Until 550 Vanderbilt gets full residential sell-through, Sponsor will control condo board, thanks to provision re retail ownership

Guess what: the 550 Vanderbilt condo may be nearly sold out, but until all 278 residential units are sold, the sponsor, Greenland Forest City Partners, will retain control of the building's board.

That's a provision in the original 6/8/15 Offering Plan, which is re-asserted in the most recent amendment, Amendment 19, submitted to the state Attorney General on 9/9/21, excerpted below.

Though the "Sponsor Control Period"--defined as until 90% of units/shares are sold-- is no longer in effect, the Sponsor can retain control as long as it still owns at least one unsold residential unit.

That's because, until there's a residential sell through, the Sponsor gets one of the four board seats designated by the Residential Unit Owners--and the Sponsor, as owner of the three Retail Units, gets three more seats.

(So, with the retail owners having three of seven seats on the board, it's kind of... skewed. I'm not sure how common this is, but it was disclosed to potential buyers.)

The document cites board members as including residential unit owners Karen Wilkson, Emi D’Orville, Wishart Edwards, plus four people affiliated with the Sponsor: Scott Solish, designated by the Sponsor as residential owner, and Livia M. Corredor, Xin Li, and John Bowen, designated by the Sponsor as retail owners.

Controlling Common Charges

The Offering Plan offered this disclosure:

Until Sponsor no longer designates a majority of the members of the Board, Sponsor will, through its control of the Board, be able to control the maintenance and operation of, and the services to be provided by, the Condominium, and also the determination of Common Charges to be paid by all Unit Owners, provided that maintenance and operation of, and the services to be provided by, the Condominium, shall at all times be substantially consistent with the maintenance and operation of and the services to be provided by the Condominium as budgeted for in Schedule B herein. Prospective Purchasers should be advised that Unit Owners, Unit occupants and non-resident Unit Owners, including Sponsor, may have inherent conflicts on how the Condominium should be managed because of their different reasons for purchasing, i.e., for use as a home as opposed to as an investment.

So that leaves the Sponsor in charge of determining the monthly Common Charges paid by unit owners--and raises the possibility for conflicts (though none have publicly surfaced).