Development Options for Condominium Structure: Pt 1. – The Multicondominium
If constructing two or more condominiums within the same development is of interest, a multicondominium structure may be worth considering. A multicondominium structure is often used with large development projects, mainly because this structure allows developers to continue construction after phasing deadlines expire. A multicondominium structure is often also used when a developer would like a higher density permit to build additional condominiums. Oftentimes, obtaining financing for development with multiple condominiums is much easier under a multicondominium structure, due to presale requirements.
The main advantage of a multicondominium structure is the ability to have one condominium association govern all the condominiums within a development. Florida law allows two or more condominiums to be operated by one condominium association and permits the articles of incorporation and bylaws governing the association to be recorded for the first condominium and then incorporated to all the condominiums constructed after.
There are accounting requirements that must be followed when there is only one condominium association governing separate condominiums. These requirements include, but are not limited to, the condominium association having a separate assessment method and separate accounting records.
The governing documents for a multicondominium are generally complex. The Declaration of Condominium, along with other things, must provide for the manner in which the common expenses and common surpluses will be shared among the condominiums as well as how the amenities within the condominiums will be shared. The Declaration of Condominium must also address the rules and regulations for the amenities within the condominiums.
With all development projects, we highly recommend seeking advice from an experienced real estate attorney. Here at the Moorhead Real Estate Law Group, we have the experience and expertise to advise on the best way to structure your condominium development.