Editorial: Legislature should protect condo owners in apartment conversions [3-24-15]
Editorial Courtesy of the Tampa Bay Times
Writen by Skip O’Rourke
March 24, 2015
The best hope for condominium owners being forced out of their homes as their buildings are converted to apartments is a legislative fix. Two similar bills in the Florida House and Senate would require that owners who object to the conversation be fully compensated for their properties. While not a perfect solution, this is the most reasonable way to ensure that homeowners are not subject to the double disservice of being pushed out of their homes and given a pittance for property they do not want to sell.
The Tampa Bay Times’ Susan Taylor Martin reported last Sunday that several condo owners at Grande Oasis at Carrollwood, a Tampa condo community that is poised to convert to apartment rentals, stand to lose their homes with little recourse. A bulk buyer already has snapped up nearly 800 of the complex’s 1,000 units. Once a buyer reaches 80 percent ownership, Florida law allows that owner to vote to convert the complex to rental apartments and force the remaining condo owners to sell their units, often at a significant financial loss.
Bills filed by Rep. Chris Sprowls, R-Palm Harbor, and Sen. Jack Latvala, R-Clearwater, seek to protect homeowners from being exploited by aggressive investors. The measures (SB 1172, HB 643) would require bulk buyers to pay owners who object to condo terminations 110 percent of their unit’s purchase price or fair market value, whichever is greater. They also would require the bulk buyer to pay a relocation fee to former unit owners who had a homestead exemption on their condominium. Neither payment will extinguish owners’ anguish about an unwanted move, but the proposals present a reasonable avenue of opportunity to prevent large, unfair financial losses.
The changes could help condo owners such as Doreen Rosselli, a corporate travel counselor who bought her two-bedroom unit for $183,300 in 2006. Without the proposed protections, Rosselli likely will lose money on the sale of her home. Under current Florida law, bulk buyers would only have to pay Rosselli fair market value. According to Hillsborough County property appraiser’s records, her unit is worth about $43,000.
Some condo owners worry that the legislation contains a loophole that would allow bulk buyers to forfeit payments to condo owners if they plan to sell the property to a third party. The bills’ authors say that concern is misplaced. Still, the lawmakers should tweak their bills to eliminate any possibility of such shady dealings.
The Legislature created this problem for condo owners who have no interest in selling their properties. As more condo conversions take place around the state, lawmakers should create relief valves for owners who do not support condo terminations in their communities. Passing the changes proposed by Latvala and Sprowls would be a good place to start.