their boards of directors were approached by developers and started conversations about condominium termination rather than perform expensive repairs many long-time owners couldn’t afford.
Florida condominiums are by definition considered legal entities, just like corporations. They have boards of directors, owners, financial budgets and reserves and creditors. It’s different from single-family homes in that once you become an owner, you become part of this legal entity as just one of its unit owners. And that, of course, is where the condo personality or lack thereof comes in. If you don’t like making decisions by committee, better keep looking for the single-family home.
Condo terminations have been more prevalent in Florida than in other parts of the country because of the large number of aging condo units in South Florida and the lack of developable land near the water. According to the Florida Department of Business and Professional Regulation, over the past decade there have been at least 400 buildings that have undergone condo termination.
So how do you actually achieve a condo termination? All condominiums have bylaws that address condo termination and what the required number of owners must agree to in order to take this action. Some are 80%, some are less, and some are 100%. Realistically, under the best of circumstances, getting 100% of anything is virtually impossible.
In 2007, the state of Florida stepped in and passed legislation that essentially contradicted some condo bylaws by allowing 80% of the condo unit owners to agree to dissolve or terminate the condo regardless of what was written in the original bylaws. The state decided it was to the advantage of current owners who were considering condo termination but were stuck. This was also during the period of foreclosure fraud and the real estate crisis impacting the country. The statute goes on to say that once a developer acquires 80% of the units, it can terminate the condo.
Granted, it appears the law was decided in favor of developers, but individual owners are also benefiting. Some of the buildings being terminated would be staring down the barrel of major special assessments in order to bring the property up to code, making it unaffordable for owners and downgrading the value of their units. Developers state they are offering market value to owners, eliminating structural risks to the building and its owners and enhancing the aesthetics of the area.
Could this happen in Manatee County? Of course it could, but because we have height restrictions in many areas of the county, our waterfront condos may not be as tempting to developers. Nevertheless, all condo owners need to be aware of the change in legislation and the reality that termination of condos is happening in Florida.
In the meantime, my condo personality will help me overcome whatever happens.