As condo buildings age interest in condo corporation terminations is likely to increase.
In British Columbia legislation is being updated to allow for terminations. Yet it is in Florida where the greatest number of problems may exist.
In Florida, condo terminations were originally intended as a way to aid condo corporations that operate old or damaged buildings, or those which may have been neglected. Where rebuilding or repairing a condo building is deemed too costly, 100% of owners could agree to terminate the corporation. Terminating a condo corporation allows owners to sell the building. In 2007 this Florida law was updated to allow termination with the support of 80% of owners so long as fewer than 10% objected.
When property values dropped, investor and other groups benefited from this law. These groups purchased condo units in distressed buildings and were able to meet the legal threshold for termination. They were then able to force remaining owners to sell at much lower values.
In Ontario, the Condo Act (Part VIII) specifies the conditions under which a termination is allowed. These conditions include “substantial” damage to the property and any reason supported by 80% of owners. Terminations must be approved by the courts.