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Has anyone here had experience with buying out a rent-regulated tenant in a coop? What if the tenant approaches you and ASKS to be bought out?
Specifically, I'm talking about a rent-controlled (NOT rent-stabilized) tenant in an apartment that's owned by the coop. Assuming the buyout goes through, the apartment will be sold as a standard cooperative unit, with all proceeds going into the coop's reserve fund.
What did you offer? What factors did you take into account in determining the price? Was your buyout successful?
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We recently sold three former renter units for record high prices for our complex after the renters move out and we completely the units. We sold two for $342k each (record high price for any unit) and one for $331k (record high price per share) - all two bedrooms. We spent an average of $40k each on renovations. The net proceeds went into capital funds and we are now repairing our roofs without a loan or an assessment.
We did not have to buy the renters out - they either passed away or moved into a nursing home.
If someone is asking you to buy them out, talk to your lawyer and accountant to see if $10k or $25k makes sense (or lower). It sounds like they are interested anyway so you may not have to pay top dollar to get them to move.
By they way, the quality of the renovation makes a huge difference. These units need to be renovated as an owner would revovate them and not as a rental owner would renovate them.
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