Another one bites the dust. Another land lease in northeast Queens, that is, where the 125-unit Bay Terrace Co-op Section IV has become the latest in a string of neighboring co-ops to buy out its dreaded land lease. The lease was set to expire in 40 years and lacked a renewal provision, which hampered shareholders’ ability to sell their apartments and the co-op board’s ability to refinance the corporation’s underlying mortgage. Without ownership of the land it sits on, the co-op faced an uncertain future – possibly even dissolution if the landowner did not agree to renew the lease or sell the land.
“We are thrilled that we were able to preserve and perhaps increase the value of the co- op apartments as a result of this purchase,” says board president Judy Valente, adding that the unusual land-lease arrangement was a “dark cloud” hanging over the co-op.
Section IV is one of nine Bay Terrace co-ops in Bayside, Queens, that were built in the 1950s on land owned by Cord Meyer Development. Eight of the nine sections, which total 1,800 garden apartments, are buying out their 99-year land leases, while the ninth is acquiring ownership through a land swap. The Section IV co-op paid $5.1 million for its land; the eight co-ops are expected to pay a total of about $30 million.
The negotiations have been ongoing for more than a decade. One of the lead negotiators for the co-ops has been attorney Geoffrey Mazel, a partner at Hankin & Mazel, who represents Section IV and four other Bay Terrace co-ops. “In my 30-year career,” Mazel told Habitat last year, “this is one of the greatest things I’ve been part of.”
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