Builder Assignment of Storage and Parking

Started by MarthaD1 • 4 replies • 1710 views

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MarthaD1 (California)
Posts: 5

Posted:

I live in a new community. The builder assigned parking spots based upon size of units, some getting 1 spot, some 2. These spots are to be transferred upon sale of the units, but not by way of deed. The management company is simply to note the transfer in their records.

Similarly, individual storage rooms in the garage are assigned to some units. Most units were not assigned a storage unit. As the builder sold off units (and probably needed funds) he offered for sale the assignment of storage rooms and parking spaces. Nothing is recorded on the deeds. I bought a storage unit and some of my neighbors bought multiple units. For instance, a neighbor who is a CPA bought seven to store client records.

Since the date the builder has relinquished control of the community many other neighbors have asked to buy storage and parking spaces. There are many storage units, and some parking spaces. However, as a board we see no authority in our CC&Rs to offer the community's property for sale by way of assignment. We are also concerned that the builder had no authority to collect and keep funds from individuals for these assignments.

Does anyone have a situation like this? We have sought advice of multiple counsel and are not getting any quick or clear answers. The management company manages many locations and is unfamiliar with this scenario.

FredS7 (Arizona)
Posts: 927

Posted:

> We have sought advice of multiple counsel

Do you mean you have asked several lawyers and they all say different things??

MelissaP1 (Alabama)
Posts: 13,836

Posted:

Sounds like to me if the builder is no longer involved and the owners are responsible, you all can decide how to handle the situation. It's the owner's that make up the rules now. Simply make a rule regarding if there will be a purchase requirement for these spaces or delegate it as "common property". It's within the power of the board and owners to modify the rules they live by now that you are all in charge. The way to do it is in the documents. It's usually a majority vote of owners to change your doc's.

I would suggest creating a committee to review the existing rules and documents to make changes. You want to make sure to remove ALL references to the builder in them. This will effect other parts of the documents such as the voting system and who qualifies to be on the board. It's good to have a lawyer familiar with contractual/corporate law to help out. However, keep that assistance to a minimum to contain costs.

Your HOA can decide to sell these lots and storage spaces whenever the property changes hands. They could decide to assign parking. There are many options but the most important part is now the owner's get to decide. A HOA is only run by it's members for it's members...So you all make the rules!

Former HOA President

CarolR11 (Colorado)
Posts: 2,563

Posted:

Martha, as you'll see, there aren't many posters at this site that are in HOAs with a garage with parking & storage lockers. Is it an underground garage in a high rise or mid rise? Or some other kind of garage?

I wasn't an original owner in my high rise HOA with an underground garage and locker areas in which there are individual storage lockers. But all of the parking spaces and storage lockers are deeded to the units, and they also are in every building in our urban high rise neighborhood. This was done by the developer and the parking spaces & storage lockers were included in the sales price. No owner has more than two pk. spaces & one locker and all have been deeded, i.e., there are no "extras."

The developer did retain 1 pk. space that he's currently offering for sale for $25,000.

This actually is a pretty complicated topic that I think really requires a real estate attorney who specializes in HOA's like yours. I wouldn't want to "own" a parking sp. & storage locker that wasn't on my deed. But if your HOA does go ahead and deed them & lockers to those who purchased them, the ratio of HOA-owned property/separate interest property will change and conflict with the original Condo Plan that your developer filed with the Dept. of Real Estate.

I feel like I'm already over my head here, but your board certainly needs professional advice.

MarthaD1 (California)
Posts: 5

Posted:

I have asked the question of multiple lawyers, about the propriety of the original sales and whether we can do future rentals or sales. We have had one lawyer ask the developer for his authority (because our lawyer could not find authority) and we are waiting for a response. Another lawyer has scoured our documents, including those filed with DRE. There seems to be no cases on point. We do need to amend our documents to remove references to the builder. The builder had the power to assign parking and storage, but that power was not transferred to the resident board.

We are a 2 & 3 story, 3 building location with underground parking serving all units. The storage spots are also in the garage. I believe the building plans for storage were that each unit would have a storage room in the garage. However, the units were not sold that way and there is nothing in the deeds nor designation of exclusive use common area for these assignments.

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