Gary, Other/Just Looking in 10025

Are condos in Battery Park City fee simple ownership?

Asked by Gary, 10025 Sat Aug 18, 2007

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Battery Park City condos are not fee simple ownership.

Condos located in Battery Park City are located on leased land. The Battery Park City Authority is the holder of the tenant's interest in such leasehold interest. "Qualified leasehold condominium" is the form of condominium ownership in Battery Park City.

While the units themselves, together with their common interest, are deemed real property the land on which they stand is owned by the Battery Park City Authority.

More about Battery Park City below:
4 votes Thank Flag Link Sat Aug 18, 2007
Mitchell Hall, Real Estate Pro in New York, NY
MVP'08
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Manhattan has a very open and efficient marketplace. High PILOT/Taxes in Battery Park due to ground rents keep prices down. When comparing a condo purchase in Battery Park vs. some other part of the city here's a quick way to calculate what we consider to be real costs.

If a $1 million condo in Battery Park has $20,000 in annual monthlies and a $1M condo in the Financial District has $10,000 in annual monthlies. You can capitalize the difference (let's say at a 5% cap rate). You would take the difference of $10,000 and divide it by 5%, giving you a real $200,000 price difference in today's dollars. So the $1M condo in Battery Park would "really" cost $1.2M when comparing apples with apples.

Derek Lee
Managing Partner
L.G. Fairmont Group
1 vote Thank Flag Link Wed Mar 23, 2011
PILOT = Payment in lieu of taxes.
1 vote Thank Flag Link Tue Aug 21, 2007
Mitchell Hall has the best answer. If you have any other questions, I would contact him directly.
0 votes Thank Flag Link Yesterday at 7:14am
There are some really good answers here and very knowledgeable brokers!
0 votes Thank Flag Link Mon Jun 4, 2012
There is no fee simple ownership. The condos in Battery Park City don't own the land underneath the buildings. In this case, the buildings lease the land from the Battery Park City Authority, a public agency that was formed in the 1960s to develop the then-nascent neighborhood. The land-rent fees get rolled into the monthly condo fees that owners pay. In Battery Park City, the current amount paid toward ground rents range from about $30 dollars a month to several hundred dollars per condo unit, depending on the building.
0 votes Thank Flag Link Thu May 31, 2012
I am an expert in the Battery Park City area.

No there is no fee simple ownership my friend.

Like many other properties in Battery Park City, the condos in Battery Park City don't own the land underneath the buildings. In this case, the buildings lease the land from the Battery Park City Authority, a public agency that was formed in the 1960s to develop the then-nascent neighborhood.

The land-rent fees get rolled into the monthly condo fees that owners pay. In Battery Park City, the current amount paid toward ground rents range from about $30 dollars a month to several hundred dollars per condo unit, depending on the building.

What sets the Battery Park City condos apart from other properties is how the ground rents were scheduled to rise over time. Most buildings with ground leases have long-term agreements spanning around 100 years with predicable price rises.


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DOM PASCUAL, J.D., ESQ.
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0 votes Thank Flag Link Tue May 29, 2012
No they are not fee simple ownership. Mitchell Hall nailed it.
But that fact alone does not make them bad investments.
0 votes Thank Flag Link Sat Dec 1, 2007
I am just looking into some units in the BPC area. This PILOT thing scares me. Is it true they are 100% tax deductible? When, and how much can they go up every year?
0 votes Thank Flag Link Wed Nov 21, 2007
Thanks for the information. What does PILOT mean?
0 votes Thank Flag Link Tue Aug 21, 2007
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