Page 26 - CooperatorNews New Jersey Expo 2021

26 COOPERATORNEWS NEW JERSEY —EXPO 2021 NJ.COOPERATORNEWS.COM www.NationalContractors.net | 1-800-818-7663 “At National Contractors, Inc., our goal has remained the same since day one; to provide our customers with unparalleled quality and craftsmanship, exceptional customer service, and guaranteed satisfaction.” OUR SERVICES INCLUDE Inspections & Repairs Steep & Low Slope Roofing Siding Stucco, Brick & Stone Gutters Windows & Doors Skylights Decks Chimney Chase Caps PVC Membranes Coatings & Sealants EXTERIOR BUILDING SPECIALISTS (201) 343-4424 restorationmen.com American Architectural Restoration WE ARE THE REAL DEAL the property, whether in a high-rise, mid- rise, or townhouse setting, are owned and area are similar, but their regulatory au- maintained by the condominium associa- tion, of which the unit owner is a member. Jersey, it’s the Department of Community The condominium owner is for the most Affairs (DCA) that has regulatory author- part free to sell—or even rent out—their ity over common-interest communities. unit without much interference from the Across the river in New York, the state at- association board, which governs the as- sociation as a group. Co-op ownership is significantly more restrictive. Co-op owners don’t own their clature is the same—certificate of incor- apartments in the sense of having a deed poration, proprietary lease, and bylaws,” to a piece of real property. They own Smith says. “New Jersey also requires a shares in a cooperative corporation that Master Declaration, which is recorded owns the building in which their apart- ment is located, and are issued a propri- etary lease for their unit by that corpo- ration. They can sell those shares and transfer the lease—but only to a buyer approved by the board—and most boards flatly forbid renting or subletting units, though there are some exceptions. Why the Differences? Co-ops and condos are both common- interest communities, but their governing tors. By contrast, says Eliot Zuckerman, documents have inherently different legal mechanisms that determine how they function, says Wendell A. Smith, a partner at the law firm of Green- baum, Rowe, Smith & Davis, LLP, in Woodbridge. “In a co-op, the entity that owns ev- erything is a corpo- ration,” Smith says. “The co-op corpo- ration owns the en- tire building—the individual apartments mum duration of a sublet (two out of five and the common elements. Each indi- vidual resident has a proprietary lease to are typically easier to impose in a co-op his apartment and a share interest in the than in a condo,” Zuckerman says. corporation.” The number of shares in the co-op is both co-ops and condos alike—have some determined at the time of incorporation, misconceptions about the extent and lim- and is listed in the co-op’s offering plan. its of what their board is empowered to Allocation of shares to individual share- holders is based on an apartment’s square owners have,” says Ellen Shapiro, a partner footage and the desirability and location in the law firm of Marcus, Errico, Emmer of the apartment within the co-op, says & Brooks (MEEB), located in Braintree, Michael M. Kayam, a partner in Lasser Massachusetts, “is that the board exists to Law Group in New York City. On the other hand, “in a condo,” says is not your landlord; the board represents Smith, “the units in which the people live the community as a whole. It represents are individually owned, but the common the organization, not the individual own- elements are owned jointly. Each unit ers—and many owners don’t understand owner has title to an undivided propor- tional interest in the common elements.” owners have (or are given) the impression In an HOA, he continues, “the residents that they can call management, the board, own their individual units, but the as- sociation owns the common property— roads, lawns, clubhouse, etc. As an HOA in their interest. The board governs the member, each unit owner has a beneficial common elements, not the individual interest in the common elements, but not a legal title.” State by State The laws governing common-interest communities among states in the tristate thority and terminology vary. In New torney general regulates common-inter- est communities. For co-ops in both states, “the nomen- and establishes the co-op.” In the case of Garden State condos, that document is called a Master Deed. The ‘Landlord Complex’ A co-op corporation’s operations are controlled by its bylaws. Shareholders in the building meet and elect the directors, who in turn meet and elect officers. In New Jersey, Smith says, a condo is a non- profit corporation with a board of direc- a partner with Man- hattan-based law firm Smith, Gambrell & Russell, LLP, New York condos are unincor- porated associations which operate in many ways like corporations, with bylaws similar to those of a co-op, led by a board of manag- ers. Between the two, “\[policies\]—things like the maximum amount of financing a board will allow a purchaser to obtain, the maxi- years is typical), and alteration policies— It’s this part where many owners—in do. “The biggest misconception condo serve the owners individually. The board that. This creates a problem when unit or even the association’s attorney at any time and speak with them about anything A LOOK AT BOARD... continued from page 25 “Th e biggest misconception condo owners have is that the board exists to serve the owners individually.” —Ellen Shapiro See us at Booth 509