4 family conversion to condos

Yes you can certainly convert a 4-family brownstone to condominiums. I’ve done it myself numerous times, advised others on how to do it and sold condos for other small scale developers.

The process to do so is a bit time consuming and potentially costly as it requires a handful of experts to contribute to the Offering Plan, a document that would need to be approved by the NYS Attorney General’s office before the units could be brought to market. An attorney with experience in the undertaking would be your primary advisor.

As far as exit pricing goes re condo vs “as is” 4-family, that depends. It depends on where property is located and where demand for space configured in a certain way – ie 2, 3 or 4-bdrm units – is versus say the demand for an end-user looking to convert a 4-family to a 1- or 2-family. The cost to execute either of these scenarios also comes into play.

As far as lending to end-users goes, I am aware of some well known lenders that will be first in on a small condo conversion.

You can check out my profile, Donald Brennan, Brennan Real Es tate, on the Brownstoner “Agents” page under “Listings.” Feel free to reach out if you have any additional questions.

ITM

in General Discussion 7 years and 7 months ago

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hullsean | 7 years and 7 months ago

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Is there such a thing as to condo-ize a brownstone so as to sell the units as individual condos?

If so, what is the process? Any resources out there to learn more? I’m guessing it involves DOB, certain upgrades & inspections etc.

Has anyone out there done this? Can you get more per sq foot than selling the entire building?

EJR | 7 years and 7 months ago

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Yes, you could do this in theory. It would require hiring an attorney to help you navigate the process and file the appropriate paperwork. You, or your investors, if you have any, would then be the sponsors of the Condo and own all units, which you could then sell. Note that it will be difficult for buyers to get mortgage financing on these units as banks are reluctant to lend (i) where buildings which are majority unsold and (ii) where there are a small number of units, since the default of one of the units will negatively impact the financial wherewithal of the entire condo, putting the bank’s loan at risk.

I have seen condos with 4 units, but rarely less than that.

This would be a long and costly road, but you could, in theory, make some money on it, though it might take a very long time to see a return. It’s very difficult to say whether you would make more than just selling the entire building. If you modeled it out, you would certainly need to factor in the time value of money. Selling the building will take a few months. Going the condo route will take years.

adam_dahill | 7 years and 7 months ago

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Not to discredit EJR but I’ve done more than a handful of brownstone to condo conversions on the lending front. As small as 2 units to 4 units is fine. My contact info is listed in the services section of brownstoner.
adahill@loanDepot.com

decodeddreams | 7 years and 7 months ago

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Take a good look at the Google Street View for 2017 Grand Concourse. This is what happened to a 2-unit coop where one of the owner defaulted. The entire building has been in bankruptcy litigation for years. https://www.google.com/maps/place/2017+Grand+Concourse,+Bronx,+NY+10453/@40.8516699,-73.9044461,3a,37.5y,338.42h,96.85t/data=!3m6!1e1!3m4!1sWbOyPPY8f0_G8GrTRe_AkA!2e0!7i13312!8i6656!4m5!3m4!1s0x89c2f46e3b4089a5:0x5a6f31db8b8a3a1f!8m2!3d40.851836!4d-73.904663

decodeddreams | 7 years and 7 months ago

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annep | 7 years and 7 months ago

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Our condo building was a 4 story SRO in Bed Stuy converted to four condo units. The sponsors made the mistake of structuring the mortgage so that as units were bought they weren’t released from the collective building mortage – so that was fun working out with the attorney. All four units eventually sold, though, so doable.

mrohrmann | 7 years and 7 months ago

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If you are serious talk to Adam Dahill, he knows what hes doing.

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