Page 4 - CooperatorNews NY February 2022

4 COOPERATORNEWS — FEBRUARY 2022 COOPERATORNEWS.COM PULSE Industry Pulse Trends Manhattan Sales Through the Roof in 2021 The end of 2021 turned out to be a ban- ner year for sales of residential real estate in Manhattan. Fourth quarter reports by brokerages Douglas Elliman, SERHANT., and Olshan Realty, in addition to analyses by publications 6sqft, Bloomberg, and Man- sion Global , indicate that the city that never sleeps has been wide awake on the property front, bucking trends from the prior year and surprising some industry forecasters. Highlights from the Elliman Report for the fourth quarter of 2021 included the highest number of co-op and condo sales in the fourth quarter for the last 32 years, with listing inventory falling significantly and new development sales making a particularly strong rebound. SERHANT.’s report notes that the quarter’s 3,380 recorded sales were a 77% gain over the same quarter the previous year, adding that for the first time ever, the same number of new development units priced over $10 million sold as those priced under $1 million. In its reporting, 6sqft finds that the quarter’s total sales volume of co-ops and condos reached $7 billion—the highest of any fourth quarter on record—recalling that the third quarter saw the highest num- ber of sales in Manhattan than any other period in the last 30 years. Units in new developments priced over $10 million are getting scooped up faster than any other apartment type, spending an average of 97 days on the market. “To put it bluntly,” says Garrett Derderian, director of market intelligence for SERHANT., “2021 was phenomenal. I’m not quite sure that even fully conveys just how strong a year it was. The fourth quarter was no exception.” Law & Legislation Reverse Mortgages Now Available to Co-op Seniors The end of 2021 was also a banner period for co-ops on the legislative front. In addition to the financial assistance available to shareholders in co-ops (as well as condo owners) through the Homeowners Assistance Fund (HAF), as reported in last month’s Pulse, more financial relief will now be available to New York seniors who own shares in a housing cooperative in the form of reverse mortgages. This legislation was a long time coming, supported in various iterations for years by many in the cooperative housing community before it was finally signed into law by Governor Kathy Hochul on December 1, 2021, per an announcement from New York State Senator Alessandra Biaggi (D - Bronx/ Westchester), co-sponsor of the legislation with Assemblyman Jeffrey Dinowitz (D - Bronx). Prior to this, co-op shareholders were excluded from reverse mortgages—a financial tool frequently used by older homeowners to access funds for daily living expenses by borrowing money against the value of their homes, which for many is their primary asset. Rather than paying off a balance over time, the reverse mortgage is repaid in full when the borrower dies or sells the home. “When Governor Hochul signed the reverse mortgage legislation,” said Mary Ann Rothman, Executive Director of the Council of New York Cooperatives & Condominiums (CNYC), “it provided thousands of seniors the hope of living out their lives in the housing cooperatives that have long been their homes.” According to the announcement, legislation to make owners of cooperative apartments eligible for reverse mortgages was originally introduced in 2018, but there were concerns among legislators about lack of consumer protections, given the prevalence of scams aimed at reverse mortgage seekers. Protections were then added, including the establishment of rules and regulations by the state Department of Financial Services (DOFS), explicit prohibitions on unfair or deceptive practices when marketing or offering reverse mortgage loans to cooperators, inclusion of supplemental consumer protection materials as deemed appropriate by the Department, provision of monthly account statements on lines of credit, and new procedural steps when a lender determines that a loan is in default that requires proactive contact with the borrower. Although former Governor Andrew Cuomo vetoed the legislation, citing among other reasons the risk to borrowers of being forced into foreclosure by unscrupulous lenders, Governor Hochul was satisfied with the supplemental consumer protections and signed the bill into law, subject to small changes that both houses and the Governor agree will clarify and strengthen its language. Biaggi said in the announcement that “as elected officials, we must do everything we can to protect our elderly homeowners–– especially in the midst of a pandemic. This legislation will grant elderly and low- to middle-income co-op residents the same resources and protections as traditional homeowners, ensuring that they are not ever forced to sell their homes and leave their communities if in need of additional loans. These protections will safeguard elderly communities and allow New York’s seniors, who so desperately wish to stay in their homes, the ability to do so. I am grateful to Assemblymember Dinowitz for his continued advocacy on this issue, and to Governor Hochul for signing this legislation into law and protecting our senior homeowners.” “Many residential buildings in New York are cooperative apartments,” Dinowitz added. “These apartments offer affordable home ownership opportunities to New Yorkers who may not be able or desire to purchase private homes or condos, and it is critical that we do not maintain a bifurcated system where different types of homeowners have different access to the equity contained within their homes. I am proud that this legislation has finally been signed into law, and I am grateful to the many organizations who helped support and shape this policy on behalf of older cooperators. Thank you to Governor Hochul for looking at this legislation with a fresh pair of eyes, and I look forward to a future New York where people are not compelled to leave their homes simply because they need some extra cash flow.” The law will go into effect May 30, 2022. Co-ops Finally Released from HSTPA Restrictionss In late December, Governor Kathy Ho- chul also signed a bicameral bill into law that essentially corrected the unintended inclusion of co-ops—where the sharehold- ers collectively own the property and are thus, in effect, the landlords—in protec- tions meant for renters under 2019’s Hous- ing Stability and Tenant Protection Act (HSTPA). The Queens Chronicle reports that under the new legislation, co-ops are no longer limited to requesting one month’s maintenance as a security deposit from ap- plicants, allowing them the flexibility to ap- prove financially marginal applicants who can instead secure their unit with, say, a year’s worth of maintenance fees to assure their ability to pay carrying charges. The legislation also gives co-ops the ability to charge a prospective shareholder for legal fees and background checks. Assemblyman Edward Braunstein (D- Bayside), a co-sponsor of the bill along with state Senator John Liu (D-Bayside), told the Chronicle , “Whereas in a tradi- tional landlord-tenant relationship where a tenant’s not meeting their obligations, the burden falls on what is typically a deep- pocketed landlord, in the situation with co-ops, it’s all the other shareholders who bear the financial burden when one of their fellow shareholders isn’t meeting their obli- gations. … The underlying point is that the shareholder’s relationship with the corpo- ration is different than a typical landlord- tenant relationship. When one sharehold- er’s not meeting that financial obligation, it really falls on everybody else to make the payments.” Scott Sieber, Liu’s communications director, said in an email, “The important point to remember is this bill gives co- op owners more freedom to determine the rules and regulations governing their own properties, such as whether or not they should be required to send communications with shareholders via certified mail, or relaxing restrictions on security deposits so that seniors who may be living on a fixed income could put in larger down payments, and not be prevented from participating in \\\[a\\\] unique \\\[form\\\] of affordable home ownership.” In a prepared statement, Liu said, “This legislation provides important protections for co-op homeowners from unintended provisions of rent laws passed in 2019. By implementing this new law, we allow New York City’s cooperatives the freedom to govern themselves independently without weakening the important tenant protections for renters that the Housing Stability and Tenant Protection Act was intended to reform.” The law went into effect immediately following Hochul’s signing of the bill. Transactions Beckford House Sells Out; 3 Penthouses Left at Beckford Tower A press release from developer Icon Realty Management announces that Beckford House & Tower, the two complementary residential buildings on the Upper East Side designed inside and out by Studio Sofield, have sold all but three of the Tower’s penthouses. Beckford House, the boutique condominium at 301 East 80th Street, is completely sold out, according to the release. The three remaining penthouses to be sold at Beckford Tower, at 301 East 81st Street, include recently completed Penthouse 29, listed for $29 million. Its 6,522 square feet comprise six bedrooms and six-and-a-half bathrooms, plus 193 square feet of private outdoor space. Penthouse 30, listed for $30 million, spans 5,452 square feet and offers six bedrooms, seven-and-a-half bathrooms, and three private terraces totaling 893 square feet of outdoor space. At the top of the tower, 4,141-square- foot Penthouse 31, priced at $20 million, has four bedrooms, five-and-a-half bathrooms, and three private terraces totaling 634 square feet. “We are proud to offer penthouses that celebrate the traditions of classical archi- tecture and return grandeur to New York apartments,” says Terrence Lowenberg, a principal at Icon Realty Management. continued on page 10