Philip Benyola
wrote
"http://www.citylimits.org/content/articles/viewarticle.cfm?article_id=3585&content_type=1&media_type=3 ------------------------------------------------------------------------------------------- And a conversion could mean windfall profits for those who sell their apartments. The average amount of equity, which is the purchase price under Mitchell-Lama, is about $18,000 and the average market value, or potential selling price out of Mitchell-Lama, is about 36 times that, or $650,000. That sounds sweet, but a number of factors complicate the selling process, as well as the privatization plan. For one, co-operators actually don?t own their apartments; as in a private co-op, residents own shares in the co-op. Also, privatization will cost East Midtown tens of millions of dollars in forfeited tax shelters and at least $53 million in new mortgages, moving the complex from the low-risk environment of city-financed loans and government regulation, to the high-risk environment of private financing and the real estate market. Just like any other apartment residence, East Midtown must raise enough money to meet its mortgage payments and to pay operating costs. Anti-privatization residents worry that a privatized co-op might not earn enough money from fees collected on apartment sales and fees for maintenance to meet its financial responsibilities."
7/9/08 1:06 PM
