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The Elephant in The Title Report

Recorded development declarations, and the rights and restrictions they afford and impose on property and third parties, were a key due-diligence obstacle…

By Matthew Fogt - Associate in Allen Matkins land use and Real Estate Practice Groups. | Updated on December 09, 2011

Recorded development declarations, and the rights and restrictions they afford and impose on property and third parties, were a key due-diligence obstacle in several recent acquisitions of land and broken projects.

We’ll differentiate between development declarations, which govern the development phase of a project and typically terminate upon the conveyance to an end user, and association CC&Rs, which govern the long-term use and maintenance of a community. Understanding how development declarations work is essential to analyzing and underwriting potential acquisitions. An incomplete or inaccurate understanding can result in overpayment, unanticipated costs and delays or not being able to develop the property as anticipated.

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