Cooperatives & Condominiums
A NYC hybrid: legally structured as a co-op but operating with condo-like rules — typically minimal board approval and freedom to sublet.
A condop is a NYC building structured legally as a cooperative (shares + proprietary lease) but operating with condo-like rules: typically NO board approval requirement, unrestricted subletting, and no flip tax. This structure usually arises in mixed-use buildings where commercial rental income would violate the IRC §216 80/20 rule for a regular co-op (and forfeit the federal tax pass-through for shareholders). The condop structure satisfies tax requirements while allowing residential units to behave like condos. To buyers, condops look and behave like condos but technically use co-op legal documents.
Exam Tip
Structured as co-op, behaves like condo. Common in mixed-use buildings to satisfy the IRC §216 80/20 rule for tax pass-through.
Study Guide
Co-ops & Condos
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Practice
NY Real Estate Co-ops and Condos
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