Weekly Real Estate News
New York City’s Council approved legislation Thursday that would give certified nonprofit housing organizations the first opportunity to bid on certain apartment buildings before their owners sell to other buyers, a major proposed change to transactions involving distressed multifamily properties.
The Community Opportunity to Purchase Act, or COPA, passed the Council on October 22 by a reported vote of 38–9, with two abstentions. The measure, Introduction 905-A, now awaits mayoral action. It has not yet taken effect and should not be described as an operating requirement for property owners.
The legislation could affect approximately 2,100 properties, according to an estimate attributed to the city’s Department of Housing Preservation and Development (HPD). That is an estimate of potentially eligible buildings, not a count of buildings expected to be sold.
How the purchase process would work
Under the Council’s published text of Introduction 905-A, an owner planning to sell a covered property would notify HPD and certified qualified entities before taking action to sell.
Qualified nonprofit organizations, or joint ventures in which a qualifying nonprofit retains a controlling interest, would have 20 calendar days to submit a statement of interest. An interested qualified entity would then have 70 calendar days after that initial window closes to make a bona fide purchase offer. The owner could accept, reject or counter that offer.
If the owner later receives an outside offer it intends to accept under circumstances specified by the bill, the first qualified entity to make a qualifying offer could have 15 calendar days to match the outside buyer’s price, terms and conditions. The bill also sets deadlines for owners’ responses and contracts, so the 20-day and 70-day windows are not the full potential transaction timeline.
Which buildings are covered?
The measure is not a blanket right of first refusal covering every New York City apartment building. It applies to certain Class A multifamily buildings with at least four dwelling units that meet specific distress, enforcement, violation or affordability criteria. These include buildings in the city’s Alternative Enforcement Program, properties in specified foreclosure proceedings and some properties with substantial outstanding housing violations.
Owner-occupied properties containing five or fewer units would be excluded. The legislation also identifies exemptions for certain transactions, including refinancing that maintains ownership, judicial sales and qualifying family transfers.
Supporters and opponents disagree over the consequences
Supporters argue that allowing community land trusts and other nonprofits to compete early for vulnerable buildings can help preserve affordability and limit displacement. Opponents contend that the additional steps could complicate sales, slow closings and make it harder for distressed property owners to obtain financing or sell assets promptly.
Those effects remain projections, not measured outcomes. Whether the program improves affordability or reduces market liquidity will depend on implementation, the availability of nonprofit acquisition financing and the number of transactions involving covered properties.
Penalties and next steps
Under the Council text, an owner who sells a covered property without providing the required notice could face a civil penalty of up to 15% of the sale price. The legislation also provides for specified private legal actions by qualified entities and an undue-financial-hardship exemption process.
The Council’s legislative tracker lists the bill at the mayor’s desk for signature. Implementation would require additional administrative work by HPD, including certification of eligible nonprofit purchasers. The timing of mayoral action and final implementation guidance had not been confirmed as of publication.
Sources: New York City Council, Introduction 905-A and legislative history; Bisnow’s October 22 Council vote report.
