All Forum Posts by: Zalman Ives

I recommend getting in touch primarily with a condo-conversion real estate lawyer. If you're not sure who to contact, you're best first step may be to find an existing condo and request an offering plan or the attorney's information. Most condo's/coops will have a law firm that represents them in closings and etc.

That law firm is a good place to start.

Good luck.

Thanks, Mohammed! That's great advice. I'll find a law firm.

0 Votes

New York City, New York

Multi-Family and Apartment Investing

Post: Converting Apartment Building Into Condos

Zalman Ives

Posted April 25, 2023 05:07

Real Estate Agent
Brooklyn, NY
Posts 53
Votes 28

Quote from @Jason Lee:

@Don Konipol No, that's not the case. No one converts to co-op now, only condos.

@Zalman Ives This is going to be very difficult, if not impossible. Under the new rent laws from 2019 you'd need 51% of the tenants to buy into the conversion plan. It used to be 15% and that was difficult, and typically achieved through steep discounts or buyouts of protected tenants. The 51% threshold will not leave enough meat on the bone.

@Jason Lee, thank you for your response, that is very helpful information.

1. Are there any regulations against tenants who receive steep discounts from selling on their condo at a huge profit?

2. If I were able to accommodate the 51% law, what is the process like? How long around does it take? How costly is the application process?

0 Votes

New York City, New York

Multi-Family and Apartment Investing

Post: Converting Apartment Building Into Condos

Zalman Ives

Posted April 23, 2023 22:58

Real Estate Agent
Brooklyn, NY
Posts 53
Votes 28

Quote from @Erle Thompson:

Where are you thinking about doing this? Some questions to ask would be:
- What does the city/county think about the idea? They can make or break you.
- What are the comps? both prices and length of time to sell.
- Do HOA's have a good/bad rap in that particular area?
- What is the performance of other associations in the area.

I personally have not done a condo conversion. I have had conversations with other who have sucsefully done them many times, mostly prior to the 07-09 debacle, and I was prepping to execute one in the market I was in, then the Financial crisis blew up everything and the idea got shelved. That said I have run the numbers a few times since then, and the cap rates always make more sense to keep as apartments. That said, with our current cap rate expansion environment it is very possible that could change.

Thanks, Erle, for your response.

This is in NYC. Conversions happen everyday. This specific building is way behind market value and rent stabilization will severely hold back property value.

Comps on condo sales in the area show really good numbers.

I just don't know what goes into the conversion process in NYC, how long it takes and how much it costs.

Do you know anyone who did a conversion in NYC who may be willing to talk with me?

0 Votes

New York City, New York

Hi All,

I am looking to get to know some busy business owners to see if we can partner up.

I am a full time real estate investor and I would like to scale by partnering up with someone who has capital to invest but is too busy to invest on their own.

Similar to syndications, but this is a personal relationship and there is only one investor in each deal.

Hit me up if this is something that you or someone you know is interested in and let's chat!

0 Votes

Multi-Family and Apartment Investing

Post: Converting Apartment Building Into Condos

Zalman Ives

Posted April 23, 2023 16:11

Real Estate Agent
Brooklyn, NY
Posts 53
Votes 28

Hey, do you have experience in buying an apartment building and converting it into condos? Would you be open to a conversation with me to guide me through some basic expectations and things to know going in? Thanks in advance!!

0 Votes

New York City, New York

@Breland Clark & @Lou Mancini, how was your experience? Is this the Acqua Funding that is based in Brooklyn, NY?

I ask specifically because I came across this company via social media and there are many who are running some sort of scam. I just want to know if they're a legitimate business and I won't be the victim of identity theft or the like.

0 Votes

Jackson, Mississippi

Private Lending & Conventional Mortgage Advice

Post: Interest rates are not going back to 3%

Zalman Ives

Posted February 19, 2023 12:48

Real Estate Agent
Brooklyn, NY
Posts 53
Votes 28

Quote from @Chris Seveney:

I am sure many of you will disagree with me, but I am seeing a lot of posts talk about “today’s high interest rates”

I believe there are many of us who view today’s rates to be more of the norm versus the outlier.

If you look at the current data, interest rates are not going to be dropping significantly in the near future. Could interest rates get back potentially into the 4’s, yes.

But I believe the days of the federal rate being at 0% and mortgage interest rates in the 2’s and low 3’s is not something people should bank on in the near future.

It’s not only goes for acquiring property, but for those who have invested in syndications where the exit was a refinance at a low rate.

Let the fireworks begin

Wow, Chris! I was not even thinking they would return to the 4's, never mind 2's & 3's, and certainly not in 2023 like someone else replied. But I was hoping for low 5's by the end of the year and a little more accommodating market in unconventional loans for us young guys who can't show enough income (I'm getting quotes at 11.5-14.5%, and exorbitant closing fee). As someone else mentioned, the fed is making that less likely with every rate hike.

1 Vote

General Landlording & Rental Properties

Post: Focusing on the wrong thing?

Zalman Ives

Posted February 18, 2023 20:06

Real Estate Agent
Brooklyn, NY
Posts 53
Votes 28

Quote from @Greg M.:

Quote from @John Dunn:

I'm crunching numbers on my first investment purchase and suspect I'm focusing too much on the profit margin during the first two years (low single digits). I think the margins will be between 10% (no refinance and lower interest rate) and 15% (refinance at a lower interest rate) in 5-6 years. My gut instinct is the first year margin isn't the most important thing to focus on as long the property is profitable in the first two years. Margins will improve over time since the largest expense (mortgage payments) is fixed.

What's more likely, interest rates will rise up to their historical average or that they will go down and these new low levels will be the new normal?

The new historical low of 2.65% is unlikely to return, but Freddie Mac expects the average to reach around 6% this year. The last time before Oct 2022 that the average rate hit 7% was 2002, so the current rate or higher isn't necessarily the "historical average". None of this suggests though that we should make investments now banking on the possibility of rates declining.

0 Votes

Westchester County, New York

Mortgage Brokers & Lenders