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I am writing to seek your sdvice. I am a resident of a building with over 130 units. The sponsor basically sold all of the units years ago.
As of today the sponsor has control over the board invoking proxies that were sent out without the proper requirement. They are basically naming the board members as they please and they have someone from the sponsor managing the property called Asset manager that operates from he sponsor office with the sponsor email address. The president of the board is the selling agent of the developer and they are keep running their businesses from the premises by constantly reselling the units and making commission on them.
Is it possible for the sponsor to manage the property and control the board or is against the law? It should be noted that the largest majority of the owners are not resident, only few really live in the apt therefore is really difficult for us to do anything.
We are about to start a lawsuit but we are a little scared of the financial conseguences.
and that is exactly what the sponsor is counting on. Sponsors can do whatever they want because the costs of the legal system make the legal route untenable for owners/individuals.
I would suggest that nobody ever buy a unit from a sponsor, or one in which the sponsor still controls the building.
by the way, read the offering plan to see what the sponsor can and cannot do over time.
When you say the sponsor sold all the units and most of the owners are not residents. Who are the owners? Are they friends and family of the sponsors or investors?
If those owners proxy their vote to the sponsors, that would be quite different than owners votes are being done by the sponsor without their knowledge.
Generally there's a time limit on how long the sponsor can control the board after they sell down to a certein number of apts. Some of the new construction I looked at recently have 5 years of sponsor control
>>>>gcondo says I would suggest that nobody ever buy a unit from a sponsor, or one in which the sponsor still controls the building.
So that means one should never buy in a new construction? Are these by definition not controlled by the sponsor, at least when new units are sold and often for few years after
Yes Matsui, that certainly involves new construction. I do not see the benefit of riding the sponsor's risk coattails, thus my statement.
sponsors sponsor coops--not much new construction in coop land
sponsors sponsor condos. who cares about coops at this point in time wrt this thread.
Have your attorney look at Jennifer Realty, 98 NY2d 144. It's a case from NY's
highest court concerning Sponsors duties to the Coops they have created
Thanks you all,
In reality 90% of the owners are not resident but bought the place as pied a terre or investment. The sponsor sends out proxies with the name of his guy printed on it. They say they have the quorum but who knows, they don't show the numbers.
They are still managing the building with one person from their office that calls herself " Asset property manager".
i think that:
1. Proxies cant have the printed name on it.
2. They can't still manage the property since they should give away control . Building is 100% sold and Sponsor kept the commercial spaces.
read the offering plan