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A condop in real estate is a term for a residential establishment (building or portion of a building) that includes both a condominium and cooperative ownership structure. Typically the condop refers to the residential portion of a building which is treated as a single condominium unit owned through a cooperative ownership structure.
Condops first came into use in the 1960s and were employed by developers that wanted to divest their residential units at a time when condominiums were not yet in popular in major cities, particularly New York. The condop (as strictly defined) is still a relatively rare item in the US. For example as of 2007, New York City had fewer than 300 condop buildings as compared to more than 6,700 cooperatives and 2,300 condominiums, representing just over 3% of residential buildings.
Strict definition (Ownership)Edit
The condop is a hybrid ownership structure. Typically a condominium differs from a cooperative in that residents of a condominium directly own their apartments whereas residents in a cooperative own shares in a corporation that owns the building and a right to use a specific apartment in the building. Condops blur the distinction between the two concepts as the cooperative corporation owns, not a whole building, but just the residential condominium space within it.
Typically in a condop, the structure was used to separate the residential component from the commercial components. Often this can be advantageous for the developer or sponsor to retain ownership of the non-residential space in a building.
Common usage (Operational)Edit
The cooperative portion of the condop is effectively no different than any cooperative building that contains only residential units. However, in real estate vernacular, the term condop is often also used to refer to a cooperative that behaves like a condominium or a "co-op with condo rules". In these situations, unlike a traditional conventional cooperative, the bylaws in a condop will more closely resemble the rules of a condominium rather than a cooperative. Typically condops will set out a lower required down payment for prospective purchasers and do not include many of the restrictive measures that impact prospective purchasers of cooperative apartments. The bylaws for condops typically do not include the need for board approval to sell or sublet an apartment. Additionally, restrictions on alterations to the apartment are more consistent with condos than cooperatives.
See also Edit
- ABOUT REAL ESTATE; 'CONDOP': A NEW EAST SIDE CONVERSION. New York Times, August 24, 1984
- Considering a 'Condop'. New York Times, June 22, 1986
- ABOUT REAL ESTATE; A NEW LURE BY BUILDERS: THE CONDOP. New York Times, February 20, 1987
- Buying Land Under A Co-op. New York Times, August 9, 1992
- What Exactly Is a Condop?. New York Times, May 20, 2007
- Condop: Part Co-op, Part Condo. New York Times, March 1, 1998
- How Condops Differ From Condops. New York Times, November 27, 2005