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Practice Overview

Commercial Condominiums

Our Real Estate lawyers regularly create commercial fee and leasehold condominiums to help clients navigate a mixed use/mixed ownership building. The condominium structure has the advantage of creating separate tax lots for the property and providing easements and insurance regimes to permit the building to operate efficiently. Separate tax lots also permit nonprofit unit owners to benefit from a reduced tax burden.

We have extensive experience creating, managing and enforcing the rights concerning commercial condominiums of ground-leased parcels, which are permitted under New York law.

Among the several commercial condominiums we have structured are the Tribeca Film Center, the Triangle Junction Retail Condominium and the Urban Glass House Commercial Unit.

We represented the ground lessor in a leasehold commercial condominium structure to permit New York Hospital to gain a real property tax exemption under Section 420-a of New York's Real Property Tax Law ("RPTL").

We represented a New York college in the purchase of a new commercial unit constructed as part of a redevelopment project in the Bronx under the federal "New Markets" tax credit program.

  • Represented an industry leading cancer research institution in a long-term ground lease for a 7-story building to be constructed to suit the institution on a parcel located on the Upper East Side. We then created a leasehold condominium for the institution to permit them to obtain a tax exemption under Section 420-a of New York's Real Property Tax Law. Our client then cooperated with the landlord to permit a $130 million mortgage on the fee estate.
  • Negotiated the ground lease for the fee owner/ground lessor at 407 East 61 Street with Weill Cornell Medical Center including a provision permitting Cornell to convert its leasehold estate into a commercial condominium. Cornell entered into two subleases with itself and became the "declarant" under the declaration of condominium for the leasehold estate thereby qualifying the leasehold interest as equivalent to a fee interest under the City’s tax exemption applicable to not-for profits. This transaction was the transaction that led to the well-know “Cornell” letter ruling on which the real estate industry now relies for the Section 420-a tax exemption for not for profits. 
  • Olshan represented the purchaser of the iconic Mobil Building at 150 East 42nd Street, including securing a $700 million loan from Morgan Stanley Mortgage Capital Holdings to complete their acquisition of the leasehold position. The deal included a 99-year ground lease extension with the land owner, purchasing the existing leasehold from Hiro Real Estate, and creating a sub-leasehold condominium to permit Mt. Sinai Medical Center to obtain Section 420-a tax exemption benefits.
  • Represented Metropolitan College of New York, a college founded in 1964 by educational pioneer Audrey Cohen, in the purchase of a commercial condominium to house its growing college programs within a $40 million development known as the Triangle Plaza Hub in the South Bronx . The construction and purchase of the condominium is being financed using New Markets Tax Credits.

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