Sponsor Unit Owner Opportunity to Purchase Act

Drafting status. A complete bill draft with a sponsor’s memorandum. No bill number is assigned and no sponsor has agreed to carry it. Every citation was verified against a primary source on 2026-07-27; see Part V.

Read Part III before advocating for this bill. Its architectural precedent was vetoed and the veto was allowed to stand. That history is the most important fact about this draft and it is not buried.

PART I — SPONSOR’S MEMORANDUM IN SUPPORT

BILL NUMBER: to be assigned

TITLE OF BILL: An act to amend the real property law, in relation to notice to unit owners and an opportunity to purchase upon the bulk sale of units held by a sponsor or a successor in interest.

PURPOSE OR GENERAL IDEA OF BILL:

To require that when a sponsor sells a controlling block of unsold units in a single transaction, the people who already own units in that building are told before it happens and are given a defined period in which to match the offer.

SUMMARY OF PROVISIONS:

Section 1 sets out legislative findings.

Section 2 adds a new section 339-ii-3 to the real property law establishing definitions, a notice requirement, a period during which the board and then the unit owners may elect to purchase on the same terms, enumerated exemptions, an anti-circumvention rule, and remedies.

Section 3 sets a severability clause and effective date.

JUSTIFICATION:

When a condominium offering plan is declared effective, the sponsor commonly retains unsold units. Those units carry votes. Years later the retained block may be sold in a single transaction to a single buyer, who thereby acquires a voting position in a building governed on the assumption that voting power is distributed among resident owners.

The existing unit owners generally learn of this after closing. No provision of law requires that they be told beforehand.

New York has already legislated in the adjacent space. General Business Law § 352-eeee — “Conversions to cooperative or condominium ownership in the city of New York,” verified 2026-07-27 — governs conversion plans, requires a fifty-one percent purchase threshold for both eviction and non-eviction plans, gives tenants a ninety-day exclusive purchase right, and requires non-discriminatory offerings. The Legislature has therefore already decided, in the conversion context, that occupants get a defined window and defined information before ownership of their building changes hands.

This bill applies the same reasoning at the other end of the building’s life: not when a rental becomes a condominium, but when a sponsor’s residual position in an existing condominium changes hands.

The bill does not set a price. The electing party pays what the third party offered. It does not prohibit any sale. If no one elects, the sponsor sells to whomever it wishes on the terms it negotiated. What the bill requires is notice and a clock.

PRIOR LEGISLATIVE HISTORY:

New at the state level.

The architectural precedent is Council Int. 902 of 2024 of the city of New York, the Community Opportunity to Purchase Act, which addressed a different transaction — the sale of distressed multifamily rental buildings — and gave qualified non-profit organizations a first opportunity to purchase. That bill passed the Council on December 18, 2025 by a vote of thirty-one in favor, which was below the thirty-four votes required to override a veto. Mayor Eric Adams vetoed it on December 31, 2025. Council Speaker Julie Menin did not include it among the bills brought for an override vote, and the veto was allowed to stand. It did not become law. All verified 2026-07-27.

FISCAL IMPLICATIONS:

None to the state. No agency role is created. The bill operates between private parties and is enforced by the parties themselves.

EFFECTIVE DATE:

One hundred eightieth day after it shall have become a law, applicable to any transaction for which a binding agreement is entered on or after such date.

PART II — THE BILL

                           STATE OF NEW YORK
    ____________________________________________________________________

                                                    [NUMBER TO BE ASSIGNED]

                              IN SENATE / IN ASSEMBLY

    Introduced by ____ -- read twice and ordered printed, and when printed
      to be committed to the Committee on Housing, Construction and
      Community Development


    AN ACT to amend the real property law, in relation to notice and an
      opportunity to purchase upon the bulk sale of units held by a sponsor


    The People of the State of New York, represented in Senate and Assembly,
    do enact as follows:

Section 1. Legislative findings.

The Legislature finds and declares as follows:

1. Upon a condominium offering plan being declared effective, a sponsor commonly retains ownership of units that were not sold, and such units carry voting rights in the condominium.

2. The subsequent transfer of such retained units in a single transaction, or in a coordinated series of transactions, may convey to a single acquirer a voting position materially affecting the governance of the condominium.

3. Unit owners in such a condominium presently have no right to notice of such a transfer before it occurs, and no opportunity to acquire the units on the terms offered.

4. In section three hundred fifty-two-eeee of the general business law, the Legislature has recognized that occupants of a building undergoing a change in the form of its ownership are entitled to defined information and a defined period within which to act.

5. It is the purpose of this act to extend comparable notice and opportunity to unit owners upon the bulk transfer of a sponsor’s retained units.

§ 2. Amendment to the real property law.

The real property law is amended by adding a new section 339-ii-3 to read as follows:

§ 339-ii-3. Bulk transfer of sponsor units; notice and opportunity to purchase.

1. Definitions. As used in this section, “unit owner” has the meaning ascribed to it by section three hundred thirty-nine-e of this article, and:

  (a) “Covered transfer” means a transfer, or a series of transfers within any twelve-month period to the same transferee or to transferees under common control, of units in a condominium representing in the aggregate ten percent or more of the aggregate common interest, by a sponsor or a successor in interest to a sponsor.

  (b) “Bona fide offer” means a written offer from an unaffiliated third party to acquire units in a covered transfer, made in good faith and containing all material terms.

  (c) “Electing party” means the board of managers acting on behalf of the condominium, or unit owners acting pursuant to subdivision four of this section.

2. Notice required. A sponsor or successor in interest proposing a covered transfer shall, not less than one hundred twenty days before the closing of such transfer, deliver written notice to the board of managers and to each unit owner of record. Such notice shall state:

  (a) the number of units and the aggregate common interest proposed to be transferred;

  (b) the aggregate purchase price and all material terms of the bona fide offer;

  (c) the identity of the proposed transferee and of any person controlling such transferee; and

  (d) a plain statement of the rights conferred by this section and the date on which they expire.

3. Board election. Within forty-five days after delivery of the notice required by subdivision two of this section, the board of managers may deliver to the sponsor a written election to purchase the units on the same terms as the bona fide offer. An election under this subdivision shall be authorized by the vote required by the by-laws for the acquisition of real property or, if the by-laws are silent, by a majority of unit owners.

4. Unit owner election. If the board does not deliver an election within the period provided by subdivision three of this section, unit owners representing not less than twenty-five percent of the aggregate common interest may, within thirty days thereafter, deliver a written election to purchase the units on the same terms as the bona fide offer, in shares among themselves as they shall determine.

5. Closing. An electing party shall close within forty-five days after delivery of its election, or within the period provided in the bona fide offer, whichever is later. Failure to close within such period terminates all rights under this section as to that covered transfer, and the sponsor may proceed with the bona fide offer.

6. Same terms. An election under this section shall be on the same price and material terms as the bona fide offer. No electing party shall be entitled to a discount, and no sponsor shall be required to accept a lesser price or less favorable terms.

7. Exemptions. This section shall not apply to:

  (a) a transfer by devise, descent, or operation of law;

  (b) a transfer to an entity under common control with the transferor, provided that the units so transferred remain subject to this section in the hands of the transferee;

  (c) a transfer pursuant to the foreclosure of a bona fide mortgage or security interest, or a deed in lieu thereof, granted for value and not for the purpose of avoiding this section;

  (d) a transfer pursuant to an order of a court or a plan confirmed in a case under title eleven of the United States Code; or

  (e) a condominium containing fewer than twenty units.

8. Anti-circumvention. A series of transfers structured to fall below the threshold in paragraph (a) of subdivision one of this section, but which taken together would constitute a covered transfer, shall be treated as a covered transfer. The burden of demonstrating that a series of transfers was not so structured shall be on the transferor.

9. Remedies. A unit owner or the board of managers may bring an action for injunctive relief to enforce this section. Where a covered transfer has closed in violation of subdivision two of this section, the court may award damages, and the prevailing plaintiff shall be entitled to reasonable attorneys’ fees. This section shall not be construed to render void a transfer to a purchaser for value in good faith and without notice, nor to create a lien or encumbrance upon title.

10. Waiver. The rights conferred by this section may not be waived in advance, and any provision of a declaration, by-laws, or agreement purporting to waive them prospectively shall be void as against public policy. A board or unit owner may waive the rights conferred as to a specific covered transfer after notice under subdivision two has been delivered.

§ 3. Severability; effective date.

If any provision of this act is held invalid, such invalidity shall not affect any other provision. This act shall take effect on the one hundred eightieth day after it shall have become a law, and shall apply to any covered transfer for which a binding agreement is entered on or after such date.

PART III — THE PRECEDENT FAILED, AND WHAT THAT MEANS

The prior draft described its template as a bill that “survived a full committee process, a Council vote, and a hostile real-estate-industry campaign, which makes it valuable.” That framing is too kind to the precedent and it should be corrected before anyone carries this into a meeting.

What actually happened. The Community Opportunity to Purchase Act, Council Int. 902 of 2024, passed the New York City Council on December 18, 2025 with thirty-one votes — three short of the thirty-four needed to override a veto. Mayor Eric Adams vetoed it on December 31, 2025, his last day in office. Incoming Speaker Julie Menin did not bring it among the bills scheduled for an override vote, and the veto stood. All verified 2026-07-27.

Why that matters for this bill. COPA was defeated in a chamber where its supporters held a majority, against an outgoing mayor, in a city whose politics are more favorable to this kind of measure than Albany’s. A state bill that constrains transactions more broadly should not be presented as though the precedent were a success.

Three design changes follow from that history.

First, the beneficiary changed. COPA gave the opportunity to certified non-profit organizations selected from a list. The single most effective attack on it was that the list was a patronage mechanism. In this bill the opportunity runs to the building’s own unit owners and to nobody else. There is no list, no certification, no agency discretion, and no outside party. That removes the attack entirely.

Second, the third tier is gone. The prior draft added a third tier giving HPD or a designated affordability-preservation non-profit an opportunity if the owners declined. That reintroduced precisely the feature that killed COPA. It has been removed.

Third, the timeline is shorter and simpler. The prior draft proposed a 25/80/15 structure said to be “identical to COPA,” running to 120 days. That characterization of COPA’s timeline was not verified and is not repeated. This bill sets its own periods — 45 days for the board, 30 days for owners, 45 days to close — on their own merits, and states the outside notice period plainly at 120 days.

What remains hard. This bill still constrains a transaction, and the opposition to it will be real. It should be carried on the notice argument first — that owners should learn about a change in their building’s voting composition before rather than after it happens — because notice is defensible on its own even if the purchase right is negotiated away in committee.

PART IV — OPEN DRAFTING QUESTIONS

1. Cooperatives are not covered. This draft reaches condominiums only. Cooperative sponsor shares are personal property, not real property, and a right of first refusal over shares raises different questions under the Uniform Commercial Code and under the proprietary lease. The prior draft’s suggestion that a parallel cooperative rule be added is sound but is not drafted here, and the bill should not be described as covering co-ops.

2. The twenty-unit floor. Paragraph 7(e) exempts buildings under twenty units, on the reasoning that a bulk transfer in a very small building is likely a single family transaction. The number is a judgment, not a finding.

3. Ten percent may be the wrong threshold. Ten percent of common interest is enough to matter in a large building and is trivially exceeded in a small one. A threshold expressed in both a percentage and a unit count may work better.

4. Interaction with 421-a and 485-x regulatory agreements. Where retained units are subject to an affordability covenant under a tax exemption program, a transfer may already be constrained by the regulatory agreement. Whether this section should yield to those agreements is unresolved.

5. Mortgagee foreclosure. Paragraph 7(c) exempts foreclosure of a bona fide security interest. A sponsor who wishes to avoid this section could in principle pledge the units and arrange a friendly foreclosure. The “not for the purpose of avoiding this section” language is intended to reach that, but it puts a hard fact question in front of a court.

6. Financing. A board electing to purchase must find the money in ninety days. Nothing in this bill helps it do so. That is a real limitation and should be stated when the bill is discussed, not discovered afterward.

PART V — CITATION APPENDIX

Verified 2026-07-27 against the source shown.

Claims deliberately not made

Corrections made to the prior version

PATH TO PASSAGE

Choke-point analysis: the choke-point analysis. In the 2025 session 16,794 bills were introduced and roughly 800 reached the Governor — about 4.8%. Verified 2026-07-27.

Route: hold. This is the weakest bill in the set and it should not be carried first.

Be honest about the position. Council Int. 902 passed with 31 of the 34 votes needed to survive a veto, was vetoed on 2025-12-31, and the Speaker declined to bring an override. Verified 2026-07-27. That happened in a city whose politics are more favorable to this measure than Albany’s.

Carry the notice half first. The right move is to sever the bill: the 120-day notice requirement in section 2 of the new section is defensible on its own — owners should learn that their building’s voting composition is changing before rather than after it happens — and it does not constrain any transaction. The purchase right can follow once the notice provision is law.

Fiscal exposure: none. No office, no appropriation, no agency role — the bill operates between private parties. That is worth saying early, because it means the Finance referral that killed the ombudsperson bills nine times over does not apply here. The obstacle is political, not fiscal, and pretending otherwise wastes the one advantage this draft has.

Do not lead any relationship with this bill. It is the one most likely to produce a no, and a no on the first ask makes the second ask harder.

Related: LEGISLATIVE_MODEL.md · solution S18 in 01_Database/condoscoop.db · condo-coop-fraud-prevention-and-recovery-act.md