Case Study

Mountain Club Condos

702-unit Morris Plains conversion

Property location

2467 NJ-10, Morris Plains, NJ 07950

702

Total Units

State

Property details

Context that shaped the conversion

These project specifics help explain why the conversion path and results differed from one building to another.

Year Built

1968

Underlying Mortgage

Yes (Underlying Mortgage, Fees & Closing Cost)

The transformation

From constraints to outcomes

Each project began with a specific set of financing, legal, or market challenges and moved through a different path to a successful outcome.

Before conversion

The constraints

A large complex (702 Units) converted from rentals in 1988, the co-op units never recovered in sales prices from the decline in the early 1990s. Owners were forced to rent due to low resale values, making the community more tenant-concentrated than was desired.

As a co-op, owners were limited in their options to refinance or get home equity loans since unit values remained low compared to the loan amount they needed.

There was significant deferred maintenance in the complex and virtually no reserves to fund the necessary work.

After conversion

The documented outcomes

After conversion, unit values doubled and market absorption significantly improved. Investor owners were able to sell their units to owner-occupants at higher prices thereby increasing the owner occupancy levels in the community.

As part of the conversion, Hutton secured Fannie Mae & FHA approval which provided the best available mortgage terms for years to come.

Almost $2.5 Million was raised through the conversion, allowing owners to borrow their share in conversion loans.

Project record