Units in Co-op Building
LVT Number: 8480
Landlord asked the DHCR for clarification as to how apartments become destabilized during a cooperative or condominium conversion. In an opinion letter, the DHCR stated that the co-op/condo exemption applies only if the sponsor has completed a bona fide sale of apartments under an offering plan. The sale must include transfer of ownership of the apartment from the sponsor to the buyer. As long as the sponsor remains the owner of the co-op or condo unit, the unit remains subject to stabilization. The DHCR also noted the following: Whenever a sponsor sells the minimum number of units necessary to convert a building into a cooperative or condominium, then any units that are vacant and any units that become vacant---including previously occupied stabilized units---won't be subject to rent stabilization. The sale of units occupied by stabilized rental tenants---which continue to be subject to stabilization during such tenant's occupancy---also would be considered as a sale contributing toward the minimum number of units necessary to effectuate a conversion.
DHCR Opin. Ltr. by Nathaniel Geller (2/11/92) [2-page document]