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16 Feb 2018
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New York’s Newest Developments Are Finding Their Home in the Outer Boroughs

Manhattan may be the top destination for new development in New York City, but the outer boroughs are starting to catch up, and fast. In data just released for the year 2017, the vast majority of the top developments by square footage that were newly submitted for regulatory approval were from the outer boroughs. In fact, of the top ten, only one was located in Manhattan, with two each located in the Bronx and Queens, and a whopping five located in Brooklyn.[1]

Beyond just the number of projects, the square footage totals are also completely lopsided towards the outer boroughs. Manhattan’s single project works out to 167,701 square feet whereas Brooklyn’s top project alone totals 411,320 square feet.[2] Moreover, the bulk of these projects are for residential and mixed use development. This will serve to increase the already large population disparity that currently favors the outer boroughs, especially Brooklyn and Queens, over the already hyper-dense Manhattan. As the population of these boroughs continues to increase the local economy in these areas will also increase, further drawing ever more investment and thus further pushing even more development into the outer boroughs.

We can already see this virtuous cycle starting to take hold. In Downtown Brooklyn, Alloy Development’s proposed project for 80 Flatbush, which was facing daunting regulatory hurdles because of neighborhood opposition, has been revised ahead of its public review by the city to ensure a more positive reception. The new version of the proposal, whose first iteration was unveiled last spring, will bring “900 apartments, two schools, office space, retail, and more.”[3] With this revision, the project becomes much more likely to attain approval and become a new economic draw for Brooklyn.

Further East, the Willets Point redevelopment plan, a project that had originally been put on hold because of a court ruling against the proposed development’s shopping mall, is now back on track. The de Blasio administration, the Related Companies, and the New York Mets have come to an agreement on the central points of the megaproject, agreeing on the creation of 1,100 affordable apartments for low and moderate-income residents and the elimination of the mall from the proposal.[4] Given that the inclusion of a shopping mall on land zoned for a park was the project’s main impediment, and that the de Blasio administration has a stated goal of increasing affordable housing, this development, like 80 Flatbush, is also likely to become an economic draw, this time for Queens.

[1] Small, Eddie. (Feb. 9, 2018) “The top 10 biggest real estate projects coming to NYC.” The Real Deal New York. Available at: https://therealdeal.com/2018/02/09/the-top-10-biggest-real-estate-projects-coming-to-nyc-9. Accessed on: Feb. 13, 2018.

[2] Id.

[3] Plitt, Amy. (Feb. 13, 2018) “New looks, details for massive Downtown Brooklyn development ahead of ULURP.” Curbed New York. Available at: https://ny.curbed.com/2018/2/13/17004820/downtown-brooklyn-alloy-development-80-flatbush-avenue-changes. Accessed on: Feb. 13, 2018.

[4] Warerkar, Tanay. (Feb. 5, 2018) “Willets Point megaproject in Queens is back on, with a focus on affordable housing.” Curbed New York. Available at: https://ny.curbed.com/2018/2/5/16974964/willets-point-queens-citi-field-restart. Accessed on: Feb. 13, 2018.

09 Feb 2018
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New York’s Hudson Yards Development Gains Were Snatched from the Jaws of Olympic Defeat

This week marks the official start of the 2018 Winter Olympics in Pyeongchang, South Korea. The Olympics give their host city the chance to achieve substantial economic advancement and notoriety. New York has never been the host to an Olympic games, but in 2004 the administration of Mayor Bloomberg attempted and failed in a bid to host the 2012 summer Olympics. Strangely and unexpectedly, this planning for the Olympics without the actual costs of holding the games has led New York to achieve the development goals set out in the Olympic proposal, remaking multiple parts of the city, some still in progress. The largest development New York gained through the process is the Hudson Yards.[1]

It was the bid for the summer Olympics that finally gave the city government the impetus to push through the needed reforms that would eventually create the Hudson Yards as the hub of economic activity that it is today. As part of its Olympic bid, the city proposed a massive rezoning of the far west side, opening up the area to new investment in commercial development projects. Though the bid was lost, the rezoning idea remained. In 2005 the proposal—with the exception of an Olympic/football stadium–was passed into law. Now, thirteen years later, we can see the result. Commercial development has flourished in the area.[2]

Other benefits to the City flowing from the Olympic bid is that we now have  the exceedingly popular Hudson Yards extension of the 7 train, allowing, for the first time, subway access west of 8th avenue in Midtown Manhattan.[3] Further, part of the Olympic proposal was a doubling of the size of the Javits Center to serve as a hub for indoor sports. The project was revived by Governor Andrew Cuomo in 2016 and three firms have already been selected to bid on a $1 billion expansion plan for the complex, and start of construction is imminent.[4] Without the push of an Olympic bid, the Hudson Yards, a multi-billion driver of development and economic growth, simply might not have come into existence.

[1] Plitt, Amy. (Feb. 1, 2018) “New York’s unrealized Olympic dreams, mapped.” Curbed New York. Available at: https://ny.curbed.com/maps/winter-olympics-2018-nyc2012-bid-hudson-yards. Accessed on: Feb. 7, 2018.

[2] Williams, Keith. (Dec. 13, 2016) “The evolution of Hudson Yards: from “Death Avenue” to NYC’s most advanced neighborhood.” Curbed New York. Available at: https://ny.curbed.com/2016/12/13/13933084/hudson-yards-new-york-history-manhattan . Accessed on: Feb. 7, 2018.

[3] Id.

[4] Id.

02 Feb 2018
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Cryptocurrency Wave Crashes into the World of Real Estate

There is an old adage often thrown around political circles: money in politics is like water on pavement, it finds every crack and crevice. Substitute the economy in place of politics and it seems like cryptocurrency is on its way to becoming a real world example of this maxim. Created to bypass cash and enable incorruptible financial transactions using blockchain, a distributed digital ledger, these virtual currencies have been winding there way into an ever growing number of areas of the global financial system. With a current market cap of over $450 billion[1], cryptocurrencies have even made the leap into the physical economy, expanding their reach into real estate.

Real estate is known to offer relative stability and steady growth. In contrast, the value of cryptocurrencies can be unpredictable. However, the market with the greatest potential for cryptocurrencies so far has been residential real estate. Most real estate transactions involving cryptocurrencies have unfolded the same way. “The parties agree on a fixed price in dollars and then decide on a fair exchange rate at closing. The [cryptocurrency is] then converted to cash by a third party… which [is] then given to the seller.”[2]

The main concern with these transactions is the massive day-to-day or even hour-to-hour changes in the value of cryptocurrencies. “What seems like a fair exchange rate at the time, can seem like a steal or ripoff months later. [For example,] Ivan “Paychecks” Pacheco paid 17.741 bitcoin to Frank Mainade Jr. for a two-bedroom condo in Miami’s Upper East Side… [which] was equivalent to $275,000 with an exchange rate of about $15,500 per bitcoin. As of publish time on Thursday, those 17.741 bitcoins were worth $159,577.”[3] As regulations are still in the early stages, individuals need to be aware of the risks before exchanging real property for cryptocurrency as opposed to fiat currencies.

However, using cryptocurrencies for real property transaction is becoming a more common occurrence. A new company called Deedcoin has just filed with the Securities and Exchange Commission in preparation for its upcoming initial coin offering, a capital-raising event which disperses a set amount of cryptocurrency-based tokens to investors. Within Deedcoin’s system “buyers and sellers should be able to buy Deedcoin’s Ethereum-based tokens starting at $1.50 per token, and then use them to hire real estate agents nationwide. Agents who agree would then accept the tokens as payment in exchange for reducing their traditional commissions in U.S. dollars to as low as 1 percent, or an average of $225 per token used, the company claims.”[4] Though we have yet to learn what the true extent of the use of cryptocurrencies will end up being, it is clear that the real estate market is yet another area of the economy where cryptocurrencies are beginning to fill in the cracks.

Tips for Real Estate Buyers and Sellers Considering Cryptocurrencies[5]:

  • Do your research! Seek advice from an attorney or financial advisor.
  • Understand that cryptocurrencies are both an investment and real currencies that can be used to buy products or services, including real estate.
  • Don’t dive into the deep end without first testing the waters. Before purchasing real estate with cryptocurrencies, try buying and selling cryptocurrencies on apps such as Coinbase.

[1] CoinMarketCap. (Feb. 1, 2018) “Cryptocurrency Market Capitalizations.” Available at: https://coinmarketcap.com. Accessed on Feb. 1, 2018.

[2] Jacobs, Harrison. (Feb. 1, 2018) “Someone is selling their New Jersey house for $2.3 million in bitcoin – and it’s a growing trend.” Business Insider. Available at: http://www.businessinsider.com/bitcoin-payment-for-real-estate-listings-2018-2. Accessed on Feb. 1, 2018.

[3] Ib.

[4] Hinchliffe, Emma. (Feb. 1, 2018) “Real estate cryptocurrency startup Deedcoin secures SEC registration.” Inman. Available at: https://www.inman.com/2018/02/01/real-estate-cryptocurrency-startup-deedcoin-secures-sec-registration. Accessed on: Feb. 1, 2018.

[5] Olick, Diana. (Jan. 11, 2018) “5 Tips before you buy or sell a home in cryptocurrency.” CNBC. Available at: https://www.cnbc.com/2018/01/11/5-tips-before-you-buy-or-sell-a-home-in-cryptocurrency.html. Accessed on: Feb. 1, 2018.

29 Jan 2018
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A Guide for Co-op and Condo Board Members

Acting as a board member for a co-op or condo can seem like a full time job. Shareholders select board members to make and implement day-to-day decisions for the building. As a board member your role is to protect the interests of all tenants, owners and shareholders.  This requires playing an active role, effective communication, and demonstrating good leadership. However, what resources are available to help board members effectively manage their buildings? Whether it is for guidance on the impact of new laws and regulations or whether  your building is a landmark, there are various agencies and departments for board members to utilize.

The New York City Department of Buildings (DOB) “promotes the safety of all people that build, work, and live in New York City by regulating the lawful use of over one million buildings and construction sites across the five boroughs. With a focus on safety, service, and integrity, the Department enforces the City’s Construction Codes, Zoning Resolution, and the New York State Multiple Dwelling Law.”[1] The DOB provides vital information from building permits and sustainability to hiring licensed professionals and enforcing the rights of landowners, tenants and businesses. The DOB’s website keeps an updated track of all legal and regulatory changes that may impact your co-op or condo.

The Landmarks Preservation Commission (LPC) is “responsible for protecting New York City’s architecturally, historically, and culturally significant buildings and sites by granting them landmark or historic district status, and regulating them after designation.”[2] Why is this important for board members? Before a building undergoes any renovation, it is imperative to know whether the building or district has been marked as a landmark. The LPC provides guidelines for when buildings need to seek a permit before initiating interior or exterior alterations. Board members should note that LPC permits are not necessary for ordinary repairs or maintenance.[3]

New York’s 311 number has a housing and development sector for all five boroughs, which allows board members to reach the city 24/7 regarding any information or concerns. If the operators are unable to answer your question they will direct you to the specific office or agency you need. The City of New York’s website also provides helpful information on building management, maintenance, construction, ownership and taxes.[4] Another key resource for board members is the Attorney General, currently Eric Schneiderman. The AG’s office provides an abundance of guidelines and tip sheets for co-op and condo board members, shareholders and tenants. Tip sheets even include guides on how to handle problems with your condo and co-ops board of managers.[5]

Utilizing the different offices and agencies will help make sitting as a board member as seamless as possible. Quick resource guide:

  • New York City Department of Buildings – nyc.gov/dob.
  • Landmarks Preservation Commission – http://www.nyc.gov.lpc/ or (212) 669-7817.
  • Mayors Office and 311 – nyc.gov/mayor or 311.
  • Attorney General’s Office – http://www.ag.ny.gov/ or (212) 416-8122.  

[1] NYC Buildings. About Us. Available at: http://www1.nyc.gov/site/buildings/about/about.page. Accessed on Jan. 25, 2018.

[2] LPC. About Us. Available at: http://www1.nyc.gov/site/lpc/about/about-lpc.page, Accessed on Jan. 25, 2018.

[3] LPC. Applications. Available at: http://www1.nyc.gov/site/lpc/applications/applications.page. Accessed on Jan. 25, 2018.

[4] See http://www1.nyc.gov/nyc-resources/categories/housing-development.page.

[5] See https://ag.ny.gov/consumer-frauds/housing-issues.

12 Jan 2018
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Privacy Limitations in Co-ops and Condos

Are there limits on privacy for residents living in co-ops and condos? Yes. Living in a co-op or condo requires residents to make compromises for the interest of the building. In case of an emergency, repair or inspection, the board and building staff are permitted to access apartments. Where do co-op and condo boards get this authority? There will be provisions in the building’s governing documents typically requiring residents to permit access into their unit for the purpose of making necessary repairs or improvements required by law or for the purpose of inspection or of showing the unit to a prospective purchaser. New York law will require condo owners and co-op shareholders to comply with the by-laws of their building, and therefore permit board access into their apartments. Who is allowed in? This will also be provided in building’s governing documents, but generally the board, its agents and authorized workers.

As we have previously discussed, the board will require residents to provide a key for access to the front door, and for any doors providing access to water valves, plumbing fixtures and fire exits.[1] The board does not have authority to enter into a resident’s apartment without prior notice and consent or in case of an emergency. So how can co-op and condo boards avoid conflicts and tension when accessing apartments? They should have clearly written protocols that address when the board and other authorized personnel can enter apartments. When possible, boards should provide a written notice to residents explaining when a repair or inspection is to take place to allow residents to make proper arrangements (i.e. for supervision). When is notice not applicable? In cases of an emergency, governing documents will grant immediate access to authorized personnel. What constitutes an emergency? Gas leaks, fires, and substantial water leaks.

If a co-op shareholder or condo owner refuses access to the board and its agents for a repair or in an emergency, they could be liable for any damage, including damage in neighboring units. Boards should keep a record of any refusals of access for repairs or inspections in case the issue is brought to court. To avoid this avenue, the board and resident should communicate their concerns. If a resident wants to be present at the time of the repair or inspection, find dates that work for both parties. At the same time, the board cannot abuse its power. Residents need to report any unauthorized access to either the management or the board.


[1] Guzov, LLC. (Dec. 1, 2017) ”Precarious Co-op Rules.” Available at. http://guzovllc.com/precarious-co-op-rules/.

05 Jan 2018
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The Impact of the New Tax Law on New York Homeowners

In light of the Tax Cuts and Jobs Act , New York Governor, Andrew Cuomo, issued an emergency executive order No. 172 authorizing localities to issue warrants to collect early tax payments from homeowners in an effort to alleviate the “devastating impact”[1] of the new Act. Homeowners had the option of paying, in full or in part, their property taxes until the end of 2017 in order to claim higher deductibles for their federal taxes.

The new law caps state and local tax deductibles at $10,000, which has a significant impact on property taxes for New York homeowners. Governor Cuomo explained that “New York has made unprecedented progress reducing the burden of taxes on our middle-class families, and we will not allow this attack to roll back all we have achieved.” On average, residents in Manhattan “take the highest average deduction for state and local deductions, known as SALT, on their federal tax returns.”[2] The average SALT deduction in New York County is $60,400, whereas in Westchester it is $34,300. The Tax Foundation published the median property taxes paid across the U.S., the highest amounts being in New York State.[3]

The IRS announced that taxpayers could receive the deductible if they not only made the payment in 2017, but if the taxes were also assessed before the end of the year.[4] Although this executive order permitted homeowners to pay their property taxes early, in some localities this was not feasible. Homeowners is Westchester, who pay significant property taxes, were unable to pay their taxes for 2018 in 2017. The county executive, Rob Astorino, explained that “[i]t is just not possible for the county to issue its 2018 tax warrants to localities within the next four days for a whole host of legal, operational and practical reasons”.[5]

Homeowners in New York who were eligible but did not pay their property taxes early will now have to abide by the new tax code, which means capping state and local deductions at $10,000. What will be the future for New York residents? Governor Cuomo proposed for New York to restructure its tax code in order to “get out of the federal trap”.[6] This new tax code will  compel local governments to preserve the interests of its residents.


[1] New York State. (Dec. 22,2017) “Governor Cuomo Takes Emergency Executive Action to Deliver Property Tax Deductibility for New Yorkers.” New York State. Available at: https://www.governor.ny.gov/news/governor-cuomo-takes-emergency-executive-action-deliver-property-tax-deductibility-new-yorkers. Accessed on Dec. 28, 2017.

[2]Casselman, B. and McGeehan, P. (Dec. 4, 2017) “How New Yorkers Would Lose Under the Republican Tax Bill.” New York Times. Available at: https://www.nytimes.com/2017/12/04/business/economy/tax-bill-new-york.html?_r=0. Accessed on Dec. 28, 2017.

[3] Scarboro, M. (May 18, 2017) “Which Places Pay the Most in Property Taxes?” Tax Foundation. Available at: https://taxfoundation.org/median-property-taxes-county-2011-2015/. Accessed on Dec. 28, 2017.

[4] IRS. (Dec. 27, 2017) “IRS Advisory: Prepaid Real Property Taxes May be Deductible in 2017 if Assessed and Paid in 2017.” IRS. Available at: https://www.irs.gov/newsroom/irs-advisory-prepaid-real-property-taxes-may-be-deductible-in-2017-if-assessed-and-paid-in-2017. Accessed on Jan. 2, 2018.

[5] The Real Deal. (Dec. 27, 2017) “Why Westchester homeowners won’t be able to pre-pay their 2018 taxes.” The Real Deal. Available at: https://therealdeal.com/2017/12/27/why-westchester-homeowners-wont-be-able-to-pre-pay-their-2018-taxes/. Accessed on Jan. 2, 2018.

[6] The Real Deal. (Jan. 2, 2018) “Democrats in New York and California are fighting the tax overhaul. Here’s how.” The Real Deal. Available at: https://therealdeal.com/2018/01/02/democrats-in-new-york-and-california-are-fighting-the-tax-overhaul-heres-how/. Accessed on Jan. 2, 2018.

22 Dec 2017
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A Resident’s Guide to Board Transparency

We have previously discussed the duties and obligations co-op and condo board members owe to shareholders and owners, but what information needs to be disclosed and how transparent should boards be? What information can shareholders and owners access and what is off limits? First and foremost, it is important for residents to know their rights.

Co-op shareholders have the right, pursuant to Section 624 of the New York Business Corporation Law (BCL), New York common law, and generally their proprietary lease, to inspect the corporate books and records. It has been held[1] that co-op shareholders have the same legal rights to documents as shareholders in other public and closely–held corporations doing business in the State of New York. Therefore, co-op shareholders have the intrinsic right to protect their largest investment – their property. So what information generally must be disclosed to these shareholders? Documents such as meeting minutes, profit and loss statements, shareholder list, and accounting and bank statements. When requesting the board’s books and records, shareholders typically need to submit an affidavit confirming that they have not attempted to sell their unit in the past five years to avoid potential conflict.

Under the Condominium Act Section 339-w,[2] condo owners have the right to examine the books of receipts and expenditures of the condo. The provision specifies that “[s]uch records and the vouchers authorizing the payments shall be available for examination by the unit owners at convenient hours of weekdays. A written report summarizing such receipts and expenditures shall be rendered by the board of managers to all unit owners at least once annually.”[3] Recently the courts have applied the rights of shareholders to condo owners, whereby condo owners, who are acting in good faith, may retrieve documents such as “monthly financial reports, building invoices, board meeting minutes and legal invoices”.[4]

However, there are limitations on shareholders’ and owners’ rights to inspect the books and records. Certain documents contain confidential information that should not automatically be disclosed. This problem often arises in regards to board meeting minutes. If a shareholder or unit owner requests access to minutes that contain confidential information, the board may be able to make redactions, particularly if the information is “embarrassing or prejudicial”.[5] On January 1, 2018, Section 727 of the BCL will be in effect, which expands the scope of board transparency. Section 727 states that every condominium or cooperative housing corporation is required to submit an annual report to the shareholders including information of all contracts made, entered into, or voted on by the board, and the relevant details of those contracts.[6] As statutes and common law evolve, it is important for boards to practice greater transparency so that they are in compliance with the law and avoid potential conflicts and litigation.


[1] Guzov, LLC. (May 4, 2017) “Guzov, LLC Protects Co-op Shareholders’ Right to Safeguard Investment through New York Supreme Court Ruling.” Available at: http://guzovllc.com/supreme-court-protects-co-op-shareholders-right-safeguard-investment/.

[2] Condominium Act Section 339-w. Available at: https://law.justia.com/codes/new-york/2010/rpp/article-9-b/339-w/. Accessed on Dec. 22, 2017.

[3] Ib.

[4] Odenthal, Mike. (Nov. 9, 2017) “How Transparent Should Boards Be” The Cooperator New York. Available at: https://cooperator.com/article/a-board-beholden/full#cut. Accessed on Dec. 22, 2017.

[5] Ib.

[6] BCL Section 727. Available at: https://www.nysenate.gov/legislation/laws/BSC/727. Accessed on Dec. 22, 2017.

15 Dec 2017
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Holiday Do’s and Don’ts

December is the month of festivities and traditions. Various holidays such as Kwanzaa, Chanukah and Christmas all fall within December and residents in New York love decorating their homes to celebrate the holidays. However, what are the decorating do’s and don’ts and how can residence make sure their holiday décor is not hazardous?

As co-op and condo residents have a mixture of backgrounds, the board must ensure it establishes consistent, fair and safe practices. There needs to be a balance between celebrating the holidays and ensuring decorations do not offend any residents or become a nuisance or hazard. Although most co-ops and condos permit residents to celebrate the holidays by decorating their doors, some by-laws do prohibit decorating the outside of your apartment along with the common areas. Buildings typically allow residents to hang wreaths, dreidels and signs on their doors. As long as the board treats all residents’ religions and traditions equally, there is unlikely to be a problem, but be sure to check your building’s individual by-laws. Some residents may be permitted to hang decorations on their doors or terraces pending board approval. What about religious decorations on residents’ front doors? Many Jewish households place mezuzahs on their front doors as a sign of faith and not decoration. Courts have held that displaying mezuzahs is protected under the first amendment, regardless if a building does not permit any type of decorations.

For buildings that permit holiday décor in common areas, the rules should again be fair and inclusive of all faiths. To avoid tension, co-op and condo boards can ask interested residents to form a diverse committee to decorate and raise funding. Why shouldn’t a board use common funds for the holidays? Not all residents will want their monthly fees allocated to holiday decorations, particularly when they symbolize various religions. Independently raising funds will create greater transparency and avoid potential conflicts.

During the holidays residents tend to leave their tree lights on and keep the candles burning. To avoid holiday disasters it is important to follow basic safety procedures to prevent fires. The National Fire Prevention Agency (NFPA) reports that from 2011 to 2015 fire departments responded to around 200 fires starting from Christmas trees alone. Electrical issues caused 40% of the fires, candles 26%, and 24% of the trees were intentionally set on fire. During the same time period, fire departments responded to around 840 fires that were caused by other holiday decorations.[1]

For residents with real trees, make sure they are regularly watered and not near a radiator. For residents who opt for fake trees, it is important they are fire retardant. As a basic guideline, residents should not use real candles on trees and should always be home when the tree lights are on. Decorations with lights and candles in common areas of co-ops and condos should be regularly monitored and not left on throughout the night.

 

[1]National Fire Protection Association. “Winter Holiday Fires by the Numbers.” Available at: http://www.nfpa.org/Public-Education/By-topic/Seasonal-fires/Winter-holiday-safety/Holiday-fires-by-the-numbers. Accessed on Dec. 14, 2017.

13 Dec 2017
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Bushwick’s Repurposed Factory

In 2015, JLL, the real estate investment management company, secured $21 million from Santander Bank for ASH NYC, LLC’s project to convert the Dannenhoffer’s Opalescent Glassworks factory into a modern apartment complex in Bushwick, Brooklyn.[1] The glass factory was founded in 1888 by German immigrant John Dannenhoffer who was one of the first “pioneers in producing and manufacturing opalescent glass.”[2] Dannenhoffer’s son took over the family business, but after he passed away in the 1920’s the building was sold to other industrial manufacturers, such as Howard Lomazow’s Security Bag Company. [3] Today the factory is being re-developed by ASH NYC and JV Partner Martin Lomazow and is expected to be complete in 2018.

ASH NYC is re-developing the glass factory into a 77,000 square foot apartment building. The 63 units (including studio, one, two, three-bedrooms and penthouses) will be starting at $2,500 to $3,800 per month. How will this site attract New Yorkers? The building has been carefully curated to combine both luxury amenities and preserve and redevelop the brick walls and high ceiling beams. The expansion from the original brick on both sides of the building is designed with large windows creating optimal light exposure. Many of the units will also have outdoor spaces. Luxury amenities include state of the art appliances, community areas and work spaces, a fitness center, private study rooms, a rooftop pergola, sundeck and yard. The building will also be equipped with a tenant portal, virtual doorman and secure electronic key lock box.

The repurposed factory, located at 336 Himrod Street, is in a thriving neighborhood where developers have continued to maintain a balance between protecting the area’s rich history and creating modern residences. Residents have been attracted to the area’s culture, art and cuisine. The new development is close to a myriad of shops, eateries and gyms. Although the best way into the city is via the L train (which will be shut down for renovation in 2019) the Myrtle Avenue Line is also easily accessible.

ASHY NYC “[value] the extensive and unique history of the building and choose to highlight its original identity while adapting its functionality to serve today’s and tomorrow’s New Yorkers, cementing its futurity for centuries to come.”[4]

For images of the new space, click here.

[1] Real Estate Weekly. (July 1, 2015) “JLL Secures $21M Construction Finance for Bushwick Glassworks Redevelopment.” Real Estate Weekly. Available at: http://rew-online.com/2015/07/01/jll-secures-21m-construction-finance-for-bushwick-glassworks-redevelopment/. Accessed on Dec. 13, 2017.

[2] Glassworks History. Available at: http://glassworksbk.com/history.html. Accessed on Dec. 13, 2017.

[3] Ib.

[4] Ib.

08 Dec 2017
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When Your Board Needs a Quorum

In the by-laws for each co-op and condo, there will be provisions outlining the requirements for a quorum and in what instances a quorum is required. A quorum is mandatory at shareholder meetings or when the board is conducting business, except when otherwise provided by law. To meet the quorum standard, shareholders representing, in person or by proxy, a majority of the shares issued will need to attend the meeting. For condos, instead of shares, the by-laws will specify the percentage of common interest required to be present. The Business Corporation Law (BCL) § 608(a) sets out that “holders of a majority of the votes of shares entitled to vote thereat shall constitute a quorum at a meeting of shareholders for the transaction of any business.”[1]

Voting and Board Elections

For a shareholder vote, the shareholders who own a majority of the shares (or common interest in a condo) must hold and attend the meeting to form a quorum. Under BCL § 608(b), the building’s certificate of incorporation or by-laws can limit the quorum to one-third of the votes of shares or under § 616 increase the percentage of shares needed.

For board elections in co-ops and condos, there needs to be a quorum. BCL § 614(a) states that “Directors shall, except as otherwise required by this chapter or by the by-laws or certificate of incorporation as permitted by this chapter, be elected by a plurality of the votes cast at a meeting of shareholders by the holders of shares entitled to vote in the election.” For elections, co-op and condo boards must provide a notice to all shareholders and owners between sixty and ten days before the scheduled election.

What happens if a quorum is not present at a scheduled election? “Quite often in New York co-ops (and condos), … reports will be presented to shareholders. Why punish those who were nice enough to attend?”[2] Nonetheless, to hold the election itself, there must be a quorum present.

Revising the Building’s By-Laws

Every building’s by-laws differ in regards to the procedure of amending the provisions. Some corporations require either a shareholder or board of directors vote in the affirmative of two-thirds, seventy-five percent, or a super-majority to amend, alter, repeal or create new by-laws. If a quorum is not present at the meeting, the holders of a majority of the shares can adjourn the meeting to another date at which time the shareholders present at the original meeting are entitled to vote regardless of a quorum. Pursuant to BCL § 608(d) however, shareholders present have the option of adjourning a meeting even if a quorum is present.

When adopting a new resolution, generally all board members must be present. What happens when a board member cannot attend the meeting? BCL § 708 allows board members to either give written consent to adopt a resolution without the need of attendance or they can participate via conference telephone or others devices allowing everyone to hear each other at the same time, such as Skype and FaceTime.

[1] Emphasis added.

[2] Brucker, Andrew. (Dec. 2017) “Q&A: Quorum and Board Elections.” The Cooperator New York. Available at: https://cooperator.com/article/qa-quorum-and-board-elections. Accessed on Dec. 8, 2017.

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