NY State Senate Bill 2023-S7825

Senate Bill S7825

2023-2024 Legislative Session

Limits the amount of rent increases for residential ground lease cooperative apartment buildings and establishes certain rights upon the expiration of such leases

download bill text pdf

Current Bill Status - On Floor Calendar

Introduced
- In Committee Assembly
- In Committee Senate
- On Floor Calendar Assembly
- On Floor Calendar Senate
- Passed Assembly
- Passed Senate
Delivered to Governor
Signed By Governor

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Actions

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	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Mar 28, 2024	advanced to third reading
Mar 27, 2024	2nd report cal.
Mar 26, 2024	1st report cal.719
Jan 03, 2024	referred to judiciary
Dec 20, 2023	referred to rules

Votes

- Mar 26, 2024 - Judiciary Committee Vote
  S7825
  
  10
  
  Aye
  
  8
  
  Nay
  
  1
  
  Aye with Reservations
  
  0
  
  Absent
  
  0
  
  Excused
  
  0
  
  Abstained
  - - Judiciary Committee Vote: Mar 26, 2024
      
      aye (10)
      
      Bailey
      
      Gounardes
      
      Hoylman-Sigal
      
      Liu
      
      Mayer
      
      Myrie
      
      Ramos
      
      Sepúlveda
      
      Stavisky
      
      Thomas
      
      nay (8)
      
      Canzoneri-Fitzpatrick
      
      Lanza
      
      Martins
      
      O'Mara
      
      Palumbo
      
      Rhoads
      
      Ryan
      
      Skoufis
      
      aye wr (1)
      
      Breslin

co-Sponsors

View additional co-sponsors

2023-S7825 (ACTIVE) - Details

See Assembly Version of this Bill:: A5031
Law Section:: Real Property Law
Laws Affected:: Add §233-c, RP L

2023-S7825 (ACTIVE) - Summary

Limits the amount of rent increases for residential ground lease cooperative apartment buildings; establishes certain rights upon the expiration of such leases.

2023-S7825 (ACTIVE) - Sponsor Memo

                                 
BILL NUMBER: S7825REVISED 1/23/24

SPONSOR: KRUEGER
 
TITLE OF BILL:

An act to amend the real property law, in relation to limiting the
amount of rent increases for residential ground lease cooperative apart-
ment buildings and establishing certain rights upon expiration of such
leases

 
PURPOSE:

This bill would limit rent increases for residential ground lease coop-
erative apartment buildings and establish certain rights upon the expi-
ration of such leases.

 
SUMMARY OF SPECIFIC PROVISIONS:

Section one adds § 223-c to the real property law to provide basic
protections to ground lease residential cooperative buildings located on
privately owned land. The bill grants these residential cooperative
buildings the right to renew the leases when they expire, the ability to

borrow money when necessary to pay for repairs and improvements not
withstanding prohibitions or limits in a ground lease, and the right of
first refusal if the landowner chooses to sell or transfer the land
underlying a building. It also limits annual ground rent increases to 3%
or the Consumer Price Index, whichever is greater.  The provisions of
this bill do not apply to ground lease residential buildings located on
land owned by the federal, state, or city government or authority, any
Indian nation or tribe, or any registered charity which purchased land
prior to January 1, 2023.

Section two contains a severability clause.

Section three establishes the effective date.

 
JUSTIFICATION:

There are dozens of residential cooperative buildings throughout New
York City containing thousands of homes that do not own the land under-
neath. Instead, private property owners lease the land to ground lease
cooperatives for set periods of time, and the buildings' residents make
rent payments to the landowner through their monthly maintenance fees.
When each building's lease is set to expire, an appraiser is tasked with
evaluating the land's fair market value, which is then used to negotiate
a rent increase between the landowner and the cooperative. Residential
cooperatives have extremely limited power in these negotiations since
the buildings cannot be physically moved, and existing laws do not
provide the right to lease renewal, limits on rent increases, or any
other protections. In this way, shareholders in ground lease cooper-
atives are in a similar position to manufactured home residents who own
their units but not the land on which they are located and cannot move
the structures.

In recent years, a growing number of owners of the land under ground
lease cooperatives have been demanding rent increases that are so exces-
sive that they put the financial viability of the residential cooper-
atives at risk. There are currently ground lease residential cooper-
atives that are facing rent increases as high as 1,000% from one year to
the next. While ground rent increases of this magnitude would be
extraordinarily difficult for any group of cooperative shareholders to
absorb, they threaten the very viability of the many residential cooper-
ative buildings which are occupied primarily by middle-income residents
on fixed incomes who have lived in their homes for decades. A number of
cooperative buildings with ground leases coming up for renewal in the
coming years face default due to the rent increases being demanded; this
would leave the longtime shareholders without their homes or any equity
while still owning mortgages on units that no longer exist. In certain
cases, the land under ground lease cooperatives has even been explicitly
marketed to prospective investors as an opportunity to obtain a prime
development site for a new luxury building once the existing residential
cooperative is unable to pay the rent demanded up on lease renewal, goes
into default, and is eventually demolished.

Many owners of the land under ground lease cooperatives have also
refused to allow buildings to borrow money required to perform critical
repairs and/or capital improvements. Numerous ground leases contain
language explicitly prohibiting cooperatives from taking on debt over
certain levels regardless of the circumstances. In some cases, property
owners have even prohibited ground lease cooperatives from borrowing
funds to perform repairs ordered by New York City agencies. Given the
high cost of maintaining aging buildings, along with the ongoing need to
make capital improvements to comply with changing laws, improve energy
efficiency and resiliency, and respond to emergencies, it is essential
for ground lease cooperatives to have the ability to borrow funds when
necessary.

As the housing crisis worsens, it is crucial that New York provide basic
protections to ground lease cooperative residents facing displacement
from their homes due to exorbitant rent increases and extremely limited
negotiating power in abnormal market conditions.  This legislation
simply builds upon established state laws granting manufactured home
residents basic rights during the lease renewal process, and if the land
under their homes is sold, by extending comparable protections to ground
lease residential cooperatives that similarly cannot move their build-
ings from the land underneath.

 
FISCAL IMPLICATIONS:

Undetermined.

 
EFFECTIVE DATE:
This act shall take effect immediately and shall apply to all existing
leases and to any renewals, amendments and other extensions of such
leases.

2023-S7825 (ACTIVE) - Bill Text download pdf

                             
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   7825
 
                        2023-2024 Regular Sessions
 
                             I N  S E N A T E
 
                             December 20, 2023
                                ___________
 
 Introduced  by  Sen. KRUEGER -- read twice and ordered printed, and when
   printed to be committed to the Committee on Rules
 
 AN ACT to amend the real property  law,  in  relation  to  limiting  the
   amount  of  rent  increases  for  residential ground lease cooperative
   apartment buildings and establishing certain rights upon expiration of
   such leases

   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section  1.  The  real property law is amended by adding a new section
 233-c to read as follows:
   § 233-C. RESIDENTIAL GROUND LEASE COOPERATIVE APARTMENT BUILDINGS.  1.
 WHEREVER USED IN THIS SECTION:
   (A) THE TERM "RESIDENTIAL GROUND LEASE COOPERATIVE APARTMENT BUILDING"
 MEANS  ANY  AND  ALL  BUILDINGS,  IMPROVEMENTS  AND/OR  OTHER STRUCTURES
 LOCATED IN THE STATE OF NEW YORK OCCUPIED, OWNED AND/OR LEASED IN  WHOLE
 OR  IN PART BY A GROUND LEASE RESIDENTIAL COOPERATIVE, OR ANY SUBSIDIARY
 OR AFFILIATE THEREOF, PURSUANT  TO  A  SUBJECT  RESIDENTIAL  COOPERATIVE
 GROUND LEASE.
   (B) THE TERM "GROUND LEASE RESIDENTIAL COOPERATIVE" MEANS ANY NEW YORK
 CORPORATION  ORGANIZED  AND/OR  OPERATING  AS A HOUSING DEVELOPMENT FUND
 CORPORATION, NEW YORK COOPERATIVE CORPORATION AND/OR COOPERATIVE HOUSING
 CORPORATION, INCLUDING ANY ENTITY MEETING  THE  DEFINITION  THEREOF  FOR
 FEDERAL INCOME TAX PURPOSES, OR ANY PERSON OR ENTITY THAT IS A TENANT IN
 COMMON, CO-TENANT OR JOINT OWNER WITH ANY SUCH CORPORATION, OR WHICH IS,
 DIRECTLY  OR  INDIRECTLY  THROUGH  A  SUBSIDIARY OR AFFILIATE THEREOF, A
 PARTY TO A SUBJECT RESIDENTIAL COOPERATIVE GROUND LEASE.
   (C) THE TERM "SUBJECT RESIDENTIAL COOPERATIVE GROUND LEASE" MEANS  THE
 LEASE  AGREEMENT,  TOGETHER  WITH ANY AMENDMENTS OR OTHER RELATED AGREE-
 MENTS INCLUDING ANY FORBEARANCE, SETTLEMENT, TENANCY IN COMMON OR  OTHER
 SIMILAR  AGREEMENTS  RELATED  THERETO,  PURSUANT TO WHICH A GROUND LEASE
 RESIDENTIAL COOPERATIVE LEASES, OCCUPIES AND/OR OTHERWISE USES FOR RESI-
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD02744-04-3

 S. 7825                             2
 
 DENTIAL, COMMERCIAL, OR OTHER ANCILLARY PURPOSES THE GROUND  LEASE  REAL
 PROPERTY FROM ONE OR MORE SUBJECT GROUND LEASE OWNERS.
   (D)  THE  TERM  "GROUND  LEASE REAL PROPERTY" MEANS ALL REAL PROPERTY,
 INCLUDING IMPROVEMENTS THEREON, ALL OR ANY PORTION OF WHICH  IS  LEASED,
 RENTED,  LICENSED  OR OTHERWISE PROVIDED FOR USE TO A GROUND LEASE RESI-
 DENTIAL COOPERATIVE PURSUANT TO A SUBJECT RESIDENTIAL COOPERATIVE GROUND
 LEASE, INCLUDING ANY PORTION THEREOF THAT MAY BE SUBLEASED OR  OTHERWISE
 USED FOR ANCILLARY RETAIL, PARKING, OR COMMERCIAL PURPOSES.
   (E)  THE  TERM "SUBJECT GROUND LEASE OWNERS" MEANS ANY AND ALL PERSONS
 OR ENTITIES (WHETHER NATURAL  PERSONS,  ESTATES,  TRUSTS,  CORPORATIONS,
 PARTNERSHIPS  OR  OTHER  ENTITIES), OTHER THAN ANY EXCEPTED GROUND LEASE
 OWNER, THAT HOLDS TITLE TO AND/OR IS THE OWNER (WHETHER BY THE ENTIRETY,
 AS TENANTS IN COMMON OR OTHERWISE) OF GROUND LEASE REAL PROPERTY  AND/OR
 IS  OTHERWISE  THE  LANDLORD  UNDER  ANY SUBJECT RESIDENTIAL COOPERATIVE
 GROUND LEASE.
   (F) THE TERM "EXCEPTED GROUND LEASE OWNER"  MEANS  THE  UNITED  STATES
 FEDERAL GOVERNMENT, THE STATE OF NEW YORK, THE CITY OF NEW YORK, AND ANY
 AGENCY,  MUNICIPALITY  OR  POLITICAL SUBDIVISION OF ANY OF THE FOREGOING
 THEREOF, ANY ENTITY OWNED OR CONTROLLED BY ANY OF THE FOREGOING, INCLUD-
 ING, WITHOUT LIMITATION, THE BATTERY PARK CITY  AUTHORITY,  ANY  CHARITY
 APPROVED  UNDER  SECTION  501(C)  OF  THE  INTERNAL  REVENUE  CODE WHICH
 ACQUIRED ITS INTEREST AS THE OWNER AND/OR LANDLORD  OF  A  GROUND  LEASE
 REAL PROPERTY PRIOR TO JANUARY FIRST, TWO THOUSAND TWENTY-THREE, AND ANY
 INDIAN  NATION,  TRIBE OR BAND AS DEFINED UNDER TITLE TWENTY-FIVE OF THE
 UNITED STATES CODE, BUT SHALL EXCLUDE ANY  "PRIVATE  FOUNDATION"  WITHIN
 THE MEANING OF SECTION FIVE HUNDRED NINE OF THE INTERNAL REVENUE CODE.
   (G)  THE  TERM  "BASE RENT" MEANS FOR ANY YEAR THE PAYMENTS, INCLUDING
 ANY CONSUMER PRICE INDEX OR OTHER  SIMILAR  ADJUSTMENT  PAYMENTS,  OTHER
 THAN  ADDITIONAL  RENT,  REQUIRED TO BE MADE TO THE SUBJECT GROUND LEASE
 OWNERS FOR SUCH YEAR  PURSUANT  TO  A  SUBJECT  RESIDENTIAL  COOPERATIVE
 GROUND LEASE.
   (H)  THE TERM "ADDITIONAL RENT" MEANS, FOR ANY YEAR, THE AMOUNTS SPENT
 OR BORNE BY THE GROUND LEASE RESIDENTIAL COOPERATIVE  DURING  SUCH  YEAR
 PURSUANT TO, OR IN ORDER TO COMPLY WITH, THE SUBJECT RESIDENTIAL COOPER-
 ATIVE  GROUND  LEASE  FOR  THE  PAYMENT OF REAL ESTATE TAXES, INSURANCE,
 REPAIR, MAINTENANCE, INCLUDING, WITHOUT LIMITATION, MAINTENANCE  AS  MAY
 BE REQUIRED PURSUANT TO ANY FACADE INSPECTION SAFETY PROGRAM IMPLEMENTED
 BY ANY CITY, MUNICIPALITY OR OTHER GOVERNMENT ENTITY WITHIN THE STATE OF
 NEW  YORK,  AND/OR OTHER CAPITAL IMPROVEMENTS FOR OR WITH RESPECT TO THE
 RESIDENTIAL GROUND LEASE COOPERATIVE APARTMENT BUILDING.
   (I) THE TERM "MAXIMUM ANNUAL RENT INCREASE PERCENTAGE" MEANS, FOR  ANY
 YEAR, THE GREATER OF: (X) THREE PERCENT (3%); AND (Y) THE CONSUMER PRICE
 INDEX  (FOR  ALL  URBAN  CONSUMERS,  U.S.  CITY  AVERAGE, ALL ITEMS, NOT
 SEASONALLY ADJUSTED), AS PUBLISHED BY THE UNITED  STATES  DEPARTMENT  OF
 LABOR FOR SUCH YEAR.
   (J)  "COMMISSIONER"  MEANS THE COMMISSIONER OF THE DIVISION OF HOUSING
 AND COMMUNITY RENEWAL.
   2. ANNUAL INCREASES IN BASE RENT PAYABLE BY ANY GROUND LEASE  RESIDEN-
 TIAL  COOPERATIVE  SHALL,  WHEN  TAKEN  TOGETHER  WITH THE AMOUNT OF ANY
 INCREASES IN ADDITIONAL RENT PAID BY THE GROUND LEASE RESIDENTIAL  COOP-
 ERATIVE  DURING  THE  PRIOR  YEAR, IN NO EVENT EXCEED THE MAXIMUM ANNUAL
 RENT INCREASE PERCENTAGE OF THE BASE RENT PAYABLE BY  THE  GROUND  LEASE
 RESIDENTIAL  COOPERATIVE  IN  THE  PRIOR  YEAR. IN THE EVENT THE SUBJECT
 RESIDENTIAL COOPERATIVE GROUND LEASE PROVIDES FOR INCREASES IN BASE RENT
 ON A PERIODIC BASIS LESS FREQUENTLY THAN ANNUALLY, THE INCREASE IN  BASE
 RENT  FOR  ANY PERIOD, WHEN TAKEN TOGETHER WITH THE AMOUNT OF ANY ANNUAL
 S. 7825                             3

 INCREASE IN ADDITIONAL RENT PAID BY THE GROUND LEASE RESIDENTIAL COOPER-
 ATIVE DURING SUCH PERIOD, MAY  NOT  REPRESENT  MORE  THAN  THE  COMPOUND
 INCREASE  THAT  RESULTS  FROM  APPLYING THE MAXIMUM ANNUAL RENT INCREASE
 PERCENTAGE  FOR  EACH  APPLICABLE YEAR ABOVE THE BASE RENT FOR THE PRIOR
 BASE RENT IN EFFECT. THE PROVISIONS  OF  THIS  SUBDIVISION  SHALL  APPLY
 REGARDLESS  OF  THE  METHODOLOGY  FOR  DETERMINING  THE BASE RENT OR ANY
 INCREASES THEREIN AS SET FORTH IN THE  SUBJECT  RESIDENTIAL  COOPERATIVE
 GROUND  LEASE  INSTRUMENT.  IN  THE  EVENT THE AMOUNT OF ANY INCREASE IN
 ADDITIONAL RENT DURING ANY YEAR EXCEEDS THE MAXIMUM ANNUAL RENT INCREASE
 PERCENTAGE OF THE BASE RENT FOR SUCH YEAR, SUCH EXCESS AMOUNT  SHALL  BE
 CARRIED FORWARD TO REDUCE THE AMOUNT OF ANY INCREASE IN BASE RENT OTHER-
 WISE  PERMITTED HEREUNDER IN ANY FUTURE PERIOD UNTIL SUCH EXCESS AMOUNTS
 HAVE BEEN FULLY APPLIED.
   3. AFTER THE EFFECTIVE DATE OF THIS SECTION,  ANY  RESIDENTIAL  GROUND
 LEASE  COOPERATIVE SHALL HAVE THE RIGHT TO RENEW ITS SUBJECT RESIDENTIAL
 COOPERATIVE GROUND LEASE ON THE SAME TERMS AND  CONDITIONS,  SUBJECT  TO
 THIS  SECTION,  AS IN EFFECT AT TIME OF RENEWAL, WITH SUCH RENEWAL EXER-
 CISABLE AT ANY TIME PRIOR TO OR WITHIN NINETY DAYS AFTER HAVING RECEIVED
 WRITTEN NOTICE FROM THE SUBJECT GROUND LEASE OWNERS OF THE EXPIRATION OR
 TERMINATION OF THE SUBJECT RESIDENTIAL  COOPERATIVE  GROUND  LEASE.  ANY
 RENEWAL  TERM  PURSUANT  TO  THE FOREGOING SHALL BE EQUAL TO THE TERM OF
 SUCH SUBJECT RESIDENTIAL COOPERATIVE GROUND LEASE PRIOR TO SUCH  EXPIRA-
 TION  OR  TERMINATION  AND SHALL OCCUR AUTOMATICALLY, UNLESS THE SUBJECT
 RESIDENTIAL COOPERATIVE GROUND LEASE  AFFIRMATIVELY  ELECTS  TO  NOT  SO
 RENEW AND HAS PROVIDED WRITTEN NOTICE OF SUCH NON-RENEWAL TO THE SUBJECT
 GROUND LEASE OWNERS.
   4.  AFTER  THE  EFFECTIVE DATE OF THIS SECTION, ANY RESIDENTIAL GROUND
 LEASE COOPERATIVE  SHALL,  NOTWITHSTANDING  ANYTHING  TO  THE  CONTRARY,
 INCLUDING  PROHIBITIONS  OR SPECIFIED DOLLAR LIMITATIONS, SET FORTH IN A
 SUBJECT RESIDENTIAL COOPERATIVE GROUND LEASE, HAVE THE AUTHORITY,  RIGHT
 AND  POWER TO INCUR INDEBTEDNESS OR OTHERWISE BORROW MONEY, AND TO GRANT
 A FIRST MORTGAGE AND/OR OTHER SIMILAR SECURITY INTEREST  ON  OR  IN  THE
 GROUND  LEASE  APARTMENT  BUILDING  WITH RESPECT TO SUCH INDEBTEDNESS OR
 BORROWED MONEY, OF ANY AMOUNT, IF THE PRIMARY PURPOSE  OF  SUCH  INDEBT-
 EDNESS  AND/OR  BORROWED  MONEY  IS  TO PROVIDE PROCEEDS OR OTHER CREDIT
 SUPPORT TO PAY OR FUND ADDITIONAL RENT  OR  OTHERWISE  PERFORM  REPAIRS,
 MAINTENANCE  OR  OTHER  CAPITAL  IMPROVEMENTS  ON OR WITH RESPECT TO THE
 GROUND LEASE REAL PROPERTY AND/OR THE GROUND LEASE APARTMENT BUILDING.
   5. (A) IF, AFTER THE EFFECTIVE  DATE  OF  THIS  SECTION,  ANY  SUBJECT
 GROUND  LEASE  OWNER  PROPOSES  TO  DIRECTLY OR INDIRECTLY SELL, ASSIGN,
 EXCHANGE, OR OTHERWISE TRANSFER ANY DIRECT OR INDIRECT INTEREST  IN  ANY
 GROUND  LEASE REAL PROPERTY, INCLUDING, WITHOUT LIMITATION, ANY INDIRECT
 HYPOTHECATION BY WAY OF TRANSFERS OF INTERESTS IN  ANY  ENTITY  THAT  IS
 ITSELF  A  SUBJECT GROUND LEASE  LANDLORD OR AN OWNER THEREOF AND/OR THE
 SUBJECT   RESIDENTIAL COOPERATIVE   GROUND   LEASE ITSELF,  THE  SUBJECT
 GROUND  LEASE  OWNER  SHALL PROVIDE THE RESIDENTIAL GROUND LEASE COOPER-
 ATIVE WITH WRITTEN NOTICE THEREOF CONTAINING THE  PRICE  AND  ALL  OTHER
 TERMS  AND  CONDITIONS OF SUCH DIRECT OR INDIRECT PROPOSED SALE, ASSIGN-
 MENT, EXCHANGE, TRANSFER, OR OTHER SIMILAR CONVEYANCE.  THE  RESIDENTIAL
 GROUND  LEASE  COOPERATIVE SHALL HAVE THE RIGHT TO PURCHASE THE INTEREST
 BEING SOLD, ASSIGNED, EXCHANGED, TRANSFERRED, OR CONVEYED  AT  THE  SAME
 PRICE  AND  ON  SUBSTANTIALLY  SIMILAR TERMS AND CONDITIONS BY PROVIDING
 WRITTEN NOTICE TO THE SUBJECT GROUND  LEASE  OWNER  WITHIN  ONE  HUNDRED
 TWENTY  DAYS  OF  RECEIPT  OF THE AFOREMENTIONED WRITTEN NOTICE FROM THE
 SUBJECT GROUND LEASE OWNER. THE CLOSING OF THE PURCHASE BY THE  RESIDEN-
 TIAL  GROUND  LEASE  COOPERATIVE  SHALL  OCCUR WITHIN THE TIME FRAME AND
 S. 7825                             4
 
 PURSUANT TO PROCEDURES ADOPTED BY THE COMMISSIONER PURSUANT TO PARAGRAPH
 (D) OF THIS SUBDIVISION.
   (B)  IF  AN  OFFER TO PURCHASE BY THE RESIDENTIAL GROUND LEASE COOPER-
 ATIVE IS NOT DELIVERED WITHIN SUCH ONE HUNDRED TWENTY DAY PERIOD,  THEN,
 UNLESS  THE  SUBJECT GROUND LEASE OWNER THEREAFTER ELECTS TO DIRECTLY OR
 INDIRECTLY SELL, ASSIGN, EXCHANGE, OR OTHERWISE TRANSFER ANY  DIRECT  OR
 INDIRECT  INTEREST  IN  ANY  GROUND LEASE REAL PROPERTY AT A PRICE LOWER
 THAN THE PRICE SPECIFIED IN THE NOTICE TO THE RESIDENTIAL  GROUND  LEASE
 COOPERATIVE  OR  ON TERMS DIFFERENT FROM THOSE PRESENTED TO THE RESIDEN-
 TIAL GROUND LEASE COOPERATIVE, THE SUBJECT GROUND  LEASE  OWNER  HAS  NO
 FURTHER  OBLIGATIONS UNDER THIS SECTION, UNLESS THE SUBJECT GROUND LEASE
 OWNER DOES NOT DIRECTLY OR INDIRECTLY SELL, ASSIGN, EXCHANGE, OR  OTHER-
 WISE  TRANSFER  ANY DIRECT OR INDIRECT INTEREST IN ANY GROUND LEASE REAL
 PROPERTY IN ACCORDANCE WITH THE FOREGOING WITHIN ONE HUNDRED TWENTY DAYS
 AFTER THE EXPIRATION OF THE ONE HUNDRED  TWENTY  DAY  PERIOD  COMMENCING
 WITH DELIVERY OF THE WRITTEN NOTICE OF THE PROPOSED SALE TO THE RESIDEN-
 TIAL  GROUND  LEASE  COOPERATIVE,  IN WHICH CASE THE PROVISIONS OF PARA-
 GRAPHS (A) AND (C) OF THIS SUBDIVISION SHALL CONTINUE TO APPLY.
   (C) IF THE SUBJECT GROUND LEASE OWNER, AFTER SUCH ONE  HUNDRED  TWENTY
 DAY  PERIOD, ELECTS TO DIRECTLY OR INDIRECTLY SELL, ASSIGN, EXCHANGE, OR
 OTHERWISE TRANSFER ANY DIRECT OR INDIRECT INTEREST IN ANY  GROUND  LEASE
 REAL PROPERTY AT A PRICE LOWER THAN THE PRICE SPECIFIED IN THE NOTICE TO
 THE  RESIDENTIAL  GROUND  LEASE  COOPERATIVE  OR ON TERMS DIFFERENT FROM
 THOSE PRESENTED TO THE RESIDENTIAL GROUND LEASE  COOPERATIVE,  THEN  THE
 RESIDENTIAL GROUND LEASE COOPERATIVE SHALL BE ENTITLED TO NOTICE THEREOF
 AND  SHALL  HAVE  AN ADDITIONAL ONE HUNDRED TWENTY DAYS AFTER RECEIPT OF
 NOTICE OF THE REVISED TERMS TO DELIVER TO THE SUBJECT GROUND LEASE OWNER
 A WRITTEN NOTICE INDICATING EXERCISE OF SUCH  RESIDENTIAL  GROUND  LEASE
 COOPERATIVE'S  RIGHT  TO  PURCHASE WHICH MEETS THE REVISED PRICE, TERMS,
 AND CONDITIONS AS PRESENTED BY THE SUBJECT  GROUND  LEASE  OWNER.    THE
 CLOSING  OF  THE  PURCHASE  BY SUCH RESIDENTIAL GROUND LEASE COOPERATIVE
 SHALL OCCUR WITHIN THE TIME FRAME AND PURSUANT TO PROCEDURES ADOPTED  BY
 THE COMMISSIONER PURSUANT TO PARAGRAPH (D) OF THIS SUBDIVISION.
   (D)  THE  COMMISSIONER  SHALL  ADOPT THE PROCEDURES IN CONNECTION WITH
 THIS SUBDIVISION NO LATER THAN ONE YEAR AFTER THE EFFECTIVE DATE OF THIS
 SECTION TO GIVE EFFECT TO CLOSING TERMS AND CONDITIONS  ASSOCIATED  WITH
 ANY PURCHASE AND SALE CONTEMPLATED BY THIS SUBDIVISION.
   (E)  THIS  SECTION  DOES  NOT  APPLY TO PURCHASES OF GROUND LEASE REAL
 PROPERTY BY A GOVERNMENTAL ENTITY UNDER ITS POWERS OF EMINENT DOMAIN.
   § 2. If any clause, sentence, paragraph, subdivision, section or  part
 of  this act shall be adjudged by any court of competent jurisdiction to
 be invalid, such judgment shall not affect, impair,  or  invalidate  the
 remainder thereof, but shall be confined in its operation to the clause,
 sentence,  paragraph,  subdivision,  section  or  part  thereof directly
 involved in the controversy in  which  such  judgment  shall  have  been
 rendered. It is hereby declared to be the intent of the legislature that
 this act would have been enacted even if such invalid provisions had not
 been included herein.
   §  3.  This  act  shall take effect immediately and shall apply to all
 existing leases as of such effective date and to  any  renewals,  amend-
 ments and other extensions of such leases.

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