New York City Council Considers Legislation Impacting Nonprofit Homeownership

The New York City Council is currently evaluating the **Community Opportunity to Purchase Act (COPA)**, legislation aimed at increasing nonprofit access to residential and commercial real estate. If approved, the bill could significantly impact property sales by introducing additional requirements that may delay transactions.

Under the proposed legislation, owners of buildings with three or more residential units would need to inform the **Department of Housing Preservation and Development** (HPD) and a list of designated “qualified entities” when they intend to sell. Nonprofits would then gain the first right of refusal, allowing them to submit an initial offer and match competing bids. While proponents argue this would enhance affordable housing options, critics warn it could extend the closing process by as much as **180 days**, complicating sales and financing.

Sandy Nurse, the lead sponsor of the bill and a council member representing parts of Brooklyn, claimed COPA would “level the playing field” for nonprofits, enabling them to help preserve at-risk affordable housing. Advocates for affordable housing, including groups like the **New York Community Land Initiative**, support the bill, citing successful implementations in cities such as Washington, D.C., and San Francisco.

Despite these intentions, many within the real estate sector express significant concerns. Ann Korchak, board president of **Small Property Owners of NY (SPONY)**, warned that the bill could lead to prolonged selling processes, increased uncertainty, and financial burdens for small property owners. Korchak stated, “This effort poses a deeply unfair burden on small property owners that risks putting us in even greater financial risk.”

The HPD has indicated that approximately **90,000 buildings** in New York City could be affected, including around **25,000 rental buildings** sold annually. Korchak emphasized that the potential delays could “devalue the buildings” and disrupt a wide array of stakeholders involved in property transactions, including attorneys, brokers, and financial institutions.

Citing the high stakes involved, Korchak elaborated that a **six-month wait** could freeze numerous transactions and lead to deals falling apart if nonprofits do not follow through. She added, “During that time, especially for a distressed owner, they have to continue to pay their taxes or risk falling behind.”

The legislation also raises concerns regarding the sale of properties held in corporate structures, which many owners utilize for liability protections. Korchak pointed out that while there are exemptions for property transfers following a death, these typically do not apply to corporate holdings. She noted the significant financial penalties for non-compliance, which do not differentiate between smaller and larger properties.

Many in the real estate community, including the **Hudson Gateway Association of Realtors**, argue that the proposed regulations would hinder market activity and limit fair transactions. They contend that the added bureaucratic requirements could deter potential buyers and complicate the selling process further.

Conversely, supporters of COPA highlight the potential benefits for community organizations and housing advocates. Brianna Soleyn from the **East New York Community Land Trust** shared a success story of a recent acquisition that revitalized a neglected building, stating, “Through COPA, the city can support acquisitions like these.”

Advocates stress that such measures are essential in addressing the **ongoing housing affordability crisis** in New York City. They argue that nonprofits can play a crucial role in creating and maintaining affordable housing options, thus benefiting the community at large.

As the New York City Council deliberates on this legislation, the implications of COPA remain a contentious topic. Small property owners fear that the additional layers of bureaucracy will complicate an already challenging real estate market, while advocates maintain that the law could lead to meaningful improvements in housing availability and affordability. The outcome of this legislation could reshape the landscape of real estate transactions in New York City, highlighting the ongoing tension between development, community needs, and property ownership rights.