THIS IS AN EVICTION PLAN.
SEE PAGES 30 - 36.
NON-PURCHASING TENANTS OTHER THAN ELIGIBLE
SENIOR CITIZENS
AND ELIGIBLE DISABLED
PERSONS MAY BE EVICTED
BY THE
SPONSOR AFTER THE
TERMINATION OF THEIR APPLICABLE LEASE TERMS
CONDOMINIUM OFFERING
PLAN
SMALLWOOD SQUARE
CONDOMINIUM
419-471 Burroughs
Drive
Amherst, New York 14226
32 Residential Units and 20 Garage Units
Total amount of offering: $2,009,800.00
Working Capital Fund to be
retained
by the condominium: $1,680.00
(Two months estimated common charges per
Residential Unit
for the
first building sold. This fund will
increase as additional units in additional buildings are sold.)
SPONSOR AND Burroughs Drive Apartments, Inc.
SELLING AGENT: 12870 Williston Road
East
Aurora, New York 14052
Date of Acceptance
for Filing: _______________, 1995. This
plan may not be used after _________________, 1996 unless extended by
amendment.
SEE PAGE vii FOR
SPECIAL RISKS TO PURCHASERS.
HIS OFFERING PLAN
IS THE ENTIRE OFFER TO SELL THESE CONDOMINIUM UNITS. NEW YORK LAW REQUIRES THE SPONSOR TO DISCLOSE ALL MATERIAL
INFORMATION IN THIS PLAN AND TO FILE THIS PLAN WITS THE NEW YORK STATE
DEPARTMENT OF LAW PRIOR TO SELLING OR OFFERING TO SELL ANY CONDOMINIUM
UNIT. FILING WITH THE DEPARTMENT OF LAW
DOES NOT MEAN THAT THE DEPARTMENT OR ANY OTHER GOVERNMENT AGENCY HAS APPROVED
THIS OFFERING.
TABLE OF CONTENTS
PART
I
PAGE
SPECIAL RISKS . vii
ELECTION FORMS FOR ELIGIBLE SENIOR
CITIZENS AND
ELIGIBLE DISABLED PERSONS viii
INTRODUCTION 1
Purpose
of Offering Plan 1
Number
and Types of Units 1
Parking
Lot 2
Aspects
of Condominium Ownership 2
Limited
Common Elements 3
Payment
of Common Charges 4
Compliance
With Declaration, By-Laws, Rules and
Regulations 5
Restrictions
on Use, Resale, Leasing or Mortgaging 5
The
Board of Managers 6
Taxation
and Mortgaging of Units 6
Responsibility
for Maintenance and Repairs 7
Insurance
Coverage 7
No
Unit Subject to Rent Regulatory Laws 8
Purchasing
Information 8
LOCATION AND AREA INFORMATION 9
TransportatIon 9
Shopping 9
Recreational 9
Medical 9
Religious 9
Educational 9
Services 10
Zoning 10
OFFERING PRICES AND RELATED INFORMATION 10
Schedule
A 11
ESTIMATED BUDGET FOR FIRST YEAR OF
CONDOMINIUM OPERATION. 14 (Schedule B)
Schedule
B-l - Projected Budget for Individual
Unit
Energy
costs 20
COMPLIANCE WITH REAL PROPERTY LAW SECTION
339(i) 22
TABLE
OF CONTENTS (continued)
PAGE
CHANGES IN PRICES AND UNITS 24
ACCOUNTANT' S CERTIFIED STATEMENTS OF
OPERATION 25
RIGHTS OF ELIGIBLE SENIOR CITIZENS AND
ELIGIBLE
DISABLED PERSONS 28
RIGHTS OF EXISTING TENANTS 30
OBLIGATIONS OF OWNERS OF DWELLING UNITS
OCCUPIED
BY NON-PURCHASING TENANTS 34
INTERIM LEASES 36
PROCEDURE TO PURCHASE 37
Trust
Funds 37
Payments 38
Escrow
Agent 38
Escrow
Agreement 38
Liquidated
Damages 40
Sponsor
to Fix Closing Date 40
Form
Power of Attorney 41
Purchaser
Time to Review Offering Plan
and Amendments 41
Risk
of Loss 41
Financing
Contingency 41
Conflicts 42
Sponsor
Acceptance of Purchase Agreement 42
ASSIGNMENT OF PURCHASE AGREEMENTS 43
EFFECTIVE DATE OF PLAN 43
TERMS
OF SALE 44
Unit
Deed 44
Casualty
Damages Prior to Closing 45
Title 45
Personal
Property 46
Declaration,
By-Laws and Floor Plans 46
Real
Property Transfer Gains Tax 46
Existing
Mortgages 47
UNIT CLOSING COSTS AND ADJUSTMENTS 47
Sponsor's
Costs 47
Purchaser's
Costs 47
ii
TABLE
OF CONTENTS (continued)
PAGE
Transfer
of Certain Statutory Costs Obligations
to Purchaser 50
Reimbursement
to Sponsor for Mortgage Tax Credit . . 50
Possible
Sponsor Escrow of Real Estate Taxes . . . . 50
RIGHTS AND OBLIGATIONS OF THE SPONSOR 51
No
Obligation to Defend Suits or Indemnify 51
Certain
Obligations Survive Delivery of Unit Deed. . 51
Payment
of Common Charges, Special Assessments
and Real Estate Taxes 51
Sponsor
Controlled Board of Managers to Maintain
Property 51
Obligation
to Repair Casualty Damage 51
Procure
Fire and Casualty Insurance 52
Dissolution
or Liquidation of Sponsor 52
Property
Sold "As Is" 52
Keep
Copies of Plan and Documents on File 52
Reserved
Easements and Rights of Access 52
Construction
of 20 Garage Units 53
Leasing
Units 53
CONTROL BY THE SPONSOR 53
Veto
Power 54
BOARD OF MANAGERS 55
Number
and Composition of Board of Managers 55
Eligibility 55
Elections 56
Meetings
of Board of Managers 56
Meetings
of the Unit Owners 57
Members
of Board of Managers 57
Identity
of First Officers of Board of Managers
of Condominium 57
Liability
of Board of Managers 57
No
Compensation 57
Removal
of Officers and Members of the Board . . . . 58
Computation
of Unit Owners' Voting Rights 58
Percentage
of Common Interest Needed to Amend
By-Laws and Declaration 58
RIGHTS AND OBLIGATIONS OF UNIT OWNERS AND
BOARD OF MANAGERS 59
Sale
or Lease of Units by Unit Owners 59
No
Right of First Refusal 59
Mortgaging
of Units by Unit Owners 59
iii
TABLE
OF CONTENTS (continued)
PAGE
Common
Charges and Assessments 59
Repairs.
. . . . 61
Additions,
Alterations and Improvements 62
Insurance 64
Restrictions
on Occupancy and Use 65
REAL ESTATE TAXES 68
Units
Separately Assessed 68
Method
of Determining Real Estate Tax Assessments. . 69
Known
or Tentative Changes in the Assessed
Valuation or Tax Rates 69
Tax
Certiorari Proceedings 69
Tax
Exemption and Abatement Benefits 70
OPINION OF COUNSEL 71
RESERVE
FUND 74
WORKING CAPITAL FUND 75
MANAGEMENT AGREEMENT, CONTRACT AND LEASES 75
IDENTITY OF PARTIES 76
Sponsor 76
Sponsor's
Attorney 76
Managing
Agent 76
Selling
Agent 76
Professional
Engineer 76
Relationship
Between Sponsor or its Principals
and the Parties 77
Designation
of Secretary of State 77
SPONSOR'S PROFIT 77
REPORTS TO UNIT OWNERS 77
DOCUMENTS ON FILE 78
GENERAL 78
Lawsuits 78
Prior
Offerings 78
No
Discrimination 78
Special
Purchaser Rights 78
Special
Circumstances Affecting Use or Enjoyment
of the Property 79
iv
TABLE
OF CONTENTS (continued)
PAGE
RESERVATION OF DEVELOPMENTAL RIGHTS 79
SPONSOR'S STATEMENT OF BUILDING CONDITION 79
v
TABLE
OF CONTENTS (continued)
PAGE
PART
II
PURCHASE AGREEMENT 81
POWER OF ATTORNEY 93
FORM ESCROW AGREEMENT BETWEEN SPONSOR AND
CLOSING ATTORNEY 98
FORM OF UNIT DEED 106
DESCRIPTION OF PROPERTY AND BUILDING
CONDITION 108
FLOOR PLANS 127
SURVEY 132
SITE PLAN 133
ASBESTOS REPORT 134
DECLARATION OF CONDOMINIUM 136
CONDOMINIUM BY-LAWS 171
PART 23.8 ELIGIBLE SENIOR CITIZENS AND
ELIGIBLE
DISABLED PERSONS 216
CERTIFICATIONS
Sponsor and Principals 219
Sponsor's Engineer 221
Sponsor's Expert Concerning Adequacy of
Budget . . . 223
vi
SPECIAL
RISKS
I. Purchaser to Pay Real Estate Transfer
Tax (i - e. deed stamps)
The form Purchase Agreement
(Paragraph 4) requires the purchaser of a Unit to reimburse Sponsor at closing
for the real estate transfer tax imposed by Article 31 of the New York Tax Law
(i.e. deed stamps). See Page 50 of the
Offering Plan.
2. All Units Sold 'As Is'
All of the Units are offered in
their "as is" condition without warranty of any kind. The New York State Statutory Warranty
applies only to newly constructed housing and does not apply to the sale of
existing housing such as the condominium units in the Smallwood Square
Condominium.
3. Unit Layouts and Dimensions
The Purchaser of a Unit agrees to
purchase the Unit whether or not any layout or room dimensions of the Unit or
any part thereof, or of the common elements, as shown on the floor plans set
forth in the Offering Plan, is accurate or correct provided that the layouts
and room dimensions of the Unit conform substantially to the floor plans.
vii
ELIGIBLE ELECTION FORMS FOR ELIGIBLE
SENIOR
CITIZENS AND ELIGIBLE DISABLED
PERSONS
SEE INSTRUCTION SHEET ON NEXT PAGE
BEFORE COMPLETING THIS FORM
SENIOR
CITIZEN ELECTION FORM*
*For use in eviction plans in New
York City, and municipalities in New York State which have adopted GBL Section
352-e(2-a).
NAME:
ADDRESS:___________________________________
APT. ___
I elect not to purchase my apartment
under the Offering Plan for conversion of the building to a cooperative or
condominium.
I certify that:
I. I am a tenant of the apartment listed above.
2. I or my spouse was 62 years of age or older on
the date the Department of Law accepted the Offering Plan for filing.
I understand that this senior
citizen election does not preclude me from purchasing my apartment at a later
date.
The above statements are true to the
best of my knowledge and understanding.
SIGNED:____________________________
Sworn to before me
this
____ day of
________________, 19
Notary Public
Receipt
acknowledged and copy given to tenant.
SPONSOR/AGENT:_________________________
DATED:____________
viii
INSTRUCTION FOR COMPLETING SENIOR
CITIZEN ELECTION FORM
State law provides that tenants who
are "eligible senior citizens" cannot be evicted because they did not
buy their apartments.
TO QUALIFY AS AN "ELIGIBLE SENIOR
CITIZEN", (1) you must be a tenant, or the spouse of a tenant; and (2) you
must have been 62 years of age or older on the date the Department of Law
"accepted the Offering Plan for filing"; and (3) you must complete
this election form and return it to the Sponsor within 60 days of the date you
first received the Offering Plan.
Who Is Considered A Tenant?
A tenant for purposes of this form
is a person who has signed a lease or, the husband or wife of a person who has
signed a lease.
Date OfferinG Plan Was Accepted For
Filing
The approximate date the Department
of Law "accepted the Offering Plan for filing" is printed on the
front cover of the Offering Plan. You
must have been 62 years of age or older on the filing date to qualify.
Return This Form Within 60 Days
You must complete and return this
form within 60 days of the date you first received the Offering Plan. Return the form either by delivering it to
the Sponsor or the Sponsor's selling agent at the location specified in the
Plan, or by mailing it by certified or registered mail, return receipt
requested, to the Sponsor or selling agent at the address specified in the
Plan.
WARNING: FAILURE TO RETURN THIS FORM
WITHIN 60 DAYS COULD ULTIMATELY RESULT IN YOUR BEING EVICTED
- Be sure to sign the form before a Notary Public -
The Sponsor May Dispute Your Eligibility
The law allows the Sponsor to
dispute your eligibility as an "eligible senior citizen". In order to do so, the Sponsor must apply to
the Department of Law for an eligibility determination within 30 days after the
Sponsor receives your election form. In
case of a dispute, the Department of Law has 30 days to determine your
eligibility. If your eligibility is
disputed, you will be notified by the Department of Law and give the
opportunity to defend your eligibility.
ix
SEE INSTRUCTION SHEET ON NEXT PAGE BEFORE
COMPLETING THIS FORM
DISABLED PERSON ELECTION FORM
For use in New York City which is
subject to GBL Section 352-eeee, and for use in municipalities in Nassau,
Rockland and Westchester Counties which have adopted GBL Section 352-eee, and
to use in municipalities in the State of New York which have adopted GBL
Section 352-e(2-a).
NAME:
ADDRESS: APT. ___
I elect not to purchase my apartment
under the Offering Plan for conversion of the building to a cooperative or
condominium.
I certify that:
1. I am a tenant of the apartment listed above.
2. I have an impairment which results from
anatomical, physiological or psychological conditions (other than an addiction
to alcohol, gambling or any controlled substance) which (1) is demonstrable by
medically acceptable clinical and laboratory diagnostic techniques; (2) is
expected to be permanent; and (3) prevents me from engaging in any substantial
gainful employment.
I understand that this disabled
person election does not preclude me from purchasing my apartment at a later
date.
The above statements are true to the
best of my knowledge and understanding.
SIGNED:_________________________
Sworn to before me
this
_____ day of _________________, 19
Notary Public Receipt acknowledged, and copy given to
tenant.
SPONSOR/AGENT:____________________________
DATE:_____________
x
INSTRUCTIONS
FOR COMPLETING DISABLED PERSON ELECTION FORM
State law provides that tenants who
are "ELIGIBLE DISABLED PERSONS" cannot be evicted because they did
not purchase their apartments.
To qualify as an "ELIGIBLE
DISABLED PERSON", (1) You must be a tenant; (2) you must have a disability
as defined on the in this form; and (3) you must complete this form and return
it to the Sponsor within 60 days.
Who Is Considered A Tenant?
A tenant for purposes of this form
is a person who has signed a lease or, the husband or wife of a person who has
signed a lease.
This Form Must Be Returned To The
Sponsor
If you were disabled when you first
received the Offering Plan, you must complete and return this form to the
Sponsor not more than 60 days later.
However, if your disability first occurred after you received the
Offering Plan, then this election may be made up to 60 days after the
disability first occurred (unless after the first 60 days but before your election
the Sponsor has accepted a written agreement to purchase your apartment from a
"bona fide" purchaser).
Return the form either by delivering
it to the Sponsor or the Sponsor's selling agent at the location specified in
the Plan, or by mailing it by certified or registered mail, return receipt
requested, to the Sponsor or selling agent at the address specified in the
Plan.
WARNING: FAILURE TO
RETURN THIS FORM
WITHIN 60 DAYS COULD
ULTIMATELY RESULT IN YOUR BEING EVICTED
- Be sure to sign the form before a Notary Public -
The Sponsor May Dispute Your Eligibility
The law allows the Sponsor to
dispute your eligibility as an "eligible disabled person". In order to do so, the Sponsor must apply to
the Department of Law for an eligibility determination within 30 days after the
Sponsor receives your election form. In
case of a dispute, the Department of Law has 30 days to determine your
eligibility. If your eligibility is
disputed, you will be notified by the Department of Law and given the
opportunity to defend your eligibility.
xi
INTRODUCTION
Purpose of Offering Plan
The purpose of this
Offering Plan is to set forth all of the material terms of the offer. This Offering Plan may be amended from time
to time when an amendment is filed with the New York State Department of
Law. All amendments will be served on
(i) one residential tenant per Unit; (ii) purchasers who have executed and
delivered purchase agreements to the Sponsor or selling agent and are not in
default; and (iii) the Unit owners either by personal delivery or by mailing by
regular mail or registered or certified mail with or without return receipt
requested, addressed to the offeree or, if the offeree is provided written
information of an alternative address for notices, addressed to the offeree at
the alternative address. If the Sponsor
has no information of the last known residence address, but has written
information of the place of business or employment of such offeree, the mailing
shall be addressed to such last business or employment address.
The
Condominium is subject to and will comply with the provisions of Article 9-B of
the Real Property Law of the State of New York (the New York Condominium Act)
upon or prior to the first Unit closing.
The
Sponsor of this offering is Burroughs Drive
Apartments, Inc. The Sponsor acquired the property that is the
subject of this offering on May 4, 1994.
Number and Types of Units
There
are thirty-two (32) residential dwelling Units (the "Residential
Units") in four (4) buildings. All
Residential Units contain two bedrooms, living room, kitchen, dining room and
bathroom. All Residential Units are
offered in their "as is" condition. Most if not all of the Residential Units are currently occupied by
tenants. (See page 30 of a discussion
of the rights of existing tenants.) Purchasers are referred to Schedule A of
this Offering Plan at page Il for sale prices of the Units.
There
are twenty (20) Garage Units (the "Garage Units") in three (3)
buildings. The Garage Units will be
offered to purchasers of Residential Units on a "first come - first
served" basis. Purchasers will be
limited to one (I) Garage Unit for each Residential Unit purchased, except that
if any Garage Units remain unsold after purchase agreements have been executed
for all of the Residential Units in the Condominium, or if the Sponsor
otherwise voluntarily ceases sales of Residential Units in the Condominium, the
Sponsor may offer remaining Garage Units to owners or purchasers of existing
Residential Units again on a "first come -first served" basis.
Parking Lot
The
parking lot will contain a minimum of forty-four (44) outdoor parking
spaces. Use of the parking lot will be
subject to the rules and regulations that may be promulgated by the Board of
Managers from time to time. There is no
initial assignment of specific parking spaces to specific Residential Units,
although the Sponsor or Board of Managers will have the right to make such
assignments in the future. Every
Residential Unit shall be entitled to the use of at least one parking
space. The right of each Residential
Unit to use at least one parking space shall automatically be transferred with
the Unit and cannot be sold, alienated or otherwise conveyed by the owner of
that Unit separate from the sale or conveyance of the Unit itself.
Aspects of Condominium Ownership
Each
purchaser will own his or her Unit outright and will be entitled to exclusive
possession of that Unit together with an interest in and right to use of the
common elements, and, as applicable, to use limited common elements. However, these rights to use the common
elements are subject to the rights to all of the other Condominium Unit owners
and reserved rights of the Board of Managers of the Condominium and reserved
rights of the Sponsor. See Article VII of the Condominium Declaration in
Section II of the offering plan.
Ownership of Condominium Unit is in some respect similar to the ownership
of a private home. For example, each
Unit owner has the exclusive right to possession of his or her Unit, can freely
mortgage the Unit and can lease the Unit (subject to the provisions of Section
9.01 of the By-Laws). There are also
significant differences. There are
rules and regulations for the benefit of the preservation of the lifestyle of
all Unit owners which are contained in the Declaration, By-Laws and Regulations
and are summarized in the front part of this Offering Plan as well.
The
Residential "Unit" itself consists of the horizontal area from the
inside faces of the drywall of the Units to the unexposed faces of the drywall
at the walls, dividing the Residential Units from interior stairways or other
Residential Units and the vertical area from the lower surface of the
subflooring forming the floor of the Unit up to the upper face of the drywall
or plaster forming the highest ceiling of the Unit. The "Garage Unit" itself consists of the horizontal
area (from rear to front) from the interior surface of wood studs forming the
rear wall to the interior surface of wood studs, pilasters and headers forming
the front wall, and from side to side from the interior surface of metal studs
forming one side wall across to the interior surface of studs forming the
opposite side wall. The garage door,
including all mechanical parts and hardware, shall be part of the Garage
Unit. Each Garage Unit shall be
measured vertically from the lower surface of the concrete forming the floor of
the garage up the interior surface of the plywood sheeting and stud rafters
forming the roof of the garage.
2
The method of
calculating the Unit area is set forth in Section 4.03 of the Declaration in
Part II of this Offering Plan. Doors, windows and interior walls which abut a
unit are part of the Unit. All pipes,
wires, and conduits from gas and electric meters to the Units which service
only such Unit are part of that Unit. All hot water heaters, furnaces, air
conditioners, including duct work and pipes, which service only one Unit are
part of that Unit. Each Unit owner also owns an undivided interest in the
common elements which consist of all portions of the Condominium property other
than the Units. Schedule A contains a
listing of the percentage of common elements appurtenant to each respective
Unit. Because the common elements consist of all of the property except the
Units, they include, without limitation, the following:
A. All land within the boundaries of the
Condominium property;
B. The foundations, columns, girders, beams and
supports of the buildings;
C. All exterior and perimeter walls (but not
drywall) of the Units; hallways, porches and decks (which are limited common
elements - see below); the entrances and exits of the buildings;
D. All utility or other pipes, wires, conduits and
other material which are not part of the Units i.e. which service two or more
Units and are not owned by public utility companies or independent authorities;
E. The parking areas, grass areas, sidewalks, open
space or landscaped areas; and
F. All other apparatus or installations on the
property of any kind for common use or which may be necessary or convenient to
the existence, maintenance or safety of the common elements or two or more of
the Units.
Limited Common Elements
Certain portions of the
property are common elements but are limited in use to the owners of specific
units or to specific groups of Units.
The limited common elements in this Condominium are as follows:
A. Basement storage areas - each building contains
eight (8) enclosed storage areas. The
storage areas in each basement are limited in use only to those owners and
occupants of the respective building.
Storage areas have been assigned as set forth in the basement floor
plans on Pages 129-130 of this Offering Plan.
The storage area
3
number shown on the floor plan indicates the
Unit the storage area is assigned to.
B. Basement areas - The basement areas of each
building are limited in use to only those owners and occupants of the
respective building.
C. Parking spaces - Parking spaces are designated
as limited common elements for the purpose of allowing the Sponsor or the
Board, if it desires, to assign specific parking spaces to the use of specific
Units. Each Unit must have the use of
at least one parking space. Initial
assignments of parking spaces to specific Units have not been made as of the
date of this Offering Plan.
D. Porches and Decks - Each first floor porch is
limited in use to the Unit immediately appurtenant to the respective
porch. This does not include the common
entry way leading into the building.
Each second floor deck is limited in use to the owner of the Unit
immediately appurtenant to that second floor deck.
E. Mailboxes - each mailbox servicing a Unit is
limited in use to that Unit. Mailboxes
will be assigned to each Unit.
F. Laundry Hook-ups - Each basement contains four
hook-ups for washer and dryers.
Currently, two sets of hook-ups in each basement are used by the coin-operated
washers and dryers. The Board of
managers or the Sponsor shall have the right to assign the remaining (two) sets
of hook-ups in each basement to Unit Owners.
The respective Unit Owners (who have been assigned the right to use the
hook-up) will be required to pay a charge to the Condominium to defray the cost
of hot water and electric usage, because the basement hook-ups are connected to
the common house meters.
Pavement of Common
Charges
Each Unit owner is
required to pay the common charges assessed against that owner , 5 Unit. The Sponsor has reserved the right to not
commence the collection of common charges until at least fifty percent (50%)
of the Residential Units have closed. The Sponsor may commence the collection
of common charges prior to that time upon at least thirty (30) days notice to
the Unit owners. Pursuant to Section 339-m of the New York Condominium Act, the
Board of Managers will assess every Unit owner common charges in proportion to
the interest in the common elements appurtenant to the Unit owned for the
operating costs of the property.
Schedule B provides an estimate of the operating costs of the
Condominium
4
property and the
projected associated costs of operating the Condominium association for the
projected first year of operations. Schedule A indicates what the projected
common charges will be for each Unit based upon the budget figures set forth in
Schedule B. The obligation of the Unit owner to pay common charges is automatic
and cannot be waived by the Unit owner limiting his or her own use of the
common elements or for any other reason.
Delay or failure of the Board of Managers to provide maintenance or
other services with respect to a Unit will not be a defense for the non-payment
of common charges by that Unit owner.
Compliance With
Declaration. By-Laws. Rules and Regulations
Every Unit owner is
obligated to comply with the Condominium Declaration including the by-laws and
rules and regulations which are an attachment to the Declaration. The Declaration, By-Laws and Rules and
Regulations are set forth in full in Part II of this Offering Plan and should
be reviewed by every prospective Unit purchaser.
Restrictions on
Use, Resale, Leasing or Mortgaging
There are no restrictions
on the resale or mortgaging of any of the individual Units. Most if not all of the Residential Units are
subject to existing leases. Any Unit
subsequently leased (i.e. after that Unit has been vacated by the tenant
occupying it at the time of recording of the Declaration) will be subject to
the requirement that the lease form be approved by the Board of Managers of the
Condominium and that the lease term be for no less than six (6) months, except
that the Sponsor shall not be so restricted in the making of leases or rental
agreements with respect to the Units it owns.
The lease form used must contain a provision that the tenant is
responsible to comply with all of the provisions of the Declaration, By-Laws and
Rules and Regulations, as the same may be amended from time to time and that
violation of their provisions is an event of default or breach of the lease for
which the lease may be terminated. The
lease must further provide that the tenant will also be directly responsible to
the Board of Managers for the payment of any fine due to violations of the
terms of the Declaration, By-Laws or Rules and Regulations and for the payment
of enforcement costs, including attorney's fees. The Unit owner will also be jointly and severally liable for any
such fines, penalties or costs assessed against the tenant by the Board of
Managers or against the Unit by reason of actions of the tenant. All
Residential Units shall be used for single-family residence purposes only,
except that only the following business uses will also be permitted: (i)
leasing of the Unit by the owner thereof to other persons for residential use;
(ii) the maintenance of a professional or other business office which does not
involve the consultation with clients or customers at the Unit or the delivery
of supplies or materials to or from the Unit in such manner or volume which in
the sole discretion of the Board of Managers is a source of annoyance or
danger to other Unit owners. These
restrictions and limitations are more restrictive as to Unit owners
5
than they are to
the Sponsor. The Sponsor has
specifically reserved the right to maintain a model and sales office and to
reserve other rights for sales, marketing, remodeling, upgrading and
refurbishing of Units and/or construction or marketing and development of the
garage area. Additionally, each
Residential Unit may be resided in by no more persons (including children) than
two times the number of bedrooms.
Additionally, unless determined to be illegal, if the Residential Unit
is resided in by three (3) or more persons, such persons shall be members of
the same family (see By-Laws section 7.05).
Each Garage Unit shall
be used for the parking of automobiles and other motor vehicles and for the
storage of personal property and household items, except that such storage or
other use shall not be such as to preclude the parking of an automobile unless
the owner (or other occupant of the Garage Unit) does not own or otherwise
control an automobile on the Condominium property. Any other use is strictly prohibited, including, but not limited
to, use as a workshop or office.
The Board of
Managers
The Condominium will be
managed by its Board of Managers. An extensive discussion of the Board of
Managers is set forth on pages 55-58 of the Offering Plan. The initial Board of Managers will be
appointed by the Sponsor. The Unit
owners other than the Sponsor will have the right to elect two (2) independent
members of the Board of Managers upon the earlier of the closing of sale
of Units constituting SosE or more of common interests in the Condominium or
two years after the closing of sale of the first Unit in the Condominium. The Sponsor shall continue to have the right
to select one member of the Board of Managers so long as it continues to own
Units constituting 10% or more of common interests in the Condominium. The Sponsor will continue to reserve
extensive veto rights and easement and development rights all as set forth more
fully on pages 51-55 of the offering Plan.
Taxation and
Mortgaging of Units
Each Unit will be taxed
as a separate tax lot for real estate tax purposes and the Unit owner will
incur no tax liability if the owners of other Units fail to pay their
taxes. The assessor of the Town of
Amherst has assigned proposed tax account numbers for each Unit. These proposed tax account numbers are
listed on Schedule B to the Condominium Declaration in Part II of this Offering
Plan. The Sponsor plans to obtain separate
tax assessments from the Town of Amherst prior to the first Unit closing and
therefore does plan to hold a tax escrow.
Section 339-y of the Real Property Law specifically provides for
separate assessment and taxation of each Condominium Unit.
As discussed earlier,
each Condominium Unit may be separately mortgaged by the Unit owner without
restriction by either the Sponsor or the Board of Managers.
6
Responsibility for
Maintenance and Repairs
Each Unit owner is
responsible to maintain and repair their own Unit, including window units
(including all glass breakage), all doors and door assemblies (including garage
doors together with mechanical parts and hardware) leading to the Unit (except
that painting of the exterior trim surface of windows and doors which open from
a Unit shall be the responsibility of the Board of Managers), and maintenance
and repairs to pipes, wires and conduits which service only one Unit shall be
made by the respective owner of that Unit.
Unit owners must also keep any deck -or ~h appurtenant to their
own residential Unit in a neat and Eclean condition, but are not obligated to
maintain and repair the deck or ~h.
However, any upgrade or enhancement of the deck or porch by the Unit
owner (which the Unit owner is reminded will require Board approval) shall not
be the responsibility of the Condominium to maintain and shall be the
responsibility of the Unit owner.
Insurance Coverage
The Board of Managers
will obtain casualty and liability insurance covering the common elements of
the Condominium. Fire and casualty
insurance will cover the buildings and the Units as initially sold and include
all machinery servicing the Units and common facilities, wall to wall
carpeting, lighting fixtures, bathroom fixtures, kitchen appliances, wall
coverings (including paint) in the Unit as initially sold but excluding
the land, foundations, and the personal property of Unit owners and occupants
in the Unit. (See more complete
discussion of insurance on pages 64-65 of this Offering Plan). The Board of Managers will not obtain
casualty or liability insurance for the individual Units. The Sponsor therefore
suggests that Unit purchasers discuss with their insurance agent the following
coverages:
A. Fire and casualty insurance - to cover:
1. Any
replacement or upgrading of equipment in the Unit which is of better quality,
larger or more costly than the standard equipment in the Unit as initially
sold;
2. Any
fixtures installed or improvements made to the Unit by the Unit owner which are
not replacements of the items in the Unit at the
time the
Unit was initially offered for sale;
3. Personal
property of the Unit owner.
B. Liability insurance - to cover occurrences
within the Unit or within any common elements restricted or limited in use to
the Unit owner.
7
No Unit Subject to
Rent Regulatory Laws
None
of the Units offered in this Condominium are subject to rent regulatory laws.
Purchasing
Information
Schedule
A of the Offering Plan contains the sale prices for the Units. Tenants will have an exclusive ninety day
period in which to purchase the Residential Units they occupy at the same price
offered to non-tenants. There will be
no increases in prices during this exclusive period for any of the tenants.
The
offering prices for the Residential Units set forth on Schedule A is
conditioned on the purchase of the respective Unit in its "as is"
condition. The purchase price includes
the heating, air conditioning, hot water tank, dishwasher, stove and refrigerator
in the respective Unit which are also offered in their "as is"
condition without warranty of any kind.
Any
non-purchasing tenant may be evicted after the expiration of that tenant's
lease term, except that all bona fide tenants in occupancy on the date the
Offering Plan is accepted for filing will have the exclusive right to purchase
their dwelling unit for ninety (90) days after the Plan is presented and
therefore could not be evicted during that period of time. All prospective purchasers and tenants are
referred to pages 30-34 of this Offering Plan which explains the rights of
purchasing and non-purchasing tenants.
This
Offering Plan delivered to tenants and prospective purchasers contains all of
the material terms of the transaction. Copies of the Offering Plan, all
documents referred to in the Offering Plan and all exhibits submitted to the
New York State Department of Law in connection with the filing of the Offering
Plan will be available for inspection without charge and for copying at a
reasonable charge to prospective purchasers and their attorneys at the office
of the Sponsor/Selling Agent.
There
are no limitations on who may purchase the Residential Units, except that
Sponsor reserves the right to limit or refuse sales to purchasers who do not
intend to occupy the Unit purchased.
THE
PURCHASE OF A CONDOMINIUM UNIT HAS MANY SIGNIFICATE LEGAL AND FINANCIAL
CONSEQUENCES. THE ATTORNEY G STRONGLY
URGES YOU TO THIS OFFERING PLAN CAREFULLY AND TO CONSuLT
WITH
ATTORNEY BEFORE SIGNING A PURCHASE AGREEMENT.
8
LOCATION AND AREA INFORMATION
The Smallwood Square
Condominium (the "Property") is located on the east side of Burroughs
Drive adjacent to the 1-290, Town of Amherst, County of Erie, State of New
York. The post office address for the
property is known as 419-471 Burroughs Drive, Amherst, New York 14226.
Transportation
The Smallwood Square
Condominium is within .5 miles of an entrance to the New York State
Thruway. The Property is approximately
3 miles from the Niagara Frontier Transportation Authority (NFTA) Rapid Transit
with service to downtown Buffalo. Bus service is available (provided by NFTA),
approximately 1 mile away on Main Street.
The Greater Buffalo International Airport is approximately 6 miles from
the Property.
Shopping
Neighborhood shopping
(pharmacy, convenience food stores, banks, restaurants, gas stations, etc.) is
within approximately .2 miles of the Property to the northwest at the
Sheridan-Harlem Plaza. Regional
shopping facilities are provided by the Boulevard Mall located approximately
2.5 miles west of the Property on Niagara Falls Boulevard. The Northtown Plaza is approximately 2 miles
to the west on Sheridan Drive.
Recreational
Glen Park and Island
Park are both located approximately .5 miles away in the Village of
Williamsville. The Amherst Recreational
Center is approximately 2.5 miles away off of Amherst Manor Drive. Both the Audubon Public Golf Course (Maple
Road) and the Grover Cleveland Public Golf Course (Main Street) are within 2
miles of the property.
Medical
Millard Fillmore
Suburban Hospital is located approximately 3.8 miles northeast of the Property
on Maple Road, Amherst, New York.
Religious
Houses of worship
representing various denominations are located within 1 - 2 miles of the
Property.
Educational
The Property is located
in the Amherst Central School
District. Public
schools which service the area are Amherst Central High School, Amherst Middle
School and Smallwood Drive
9
Elementary
School. Colleges and universities
within 4 miles of the Property include Daemen College (1.5 miles - Main
Street), Erie Community College (4 miles - Main Street), and the State
University of New York at Buffalo - Amherst Campus (2 miles - Maple Road). (The
Sponsor makes no representations that anyone residing on the property can be
enrolled in any such schools.)
Services
Police protection for
the complex is provided by the Town of Amherst Police Department. Fire protection is provided by the Snyder
Fire Department. Water service is
provided by the Erie County Water Authority and the Town of Amherst Water
Department metered through "house" meters, the cost of which will be
billed to the Board of Managers and paid as a common expense. Sanitation and trash removal is provided by
Browning Ferris Industries (once a week).
Unit owners must place their garbage in one or two dumpsters provided by
the contractor on site. The cost of
trash removal will be billed to the Board of Managers and paid as a common
expense. Snow removal and road
maintenance of Burroughs Drive is provided by the Town of Amherst Highway
Department.
Zoning
The Condominium site is
zoned MFR-5 under the Town of Amherst zoning ordinance. This zoning designation allows the following
uses, which uses are further limited and regulated by the provisions of the
Condominium Declaration, By-Laws and Rules and Regulations: the development of
attached and detached dwelling units with a density of approximately 12 - 14
units per acre (when constructed), 8 - 12 units per acre (today's code). The Sponsor has obtained the appropriate
variances from the Town of Amherst to permit construction of the Garage Units.
OFFERING PRICES AND
RELATED INFORMATION
Pages 11 through 13
contain Schedule A which sets forth the sales prices and estimated monthly
charges for the Units. Schedule A applies to tenants and non-tenants at all
times.
Tenants have the
exclusive right to purchase the Unit which they occupy during the first ninety
days the Units are offered for sale.
(See page 30 of this Offering Plan.) Closing costs of Unit purchasers
are described in detail on page 47 of this Offering Plan.
The Residential Units,
including the heating, air conditioning, hot water tank, dishwasher, stove and
refrigerator, all are offered in their "as is" condition without
warranty of any kind. The Garage Units
are offered in their "as is" condition without warranty of any kind.
10
SCHEDULE A
Est. Est. Est.
Unit #Bdrm/ Approx. Offering %Common Mthly Mthly Total
Bthrm Area Price Int Common
Taxes Mthly
Chrg. Chrg.
(2) (3) (4) (5) (6) (7) (8) (9)
419-1 2/1 867 ft. $60,900 3.0%
104.64 105.83 210.47
419-2 2/1 867 ft. $58,900 3.0% 104.64 105.83 210.47
419-3 2/1 867 ft. $58,900 3.0% 104.64 105.83 210.47
419-4 2/1 867 ft. $60,900 3.0% 104.64 105.83 210.47
419-5 2/1 867 ft. $60,900 3.0% 104.64 105.83 210.47
419-6 2/1 976 ft. $60,900 3.0% 104.64 105.83 210.47
419-7 2/1 867 ft. $58,900 3.0% 104.64 105.83 210.47
419-8 2/1 867 ft. $60,900 3.0% 104.64 105.83 210.47
439-1 2/1 867 ft. $60,900 3.0% 104.64 105.83 210.47
439-2 2/1 867 ft. $58,900 3.0% 104.64 105.83 210.47
439-3 2/1 867 ft. $58,900 3.0% 104.64 105.83 210.47
439-4 2/1 867 ft. $60,900 3.0% 104.64 105.83 210.47
439-5 2/1 867 ft. $60,900 3.0% 104.64 105.83 210.47
439-6 2/1 976 ft. $60,900 3.0% 104.64 105.83 210.47
439-7 2/1 867 ft. $58,900 3.0% 104.64 105.83 210.47
439-8 2/1 867 ft. $60,900 3.0% 104.64 105.83 210.47
457-1 2/1 867 ft. $60,900 3.0% 104.64 105.83 210.47
457-2 2/1 867 ft. $58,900 3.0% 104.64 105.83 210.47
457-3 2/1 867 ft. $58,900 3.0% 104.64 105.83 210.47
457-4 2/1 867 ft. $60,900 3.0% 104.64 105.83 210.47
457-5 2/1 867 ft. $60,900 3.0% 104.64 105.83 210.47
457-6 2/1 976 ft. $60,900 3.0% 104.64 105.83 210.47
457-7 2/1 867 ft. $58,900 3.0% 104.64 105.83 210.47
457-8 2/1 867 ft. $60,900 3.0% 104.64 105.83 210.47
471-1 2/1 867 ft. $60,900 3.0% 104.64 105.83 210.47
471-2 2/1 867 ft. $58,900 3.0% 104.64 105.83 210.47
471-3 2/1 867 ft. $58,900 3.0% 104.64 105.83 210.47
471-4 2/1 867 ft. $60,900 3.0% 104.64 105.83 210.47
471-5 2/1 867 ft. $60,900 3.0% 104.64 105.83 210.47
471-6 2/1 976 ft. $60,900 3.0% 104.64 105.83 210.47
471-7 2/1 867 ft. $58,900 3.0% 104.64 105.83 210.47
471-8 2/1 867 ft. $60,900 3.0% 104.64 105.83 210.47
Garage
Units
G1-G20 N/A 240
ft. $ 4,250 .20% 6.98 15.25 22.23
TOTALS: $2,009,800 100.0%
11
(1) All projected
figures are for the twelve (12) month period anticipated to commence April 1,
1996 and ending March 31, 1997. None of the Units are subject to rent
regulatory laws. As of February 1,
1995, only Residential Unit 439-6 was vacant.
(2) The prefix of the Residential Unit
designation indicates the building number in which the building is located
(i.e. either Building Number 419, 439, 457 or 471). The suffix indicates the specific unit within the building. Suffix numbers 1 through 4 indicate first
floor units. Suffix numbers 5 through 8
indicate second floor units. The Garage
Units are designated as G1 through G20.
(3) The column
listing indicates only the numbers of bedrooms and bathrooms. In addition, all Residential Units also
include a kitchen, a living room and a dining room area for a total of five
rooms and one bathroom. See also 5.06
of the Declaration for a specific discussion of limited common elements.
(4) The areas given
are approximate for each class of Unit.
The method of calculating the area is as described in Section 4.03 of
the Declaration set forth in Part II of this Offering Plan. It is possible that there may be minor
deviations from the approximate area shown with respect to individual Units. The offering prices shown shall apply to all
purchasers. There are no differences in
prices to classes of purchasers.
Purchasers are referred also to page 24 of the Offering Plan which
explains possible price changes and pages 47-50 of the Offering Plan which
explain closing costs that a purchaser may have to pay.
(6) The basis for
calculating the percentage of common interest applicable to each Unit is the
assignment of equal percentages for each class of Unit, pursuant to the
provisions of Real Property Law Section 339-i-1 (iii). The two classes of Units in the Condominium
are Garage Units and Residential Units.
(7) As of the date
of this Offering Plan, the Sponsor is not offering or procuring mortgage
financing. If a purchaser obtains
financing, the purchaser's debt service will be an additional expense. Purchasers shall also note that these
projected carrying charges do not include certain costs for which the
Unit owner is responsible such as repairs to the interior of the Unit,
separately metered gas and electricity, and, if applicable, cable television
service. A detailed explanation of
what is included in the monthly common charge is set forth in Schedule B and
the footnotes to Schedule B immediately after this Schedule A. Estimated initial annual common
charges for each Residential Unit is $1,255.62.
(8) Pursuant to
Real Property Law Section 339-y, after the Condominium is divided into
individual tax lots, each Unit will be taxed as a separate tax lot for real
estate tax purposes and the Unit owner will not be responsible for the payment
of, nor will the Unit be subject to, any lien arising from the non-payment of
taxes on other Units. Purchasers should
review page 68 of the Offering
12
Plan for a further
discussion on real estate taxes. With
respect to Residential Units, this projection of monthly real estate taxes was
based upon an estimated assessed valuation received from the Town of Amherst
Assessor of $25,000.00 for each of the Residential Units and $3,600.00 for each
of the Garage Units and then applying the current tax rates plus a 5% inflation
factor.
The current tax rates are as
follows:
A. 1995
County Tax - $22.471 per $1,000
of assessed
valuation;
B. 1995-96
School Tax - $25.94 per $1,000 of assessed
valuation;
and
C. Total combined rate = $48.41/$l,000 plus 5_EQ =
$50.83/$l, 000.
Based upon the
current rates plus the five percent (5%) inflation/increase figure, the Sponsor
has estimated that annual taxes will be approximately $1,270.00 for each of the
Residential Units and approximately $183.00 for each of the Garage Units.
Purchasers are
advised that these are estimates only and are subject to the usual political
and economic factors which result in the increase or decrease of real estate
taxes in general.
(9) The total
monthly charge is the sum of the monthly common charge and monthly taxes. The only portion of the total monthly charge
under present tax law deductible for income tax purposes with respect to Units
which are occupied by the owner (not rented to a tenant) will be the monthly
taxes. The monthly common charge will
not be deductible to owner occupied Units.
In addition, because of the complexity and changing nature of the tax
laws, each purchaser should consult separately with his or her tax counsel to
determine what portion of the monthly taxes will be deductible with respect to
that owner's individual tax circumstances.
Purchasers of Units which are occupied must consult directly with their
tax counsel to determine what portion of the total monthly charge will be
deductible on their individual income tax returns. Further, other factors may increase or decrease the amount of the
income tax deduction, such as whether or not the purchaser has obtained
mortgage financing (which factor is not included in this schedule) and in such
case the projected tax deduction may vary due to changes in the interest rate
on the Unit owner's mortgage or from changes in the allocation of constant debt
service payments to interest and principal.
Additionally, there may be changes in real property taxes resulting from
changes in the assessed value, the tax rate or the method of assessing the real
property.
13
SCHEDULE B
Estimated Budget for First Year of
Condominium Operation
April 1, 1996 to March 31, 1997
PROJECTED INCOME
Common Charges (1) $41,854.00
Interest (2) 300.00
Laundry (3) 2,000.00
Total Income $44,154.00
PROJECTED EXPENSES
Heating (4) $
1,270.00
Utilities (Electricity)
(5) 3,500.00
Water (6) 3,000.00
Repairs,
Maintenance and Supplies (7) 14,540.00
Insurance (8) 3,175.00
Management Fees (9) 7,680.00
Legal Fees and
Audit Fees (10) 1,400.00
Franchise Tax (Il) 474.00
Reserves (12) 8,298.00
Operating Contingency
(13) 817.00
Total Expenses $44,154.00
14
FOOTNOTES TO SCHEDULE B
1. Common Charges - Common charges
income is generated from 32 Residential Units each having a 3.0 percent common
interest in the Condominium and 20 Garage Units each having a .20 percent
common interest in the Condominium. The
monthly common charges for the first year of operations is estimated at 104.64
per Residential Unit per month and $6.98 per Garage Unit per month.
2. Interest - The Condominium is expected to have minimal
income
from interest
earned on reserves. Amount is based
upon interest at 3-1/2 per annum.
3. Laundry - Coin laundry income is
based upon a written estimate from Swan-Coin-O-Matic, Inc., 2034 South Park
Avenue, Buffalo, New York 14220, received on March 6, 1991. The term of the proposed contract will be
five (5) years and is based on a sixty percent (60%) projected income to the Condominium
and forty percent (40%) projected income to the contractor. The projected net income to the Condominium
is Two Thousand Dollars ($2,000.00) annually.
(4) Heating
- Based upon billing history received from National Fuel Gas Distribution
Corporation, 10 Lafayette Square, Buffalo, New York 14203. The gas is for hot water for the washing
machines. A five percent (5E.) factor for inflation has been added. Individual
natural gas consumption within each Condominium will be the responsibility of
and will be directly billed to the individual unit owners by National Fuel Gas
Distribution Corporation.
(5) Utilities
(Electric) - Based upon the average annual cost of electricity as supplied
by Niagara Mohawk Power Corporation, 535 Washington Street, Buffalo, New York
14203 for common area lighting (halls, parking lots and laundry
equipment). A five percent (5~) factor
has been added for inflation.
(6) Water -
Based upon the average annual cost of water from the Erie County Water
Authority, 350 Ellicott Square Building, Buffalo, New York 14203, plus an
additional five percent (5E.) for inflation.
(7) Repairs,
Maintenance & Supplies - The estimate for repairs, maintenance and
supplies is composed of the total of separate estimates:
a. Landscaping/Weed
and Feed - Based upon an estimate of $4,321.00 from Maggio Landscaping, 46
Raintree Parkway, Tonawanda, New York 14150.
The fee includes sales tax of eight percent (8%), and includes spring
cleanup, regular lawn cutting, monthly bed maintenance, weeding, shrub
trimming, four applications of lawn fertilization and fall leaf cleanup.
b. General
Common Area Maintenance - Based upon an estimate of $1,600.00 from Advanced
Property Management, Post Office Box 2121, Williamsville, New York 14231-2121,
for the repair of the
15
exteriors of the
buildings (not including roofs - see roof reserve below), cleaning common area
sewer lines, common entry repairs, hall repairs, etc. The work to be completed by independent contractors. The cost is based on $50.00 per unit per annum.
c. Asphalt Roads and Parking -
Based upon proposal from Tom Greenauer Development, Inc., Post Office Box 250,
Springbrook, New York 14140. The
estimate of $600.00 covers asphalt/pot hole repair, sweeping and striping. A five percent (5E.) inflation factor is
included.
d.
Refuse Removal - Based upon estimate of $2,069.00 from Niagara
Sanitation Co., Inc. (BFI), 2321 Kenmore Avenue, Kenmore, New York 14217, for
two, 4 cubic yard dumpsters, pick up weekly.
e.
Snow Removal - Based upon an estimate of $3,500.00 from Restorff
's Landscape Service & Garden Center, Inc., 750 Kenmore Avenue, Buffalo,
New York 14216. Snow removal will
commence at 2 inches. Season extends
from November 1st through March 31st.
The fee includes sales tax and a five percent (5%) extra addition for
miscellaneous work. Snow removal
includes plowing the drives and parking areas and shoveling rear entrances
only.
f.
Common Hall Cleaning - Based upon a written proposal for
$2,450.00 dated November 21, 1994 from VIP Cleaning & Carpet Service, Inc.,
17 Crystal Avenue, Buffalo, New York 14220 for monthly cleaning of hallways and
basement areas in each of the individual Condominium buildings, window cleaning
(above entry) in and out three times a year, carpet cleaning (shampoo and
extraction) once per year.
8. Insurance - Based upon a written estimate of $3,175.00 dated
September 18, 1995,
provided by Warren-Hoffman and Associates, 256 Third Street, Niagara Falls, New
York 14303.
a. Blanket
Building Limit $1,398,000.00
Provides
"All Risk" coverage for the full replacement value of the Units
(including the Garage Units) and other improvements (without deduction for
depreciation) under the "Single Entity Concept", i.e., covering the
units as initially built including the wall-to-wall carpeting, lighting
fixtures, bathroom fixtures, kitchen appliances, wall coverings and all
machinery servicing the units and common facilities, excluding the land,
foundations, personal property of the unit owners and occupants and any
improvements or alterations (including upgrading appliances, kitchen cabinets,
carpeting or lighting fixtures, built-ins and wall coverings) made by present
or prior unit owners or occupants ($500.00 deductible per occurrence).
b. Commercial
General Liability $2,000,000
Provides
payment on behalf of the Board of Managers, Officers of the Condominium,
Managing Agent, if any, and all unit
16
owners, for all
sums for which the insured shall become legally obligated to pay as damages
because of bodily injury or property damage.
c. Non-Owned/Hired
Auto Liability $1,000,000
Provides
protection against the exposure of the association from liability for operation
of autos that it does not own or hire, or that it hires, rents, leases or
borrows.
d. Fidelity
Bond $50,000
Provides
for loss sustained by the insured for any fraudulent or dishonest act of any
director, officer or employee of the insured acting alone or in collusion with
others.
e. Directors
& Officers' Liability $1,000,000
Liability
which provides coverage for sums for which you are legally obligated to pay as
damages because of wrongful acts committed by officers and managers solely in
the conduct of its management responsibilities for the Condominium association.
Includes coverage for the developer and individual members of the developer and
designees of the developer while a member of the Board of Directors.
f. Umbrella $1,000,000
Provides
extra liability for claims that exceed the coverage provided under Commercial
General Liability and Workers' Compensation and Automobile Liability.
g. Workers'
Compensation Statutory
Provides
statutory coverage for employees and noncompensated board members, if injured
while participating in a work activity for the association.
NOTE: Purchasers should obtain additional insurance at their
own cost to cover such risks as: fire and casualty losses to unit contents,
replacements, additions, upgraded fixtures and improvements, and unit owners'
liability coverage for occurrences within the Unit.
Prospective purchasers should also
review page 64 of the Offering Plan as to additional insurance they may obtain
at their own cost to cover such risks as fire and casualty losses to Unit
contents, replacements, additions, fixtures and improvements, and liability
coverage for occurrences within the Unit or, where applicable, on limited
common elements.
9. Management Fees - Management fees
based upon a contract proposal totaling $7,680.00 annually from Advanced
Property Management, Post Office Box 2121, Williamsville, New York 14231-
17
2121, fee is $20.00
per Unit per month for full service property management as outlined in
proposal. Contract allows for sixty
(60) day notice of cancellation of services without cause. The projected cost of the management
contract is substantially the prevailing cost charged for similar services by
management companies in the Western New York area for similar projects.
10. Legal Fees and Audit Fees - a. Cost of services of legal counsel, Richard
M. Holland, Lischer Schop &
Holland, P.C., Brisbane Building, 403 Main Street, Suite 225, Buffalo, New York
14203 is estimated at $500.00 annually.
Services may include interpretation of legal documents, preparation of
audit letters, collection of past due assessments and enforcement of
restrictions and rules.
b. Audit
fees are based upon a written quotation to provide an audit of financial
activity for the first year of operation and file the necessary tax forms for
$900.00. Quote submitted by Anne M.
Rosa, C.P.A., 46 Raintree Parkway, Tonawanda, New York 14150, Telephone (716)
692-6452.
11. Franchise Tax - Payment for New York
State Franchise Tax.
12. Reserves
a. Interior
Painting ($1,048.00 annual reserve) - Based upon written estimate from N.
Choops Painting, Inc., 4804 Transit Road, Depew, New York 14043, received
February 8, 1995 for repainting all ceilings, walls, doors, frames and windows
every five (5) years in the common hallways.
b. Exterior
Painting ($1,604.00 annual reserve) - Based upon written estimate from N.
Choops Painting, Inc., 4804 Transit Road, Depew, New York 14043, to putty,
caulk, spot prime and repaint all exterior doors, frames, railings, shutters,
windows and trim every five (5) years.
c. Hallway
Carpet Replacement ($613.00 annual reserve) -Based upon an estimate from
Carpet Castle, Inc., 3405 Union Road, Cheektowaga, New York 14225 for the cost
to replace carpet in four (4) common halls once every ten (10) years.
d. Roof
Replacement ($1,270.00 annual reserve) - Based upon a written proposal
received from Ken Luksch's State Chimney and Roofing Co., 31 Michele Drive,
Depew, New York 14043 for re-roofing 4 eight (8) unit buildings. The estimated life of the roof of the mansard
sides is 20 (twenty) years. The
estimated life of the mansard sides is 15 (fifteen) years. The estimated life of. the center portions
of the main roof is 15 (fifteen) years.
e. Asphalt/Sealcoat
($633.00 annual reserve) - Sealcoating of asphalt every three (3) years,
based upon a proposal from Tom Greenauer, Post Office Box 250, Springbrook, New
York 14140 dated February 9, 1995.
18
f. Asphalt/Replacement
($1,400.00 annual reserve) - Based upon a proposal from Tom Greenauer, Post
Office Box 250, Springbrook New York 14140 submitted February 9, 1995 to
resurface the asphalt with 1" of topping every ten (10) years.
g.
Reserve Contingency -
The Sponsor estimated $690.00 for
unexpected items
not covered in the budget.
h. Hot
Water Tank Replacement ($260.00 annual reserve) -Based on estimate from
Advanced Property Management for replacement of four (4) 40 gallon hot water
tanks every five (5) years at $325.00 each.
i.
Sump Pump Replacement ($200.00 annual reserve) - Based on
estimate from
Advanced Property Management for replacement of eight (8) sump pumps, every six
(6) years at $150.00 each.
j. Garage
Roof Replacement ($355.00 annual reserve) - Based on an estimate from
Ameri-Tech Associates, 14 Bennington Road, Amherst, New York 14226, for
re-roofing the three (3) garage buildings.
The estimated life span of the garage roofing is twenty (20) years.
k. Garage
Siding Replacement ($225.00 annual reserve) -Based on an estimate from
Ameri-Tech Associates for replacing vinyl siding and trim on the three (3)
garage buildings. The estimated life
span of the siding is forty (40) years.
13. Operating Contingency - Estimate of
$817.00 supplied by Advanced Property Management for unexpected items not
provided for in the operating expenses portion of the budget.
19
SCHEDULE 0-1
SMALLWOOD SQUARE CONDOMINIUM
PROJECTED BUDGET FOR INDIVIDUAL
RESIDENTIAL UNIT ENERGY COSTS (1)
The Sponsor has obtained actual
monthly figures from National Fuel Gas Distribution Corp. for natural gas usage
in typical units.
The estimates of monthly natural gas
costs are based upon the consumption figures supplied by National Fuel Gas
multiplied by the current rate, plus an inflation factor of 5% as set forth
below:
Estimated Space Heating Costs
Cu. Ft.
Unit (2) Natural Gas/Year Cost/Year
1, 2, 3 58,700 $300.00
5, 7, 8 61,750 315.00
6 66,900 340.00
(1) These
estimates of energy consumption may vary greatly, depending on the needs and
standards of comfort of the apartment's occupants, the number of occupants, the
time of day the unit is occupied and weather conditions.
(2) Usage
for heating all Residential Units with gas forced air furnace.
Estimated Electric Usage
Unit (3) Cost/Year
1 $434.00
2 563.00
3 510.00
4 458.00
5 492.00
6 651.00
7 610.00
8 550.00
(3) These
estimates can vary greatly because they are based upon total electric
consumption, including air conditioning cost. All of the variables for cost set
forth in footnote (2) above as to heating cost apply equally as to cooling
cost. Additional substantial variables are possible as to electric usage
because there is no way to predict how many and what types of electric
appliances (computers, stereos, etc.) an individual may use.
20
Estimated
Domestic Hot Water
To estimate the cost to heat
domestic hot water, we assumed an average occupancy of three (3) persons per
unit with a daily hot water usage of fifty-five (55) gallons. The estimated fuel consumption for heating domestic
hot water, for a family of three (3) is 26,500 cubic feet of natural gas. This represents an annual cost of $145.00
(based on the current cost of natural gas).
NOTE: In accordance with the trend of recent years,
it
should be expected that utility costs will
increase in the future. In addition,
the effect of inflation, severe weather, fuel shortages and other factors may
raise the cost of fuel substantially higher than the current rate. The Sponsor
advises that these and other factors beyond the Sponsor's control could
substantially affect the utility costs in subsequent years.
21
Advanced Property Management
P.O. Box 2121 Williamsville, New York
14231-2121
Phone or Fax: (716)626-9465
October 24, 1995
OPINION BY LICENSED REAL ESTATE
BROKER
ON COMPLIANCE WITH NEW YORK REAL PROPERTY
LAW
SECTION 339-I
SMALLWOOD
SQUARE CONDOMINIUM
Advanced Property
Management has been retained by Burroughs Drive Apartments, Inc., the Sponsor,
in connection with the Condominium Offering Plan for the conversion of thirty
two (32) apartments located at 419 Burroughs Drive, 439 Burroughs Drive, 457
Burroughs Drive and 471 Burroughs Drive, Snyder, New York, to confirm
compliance by the Sponsor with New York Real Property Law section 339-i in
connection with the method selected for calculating the percentage of common
interest allocated to each unit at Smallwood Square Condominium (the
"Condominium").
My experience with
offering plans and with the management and selling of condominiums and other
relevant expertise includes:
Bill I. Basil, C.A.M., A.M.S.,
Licensed Real Estate Broker.
Property
Manager, Hall Financial Group, Inc., Management Division, 4 years. Hall
Financial is the second largest apartment and office property owner/management
firm in the nation. Responsibilities included management of approximately 740
residential units and office space in Phoenix, AZ; including preparation of
annual operating budgets including maintenance, construction/capital
improvement cost estimates, seasonal contracts, utilities, insurance,
administrative costs, security, staffing, and promotion.
Property
Manager, Sibley Real Estate Services, Inc., Community Association Management
Division, 2 years. Responsibilities
included management of all aspects of the operations of a portfolio of 14
community associations including cooperatives, condominiums and homeowners
associations in Western New York; including preparation of annual operating
budgets including maintenance, replacement cost analysis and replacement fund
account analysis, seasonal contracts, utilities, insurance, administrative
costs, security, and staffing.
Currently
President, owner/partner, and one of the founders of Advanced Property
Management, a company which specializes in management of residential and
community association properties.
Designated
by the Community Association Institute, as an Association Management Specialist
(AMS).
Designated by the National Apartment
Association, as a Certified Apartment Manager (CAM). Licensed Real Estate
Broker in the State of New York.
22
Smallwood Square
Condominium October 24, 1995
Page 2
Advanced Property
Management - It is intended that Advanced Property Management will be the
Managing Agent for the Condominium.
Advanced
Property Management currently manages the following Community Associations: 140
units in the Lamplighter Condominium; 48 units in the Pomeroy Lane Condominium,
all located in Amherst, New York;
I am not the
selling agent for the Smallwood Square Condominium property.
'The method
selected pursuant to Real Property Law Section 339(i) for calculating the
percentage of common interest appurtenant to each unit is that set forth in
339-i (1) (iii), being based upon equal percentages to each class of Unit as of
the projected date of filing the declaration. There will be two classes of
Units: Residential Units and Garage Units. All Residential units are two
bedroom units with kitchen, living room, dining room and bathroom. All
Residential Units are approximately the same size except that Unit 6 in each
building is somewhat larger than the other units. The additional size does not
materially impact maintenance costs to the Condominium and therefore no greater
percentage has been assigned to these Units. All Garage Units are approximately
the same size and accordingly are assigned the same percentage of common
interest within their class.
ADVANCED PROPERTY
MANAGEMENT
Basil (Bill) J.
Basil, II, President
23
CHANGES IN PRICES AND UNITS
The offering price to be
paid by tenants will not be increased during the initial ninety-day period
during which tenants have the exclusive right to purchase.
The offering price as
set forth in Schedule A must be changed by a duly filed amendment to the
Offering Plan when the change in price is an across-the-board increase or
decrease affecting one or more lines of Units or Unit models, or is to be
advertised, or is a price increase for an individual purchaser. The Sponsor has
reserved the right to enter into an agreement with an individual purchaser to
sell one or more Units at prices lower than those set forth in Schedule A
without filing an amendment to the Offering Plan. The Sponsor cannot negotiate Unit prices in any fashion that
would constitute a prohibited discriminatory inducement to a purchaser or
tenant.
No change will be made
in the size or number of Units and/or their respective percentages of common
interests, and no material change will be made in the size or quality of common
elements, except by amendment to the Offering Plan and, when applicable, to the
Declaration.
Unless an affected
purchaser consents, no material change will be made in Unit size, layout or
percentage of common interest if a Purchase Agreement has been executed and
delivered to the Sponsor for that Unit and the purchaser is not in default.
No material change will
be made in the size and no material adverse change will be made in the quality
of common elements unless purchasers not in default receive a right to rescind
and a reasonable period of time that is not less than fifteen (15) days after
the date of presentation to exercise the right. Sponsor must return any deposit or down payment promptly to
purchasers who rescind.
24
46 RAINTREE
PARKWAY TONAWANDA, NEW YORK 14150-2601 (716)692.6452
To the Shareholders
Burroughs Drive
Apartments, Inc.
I have examined the accompanying
Schedule of Gross Income and Direct Operating Expenses of Burroughs Drive Apartments,
Inc. located at 415 - 471 Burroughs Drive, Town of Amherst, New York for the
years ended December 31, 1994 and 1993.
My examinations were made in accordance with generally accepted auditing
standards, and accordingly, included such tests of the accounting records and
such other auditing procedures as I considered necessary in the circumstances.
The accompanying Schedule, prepared on
the accrual basis of accounting, was developed for the purpose of complying
with a request of the State of New York Attorney General Office and excludes
certain material expenses described in Note 1, that would not be comparable to
those resulting from the proposed future operational activity of the property.
In my opinion, the Schedule referred
to above presents fairly the gross income and direct operating expenses of
Burroughs Drive Apartments, Inc. for the years ended December 31, 1994 and
1993, in conformity with generally accepted accounting principles applied on
the basis described in the preceding paragraph.
September 15, 1995
25
BURROUGHS DRIVE APARTMENTS, INC.
SCHEDULE OF GROSS INCOME AND DIRECT OPERATING
EXPENSES
FOR THE
YEARS ENDED DECEMBER 31, 1994 AND 1993
1994 1993
-GROSS INCOME - apartment rentals $ 206,817 $ 154,692
laundry income 1,191 0
208, 008 154,692
DIRECT OPERATING
EXPENSES:
Real property taxes 37,793 37,015
Repairs and maintenance - interiors 35,513 14,874
Repairs and maintenance - common area 26,155 2,429
Utilities 5,499 4,274
Insurance 3,463 3,709
Water and sewer 3,084 2,341
Lawn service 2,243 7,422
Trash removal 2,115 2,676
Snow removal 2,001 1,173
Cleaning service - common area 1,974 1,588
119,840 77,501
EXCESS OF GROSS
INCOME OVER
DIRECT OPERATING EXPENSES $
88,168 $ 77,191
See accompanying notes to Schedule.
26
BURROUGHS DRIVE APARTMENTS, INC.
Notes to Schedule of Gross Income and Direct
Operating Expenses
December 31, 1994
Note
1 - Summary of Significant
Accounting Policies
Accounting Method - The Schedule of Gross Income and Direct
Operating Expenses was prepared using the accrual basis of accounting. Certain material expenses such as
depreciation, management fees and interest expense are not included.
Description of Operations - The apartment project consists
of four 8-unit apartment buildings located in Town of Amherst, New York. The units were owned and managed until May
4, 1994 by Leona and Eugene Tenney at which time the property was purchased by
Burroughs Drive Apartments, Inc. Management fees and certain allocated expenses
were paid during 1994 totaling $ 8,574 ($ 20,875 - 1993) and were excluded from
this Schedule of Gross Income and Direct Operating Expenses.
General Plan of Improvement - Burroughs Drive Apartments,
Inc. has incurred certain costs to renovate the property that have been
capitalized as part of the overall plan to improve the property for the
condominium conversion. Capitalized costs during 1994 include $ 17,013 for
landscaping the yard areas and $ 7,203 for new carpeting in the common area
hallways.
Note 2 - Utilities
Each apartment unit is separately metered for electric and
gas. The utility expenses included in
this Schedule are for common area gas and lighting. The total of such expenses amounted to $ 5,499 ($ 4,274 - 1993) -
Note 3 - Repairs and maintenance
In anticipation of the proposed sale of the individual apartments
as condominium units, the owners have incurred significant costs, over and
above normal yearly maintenance costs, to renovate the property. Interior unit repairs and maintenance
included painting of apartment units, replacement of carpeting and floorings,
repairs or replacements of appliances, and other electrical or plumbing repairs
and totaled $ 35,513 ($14,874 - 1993).
27
BURROUGHS
DRIVE APARTMENTS, INC -
Notes
to Schedule of Gross Income and Direct Operating Expenses
December 31, 1994
Note
3 - Repairs and maintenance
(continued)
Exterior unit repairs and maintenance included repair of common
areas and repairs and maintenance of electrical, plumbing and general building
maintenance. These expenses totaled $
26,155 ($2,429 - 1993)
Note 4 - Lawn service
Included in lawn expense in 1993 is a charge of $ 4,123 for
landscape improvements incurred over and above the normal yearly lawn
maintenance costs.
27A
This page is intentionally left blank.
27B
THE
RIGHTS OF ELIGIBLE SENIOR CITIZENS 'AND
ELIGIBLE
DISABLED PERSONS
Because the Town of
Amherst has previously elected the applicability of General Business Law
Section 352(e) (2-a), Senior Citizens and Disabled Persons who meet the
eligibility requirements set forth in this Offering Plan per the Attorney
General's regulations, may not be evicted by Unit owners or any subsequent
purchaser at any time due solely to the conversion of the building to
condominium ownership, but may be evicted for other cause as set forth below.
Eligible Senior
Citizen
An Eligible Senior
Citizen is a non-purchasing tenant and the spouse of a non-purchasing tenant
who: (1) is sixty-two (62) years of age or older on the date that the Plan is
filed with the Department of Law ("filing date"); and (2) has elected
not to purchase his or her apartment within sixty (60) days from the date the
final filed Offering Plan is served upon the tenant (the "presentation
date") by completing the Senior Citizen Election Form in the Plan, signing
the Form and having the signature notarized, and personally delivering it to
Burroughs Drive Apartments, Inc. at 12870 Williston Road, East Aurora, New York
14052 or by mailing it by certified or registered mail, return receipt
requested, to Burroughs Drive Apartments, Inc. at 12870 Williston Road, East
Aurora, New York 14052.
Eligible Disabled
Person
An Eligible Disabled
Person is a non-purchasing tenant and spouse of a non-purchasing tenant who:
(1) has an impairment which results from anatomical, physiological or
psychological conditions, other than addiction to alcohol, gambling, or any
controlled substance, which is demonstrable by medically acceptable clinical
and laboratory diagnostic techniques, and which is expected to be permanent,
and which prevents the Disabled Person from engaging in any substantial gainful
employment on the date the Department of Law accepted the Plan for filing; and
(2) has elected not to purchase his or her apartment within sixty (60) days
from the presentation date by completing the Disabled Person Election Form in
the Plan, signing the Form and having the signature notarized, and personally
delivering it to Burroughs Drive Apartments, Inc. at 12870 Williston Road, East
Aurora, New York 14052 or by mailing it by certified or registered mail, return
receipt requested, to Burroughs Drive Apartments, Inc. at 12870 Williston Road,
East Aurora, New York 14052.
If the disability first
occurs after acceptance of the Plan for filing, then such election may
be made within sixty (60) days following the onset of such disability unless
during the period subsequent to sixty (60) days following the presentation of
the Plan for filing but prior to such election, the Sponsor accepts a written
agreement to purchase the apartment from a bona fide
28
purchaser.
Description of
Protections Given to Eligible Senior Citizens and Eligible Disabled Persons
Under General Business Law Section 352-e
A. No eviction proceedings will be commenced at
any time against either Eligible Senior Citizens or Eligible Disabled Persons, except
for non-payment of rent, illegal use or occupancy of the apartment, refusal of
reasonable access to the owner or a similar breach of obligations to the
landlord.
B. Eligible Senior Citizens and Eligible Disabled
Persons who reside in apartments subject to government regulation as to rentals
and continued occupancy shall continue to be subject to such regulations. There are no such governmental rental
regulations affecting any of the apartments in the Smallwood Square Condominium
project.
C. The rentals of Eligible Senior Citizens and
Eligible Disabled Persons who reside in dwelling units not subject to
governmental regulation as to rentals and continued occupancy (i.e. all of the Units in Smallwood Square
Condominium are not subject to such regulation) and Eligible Senior Citizens
and Eligible Disabled Persons who reside in dwelling units with respect to
which governmental regulation as to rentals and continued occupancy is eliminated
or becomes inapplicable after the Offering Plan has been accepted for filing by
the Department of Law shall not be subject to unconscionable increases beyond
ordinary rentals for comparable apartments during the period of their
occupancy. Eligible Senior Citizens and
Eligible Disabled Persons should take note that rental increases are allowed so
long as they do not fall into the category of "unconscionable increases
beyond ordinary rentals for comparable apartments during the period of their
occupancy". Complaints concerning
such increases may be referred to the New York State Department of Law, Bureau
of Real Estate Financing, 120 Broadway, New York, New York 10271.
D. The rights granted under this Offering Plan and
applicable rent regulatory laws (there are no such laws applicable to this
Offering) to Eligible Senior Citizens and Eligible Disabled Persons may not be
abrogated or reduced, regardless of any expiration of or amendment to General
Business Law Section 352-e (2-a)
E. Each owner of a Unit occupied by an Eligible
Senior
29
Citizen or Eligible Disabled Person shall be
bound by the provisions of the General Business Law and the terms of this
Offering Plan. The Condominium By-Laws
must require that such purchase is subject to all the rights of the Eligible
Senior Citizen or Eligible Disabled Person occupying the apartment and that the
purchaser, his successors and assigns shall continue to be bound as long as
such occupancy continues (see By-Laws Section 9.6 in Part II of this Offering
Plan.
Sponsor Dispute of
Election
The Sponsor may dispute
the election by a tenant to be an Eligible Senior Citizen or an Eligible
Disabled Person by applying to the Department of Law for determination of the
tenant's eligibility within thirty (30) days of the receipt of the Election
Form pursuant to Section 23.8 of the Regulations of the New York Attorney
General. (A copy of Section 23.8 of the
Regulations is included in Part II of this Offering Plan on Page 216.) The
Department of Law shall issue a determination of eligibility within thirty (30)
days thereafter.
Effect of Election
not to Purchase
An election not to
purchase (see above) shall not preclude an electing Eligible Senior Citizen or
Eligible Disabled Person from subsequently purchasing his or her apartment on
the terms and conditions set forth in Section 23.8 of the Regulations, which
state that the Unit may be purchased on the term then offered to other tenants
in occupancy.
RIGHTS OF
EXISTING TENANTS
Applicable Law
The New York City Rent
Stabilization Law, New York City and State Rent Control Laws, the Emergency
Tenant Protection Act and Article 7c of the Multiple Dwelling Law do not apply
to the Smallwood Square Condominium Property or to the tenants of the
Property. The rights of tenants as
established by the General Business Law are described in this section as
follows. (The rights of Eligible Senior
Citizens and Eligible Disabled Persons under General Business Law Section 352-e
(2-a) are described in detail in the preceding section of this Offering Plan.)
The Exclusive
Period
All bona fide tenants in
occupancy on the date the Offering Plan is accepted for filing with the
Department of Law will have the exclusive right to purchase their dwelling
Units for
30
ninety (90) days
after the Plan is presented. Any bona
fide tenant with the right to renew a lease on the date the Plan is accepted
for filing by the Department of Law has the right to purchase as a tenant
during the exclusive period. Any bona
fide tenant who has the right to continued occupancy on the date the Plan is
accepted for filing has the right to purchase as a tenant during the exclusive
period. For the purpose of determining
who has the right to purchase during the exclusive period, a bona fide tenant
of record with an unexpired lease on the date the Plan is accepted for filing
shall presumed to be a "tenant in occupancy" even if the tenant has
sublet his or her dwelling unit or the dwelling Unit is not the tenant's
primary residence. A bona fide
sublessee in occupancy on the date the Plan is accepted for filing has the
right to purchase during the exclusive period if he or she: (I) sublets from a
non-bona fide tenant; or (2) has obtained written permission to purchase his or
her dwelling Unit from the bona fide tenant of record. Nothing herein shall be construed to deprive
an owner of any legal remedy for illegal occupancy.
The Sponsor may accept
Purchase Agreements from non-tenants for occupied Units during the exclusive
period so long as the Purchase Agreement executed provides that a Purchase
Agreement from a tenant in occupancy for his or her own Unit executed during
the exclusive period shall nevertheless have priority over and preempt the
Purchase Agreement from a non-tenant.
Paragraph 14 of the form Purchase Agreement set forth in Part II of this
Offering Plan contains this statement.
In the case of a Unit occupied by an Eligible Senior Citizen or Eligible
Disabled Person, such Unit may not be offered to a third party during any
exclusive purchase period granted to bona fide tenants in occupancy unless the
Sponsor, in writing, waives any right to challenge the eligibility of the said
Eligible Senior Citizen or Eligible Disabled Person occupying the Unit.
Protected Period of
Occupancy
No tenant may be evicted
during the exclusive period (see discussion above). The right of the Sponsor or a purchaser of a Unit to evict a
tenant is subject to the terms of the tenant's lease and applicable statutory
law governing the eviction process. Purchasers of Units occupied by tenants are
advised to consult with their attorneys regarding legal requirements for
eviction and to review any existing Unit leases.
No Posting of
Notice
Because this Offering is
made under Section 352-e of the General Business Law and is not affected by GBL
Sections 352-eee or 352-eeee, there is no requirement of provision of notice to
tenants or posting of the percentage of tenants who have purchased Units, or
percentage of Units for which the Sponsor has accepted purchase agreements.
31
Rent Increase
Protection
The Condominium Units
are not subject to any rent control laws or similar regulations.
provision of
Services
Non-purchasing tenants
will continue to be provided all services and facilities required by law on a
non-discriminatory basis.
Non-purchasing tenants should refer to the services described in the
"Obligations of Owners of Dwelling Units Occupied by Non-purchasing
Tenants" beginning on page 34 of this Offering Plan.
General Discussion
of Additional Tenant Rights
There is no existing
requirement that tenants or their representatives be allowed to inspect the
building or buildings. Tenants are generally protected against interruption or
discontinuance of services under the warranty of habitability provisions of the
Real Property Law and applicable provisions of the Multiple Residence Law. The regulations of the Attorney General
generally protect tenants against harassment by the Sponsor. Applicable statutory and New York case law
may protect harassment of tenants by non-purchasing owners depending upon the
specific circumstances surrounding alleged instances of harassment.
Eligible Senior Citizens
and Eligible Disabled Persons have extensive additional rights as described in
detail on Pages 28 through 30 above.
Rent Increases Due
to Capital Improvements
The Sponsor has reserved
the right to make various capital improvements to the Property, but has not as
of the date of this offering Plan committed to make any capital improvements.
Notice of Changes
in Ownership
Section 9.01 of the
Condominium By-Laws provide that nonpurchasing tenants will be promptly
notified of changes in ownership by any purchasers of their Units and that the
Sponsor or the Board of Managers will retain and make available such
information.
No Assignment of
Purchase Agreements
The Sponsor will not
permit the assignment or transfer of purchase agreements by tenants in
occupancy prior to declaring the Plan effective or after declaring the Plan
effective without Sponsor's express written consent. See also "Assignment of Purchase Agreements" on page 43
of this Offering Plan.
32
Effect of Amendment
of Terms and Conditions to Bona Fide Tenants
If the Sponsor amends
the terms and conditions of the Offering Plan prior to the closing of the first
Unit to be more favorable to non-purchasing tenants, a person entitled to
purchase pursuant to SectiOn 23.3(n) (1) (i) of the regulations of the
Department of Law and who executed and submitted a purchase agreement for the
Unit the tenant occupied on the date that the Plan was accepted for filing
shall benefit from the more favorable terms and conditions, even though such
purchase agreement was entered into before the Sponsor amended the terms. This provision will not apply to tenants who
purchased Units other than their own. This provision will also not apply to
assignees of tenant's purchase agreements if the Sponsor permits such
assignments.
purchase of Other
Units by Tenant in OccupancY
A tenant in occupancy
may purchase a vacant Unit or any other Unit not occupied by tenant during the
exclusive period or at any other time.
If such tenant does elect to purchase a vacant apartment (or other Unit)
during the exclusive period, the price will be that listed in Schedule A to
this Offering Plan for the exclusive period.
If the apartment is occupied by another tenant, the Purchase Agreement
from the non-occupying tenant shall be preempted by and second in priority to
any Purchase Agreement from the occupying tenant during the exclusive period as
outlined below ("Priority of Purchase Agreement"). After the expiration of the exclusive
period, if more than one tenant seeks the same apartment, the Sponsor reserves
the right to choose which Purchase Agreement to accept.
No Tenants in
Occupancy Have Special Access
There are no tenants in
occupancy who have access to or an exclusive right to use any portion of the
common elements, except that they will have the right to use those limited
common elements appurtenant to the Unit they occupy.
PrioritY of
Purchase Agreement
A Purchase Agreement
from a tenant in occupancy for his or her own Unit executed during any
exclusive purchase period shall have priority over and preempt any purchase
agreement from non tenants. This
statement is included in paragraph 14 of the form Purchase Agreement set forth
in Part II of this Offering Plan. The
Sponsor may accept purchase agreements from non-tenants for occupied Units
during the exclusive period so long as this statement is set forth in the
Purchase Agreement and the Sponsor acts in compliance.
In the case of a Unit
occupied by an Eligible Senior Citizen or Eligible Disabled Person, such Unit
may not be offered to a third party during any exclusive purchase period
granted to bona fide tenants in occupancy unless the Sponsor, in writing,
33
waives any right to
challenge the eligibility of the said Eligible Senior Citizen or Eligible
Disabled Person occupying the Unit.
Property Is Not
Subject to Rent Regulation
As discussed above, the
Smallwood Square Condominium is not subject to rent regulation.
Because this Offering
Plan is subject to General Business Law Section 352-e (2-a), there are
protections against rent increases for Eligible Senior Citizens and Eligible
Disabled Persons. See discussion under
"Description of Protections Given to Eligible Senior Citizens and Eligible
Disabled Persons under General Business Law 352-e(2a)" on Page 28 above.
OBLIGATIONS OF OWNERS OF
DWELLING UNITS
OCCUPIED BY
NON-PURCHASING TENANTS
A. For those purchasers who intend to occupy
the Residential Unit after closing (as indicated on their Purchase Agreement) -
The Sponsor will provide that the Unit will be vacant at closing.
B. The following applies to
Purchasers who do not intend to occupy the Residential Unit after closing:
The purchaser of any
Residential Unit occupied by a nonpurchasing tenant is purchasing subject to
the terms of that tenant's lease. Any
purchasers of occupied Units should carefully examine the terms of the lease
applicable to the Unit they are purchasing, specifically including but not
limited to the expiration date of that lease.
Copies of all leases in effect at the date of presentation of the
Offering Plan are available for examination by prospective purchasers.
Purchasers of
Residential Units who have agreed under the terms of the Purchase Agreement to
close the purchase of the Residential Unit prior to the expiration date of an
occupying tenant's lease are again warned that the purchase is subject to all
of the terms of the lease. The tenant
will have the continuing right to occupy the Unit after the date of closing of
such sale until the date of expiration of the lease. If the tenant does not vacate the Unit after the lease expiration
date, the purchaser may then bring an eviction proceeding under applicable New
York State law. The Sponsor makes no
representation as to the length of time it may take or the costs that may be
incurred by a purchaser in the effort to evict a tenant after the expiration of
the lease term and gain possession of the Unit.
None of the Units are
subject to any rent control or rent stabilization laws. The property is subject to the provisions of
the New York Multiple Residence Law.
34
The Unit owner will be
obligated to pay monthly common charges, special assessments and real estate
taxes for the Unit even if these amounts are more than whatever rent may be
received from the non-purchasing tenant.
The Unit owner must also provide to the non-purchasing tenant all
services required by law, including the obligation to make repairs to the Unit
whiCh are not the responsibility of the Board of Managers of the condominium.
All owners of Residential Units occupied by tenants must comply with Section
235-b of the New York Real Property Law (Warranty of Habitability) and with
applicable building codes, which are typical of the obligations imposed upon
any landlord of residential Units. Purchasers of occupied Units are strongly
advised to consult their legal counsel as to the scope of obligations typically
undertaken by landlords under applicable New York law.
As stated above, all
litigation costs and fees related to the tenancy will be the sole
responsibility of the purchaser. The
purchaser has no obligation to give renewal leases and riders under any law
applicable to the condominium. As
stated above, the purchaser takes subject to the terms of the tenancy and
tenants may be evicted only on grounds permitted by law.