Combining Two Apartments in Tribeca
Apartment combinations are not as daunting as one might think. As is always the case, smart planning is essential.
1. Consider the fit and feasibility: Some apartments align beautifully, others do not. Work with an architect who is familiar with combination filings to develop a plan that fits with your short- and long-term goals. Other factors to consider:
Is it a horizontal or vertical combination? Vertical combinations (duplexes) are structurally more complicated hence, more costly. Either way, HVAC and electrical systems will have to be integrated and minimum DOB standards will have to be met including egress, energy, fire protection, natural light and air, safety and structural;
Is it a co-op or a condo? If a condo, your lawyer and architect will need to work in tandem to file for a tentative lot number before the DOB will consider reviewing your submittal. If your plan to include some of the common area (hallway) space, it is considerably less complicated to do so in a co-op (typically just a matter of issuing more shares) vs. a condo where the common area is licensed and could be revoked in the future. A co-op’s alteration agreement often clarifies whether combinations are permissible. If so, consider whether the new unit will trade for the same price per square foot and appreciate at the same rate as a similar apartment in a larger building. Consider as well, the implications of being a majority shareholder in a co-op and that the board may ask for proof of your ability to manage the construction and carrying costs;
Is it a Landmarked Building? Filing a project for a landmarked building is typically more involved than a regular filing even if no modifications to the exterior are contemplated;
How do the finish levels of the two units compare? It is important for resale that the combination appears seamless. This may require some modifications to your current unit as well as the new;
Are you on good terms with the board, building management, and building Super? If so, it will be easier to navigate the bureaucratic intricacies of the filing and construction process;
Have other units in the building been combined particularly in the same line? The board may wish to limit ownership percentages
2. Assess your all-in costs: Once you’ve approved a floor plan, an experienced architect can provide you with a reasonable estimate of construction and filing costs. You will also want to pull comps of apartments that match the size of your combination. If yours will be priced the same or higher but does not have a sensible layout, you may want to reconsider. Other cost factors:
Fees for your architect and specialty consultants including engineers (HVAC, structural, sprinkler), asbestos and fire-stop inspectors, expeditor and lawyer(s);
Your carrying costs including mortgage, maintenance fees, and temporary accommodations for the construction period;
The square-footage of the two lots registered with the Department of Finance to project your future common charges/taxes;
Does the building allow sublets so you can rent out the acquired unit while you plan for the renovation?
3. Location, location, location:
Do you love the building and neighborhood – restaurants, subway access, parks, etc.?
Is the building well-maintained and financially stable?
Do the units in your building tend to sell quickly?
Are good schools nearby or easily accessible?
Yes, buying the adjacent unit could be the opportunity of a lifetime, but not always. Some smart planning will help you decide.