Senate Bill S2967

                                 BILL NUMBER:  S2967A

 TITLE OF BILL :
An act to amend the real property law, in relation to the definition
of qualified leasehold condominiums


 PURPOSE OR GENERAL IDEA OF BILL :
To include the New York City educational construction fund ("Fund") as
an additional holder of the landlord's interest in such leasehold
interest under the definition of "Qualified Leasehold Condominium."
The bill will permit the Fund to create commercial, industrial,
residential condominium interests or mixed-use condominium interests
in leaseholds of real property controlled by the Fund.

 SUMMARY OF SPECIFIC PROVISIONS :
Section 1 of the bill amends subdivision 12 of section 339-e of the
condominium act, which is article 9-B of the Real Property Law (the
"Act"). Section 339-e includes a list of definitions of terms used in
the Act. Subdivision 12 is the definition of "qualified leasehold
condominium". The bill amends this definition to include commercial,
industrial or mixed-use including residential condominiums built on
leasehold interests in real property controlled by the Fund. This
legislation is specific to one location in the borough of Manhattan.

Section 2 of the bill provides that it shall take effect immediately.
              

 EFFECTS OF PRESENT LAW WHICH THIS BILL WOULD ALTER :
Adds new paragraph (iv) to subdivision 12 of section 339-e to the Real
Property Law.

 JUSTIFICATION :
Pursuant to the New York City Educational Construction Fund ("Fund"),
a public benefit corporation created by the State legislature in 1966,
the City of New York conveyed land to the Fund at no cost for the
development of twelve schools. The land for ten schools is being used
for combined schools and housing units and the land for two schools is
being used for combined schools and commercial buildings. The
operating revenues consist of rental revenues and tax equivalency
payments.

Currently, the non-school residential portions of the Fund projects
consist of leasehold co-ops. The Fund is not able to market these
nonschool portions as residential leasehold condominiums. The
perception of condominiums amongst the development community is that
buyers of residential units are more likely to purchase condominium
units, and are also more willing to pay higher prices for these
condominium units, as opposed to co-ops.

Allowing the Fund to market the non-school portions of its projects as
residential leasehold condominiums would broaden the appeal of its
sites and afford greater flexibility to meet changing market
conditions. This will create a more viable residential program thus
ensuring a successful continuation of the Educational Construction
Fund Program.

 PRIOR LEGISLATIVE HISTORY :
2008: A.11548/S.8559 Referred to Assembly Housing Committee. Passed
Senate.

 FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS :
None.

 EFFECTIVE DATE :
Immediately.