Should an UWS Co-op Sell to a Buyer Via an LLC?

A shareholder in a co-op on the Upper West Side wants to know, however, whether such an owner can simply sell the LLC later, to avoid a normal share transfer and a review and approval by the board.

In this week's "Ask Real Estate" column in The New York Times, Ronda Kaysen explains that LLCs are common in many transactions in the luxury market, especially among foreign and investment buyers. Many co-ops still ban the practice and it's much more common in condominiums. But assuming this UWS co-op is open to letting a buyer purchase through an LLC, Kaysen urges the board to "pay close attention to the approval documents. They should be crafted to protect the co-op. The co-op’s lawyer should include safeguards preventing the sale of the L.L.C. or a controlling interest in an L.L.C. without proper notice and approval from the co-op board. Any sale of the L.L.C. would be considered a sale of the apartment."

For a deeper dive into LLC waters, be sure to check out our in-depth piece on whether co-op boards should let LLCs buy.