Austin , TX Office Condo Conversions
Converting to an Office Condo
An office building owner may find it a good idea to convert their investment into a office condo for sale or an office condo for lease . Just like apartment conversions, the tenants can be given the right to purchase their offices prior to the office condo being offered to the general public for sale. This would be a strategic advantage for current tenants leasing the property.
Process of Austin Office Condo Conversions
The office building owner can convert their suites to a condominium after renovations and filing of condominium papers , arranges financing , promoting the new office condo property and having subsequent closings. The office property can be subdivided into individual private office condo ownerships that include an interest in the common areas of the office property.
Common Area Maintenance with an Austin, TX Office Condo Conversion
Common areas are typically roof, elevators, hallways, restrooms, entry areas as well as utility and storage areas. The new owners formally tenants would form a condo owners association (COA) and assess dues which will cover the maintenance of the common areas as well as taxes. The COA is responsible for principal, interest, property taxes and insurance and common area maintenance plus a proportionate share of the common area.
One problem that could arise is if an office condo owner lost their property or properties through a bankruptcy. This would mean the other office condo owners would have to meet the property’s taxes, maintenance and insurance liabilities. This issue could put a COA in jeopardy, so careful attention must be paid to all contingencies and provisions for this type of commercial real estate scenario.