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The Untapped Potential of NYC Co-Ops

NEW YORK CITY—Co-ops have several ways which they could explore monetizing untapped potential. These opportunities range from air rights sales, to…

By James Nelson | jamesnelson | Updated on February 05, 2016

James Nelson James Nelson

NEW YORK CITY—Co-ops have several ways which they could explore monetizing untapped potential. These opportunities range from air rights sales, to creating retail components, to selling the entire property outright. When shareholders come together with a proactive plan, they take the lead on what is best for their co-op, as opposed to letting a developer come in and try to dictate the terms.  This can sometimes turn out badly for the co-op shareholders, as reported in a recent NY Times article, How the Co-op Crumbles. Bad results might include some shareholders being bought out at a discount.

Today, many co-ops have substantial, unused development rights remaining. In this situation, the property may not currently be used for its highest and best value.   The building may be worth much more as development site, condo, or even as a single family home.  I have even discussed with co-op board presidents about the possibility of a developer building a deck above their building and constructing new apartments above. 

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