On October 17, state legislators Ed Braunstein and Toby Ann Stavisky held a press conference to announce that Governor Kathy Hochul has signed a proposal granting cooperative apartment (co-op) owners the right to renew their lease agreements early. This initiative aims to address long-standing issues concerning lease renewals in co-op communities, empowering them to proactively extend their leases before expiration.

The event was attended by several members of the Presidents Co-op & Condo Council (PCCC). Legal advisor Geoffrey Mazel highlighted that the key objective of the proposal is to alleviate banks’ concerns when providing loans. Historically, banks have been reluctant to finance properties with only a few decades left on their leases, significantly impacting co-op transactions.

Although most co-ops have automatic renewal clauses in their ground lease agreements, many ground lease holders do not allow co-op owners to activate these clauses until the final year. This has led to banks being hesitant to lend on such properties. With the new legislation, co-ops can now exercise their right to automatic renewals early, making banks more willing to lend to potential buyers and giving co-op owners greater leverage in negotiations with ground lease holders.

Warren Schreiber, co-chair of the PCCC, noted that many co-op owners, particularly those from middle-class families, have faced obstacles in selling their units or securing loans due to ground lease issues. He described the passage of this proposal as a significant victory for these families, allowing them to better manage their assets and ensure that their housing is not jeopardized by lease complications.

Bob Friedrich, president of Glen Oaks Village, shared a similar perspective, stating that the proposal not only addresses current ground lease renewal challenges but also establishes a foundation for future co-op community management. “Banks will now be more willing to lend to these cooperatives, which is a positive signal for the entire real estate market,” he remarked.

As primary advocates for the proposal, Braunstein and Stavisky emphasized its significance for co-op communities and expressed their intention to pursue further reforms in the upcoming legislative session. Congress members Grace Meng and Tom Suozzi also attended the press conference, demonstrating bipartisan support for this important initiative.