In a co-op setting, who owns the apartment building?
A corporation usually referred to as a “co-op corporation” typically owns the entire building. The co-op corporation then issues a proportionate number of shares of stock in the co-op corporation for each apartment in the building and issues a proprietary lease for each apartment. Typically, the number of shares of stock allocated to an apartment depends on the size of the apartment, in connection with other factors, such as whether the apartment has a terrace, for example. The apartment “owner” is referred to as a “proprietary lessee” or “tenant-shareholder.” Frequently, the co-op corporation takes out a mortgage on the entire building. The monthly mortgage payment on the building’s mortgage is then built into the monthly “maintenance” charge paid by all of the apartment owners, and is divvyed up on a proportionate basis. Therefore, as a technical matter, an owner of a co-op apartment may actually be paying off two mortgages – – the first being the mortgage on his or her particular ap
