"No Deed, No Cost": What It Actually Means

What is being promised?

That the cost of getting to a conversion sits with us until the deeds exist. There is no risk or cost to the corporation at any point before the closing, and our service fees are earned only if the conversion succeeds. No upfront fee is collected from the association or from a single shareholder, at any stage.

Who pays for the work in the meantime?

We do, and the list is longer than most boards expect. The legal costs, the architectural and engineering fees, the title searches, the document preparation and the administration of the conversion are all carried for you and covered by the one fee at the end. Every cost and every risk of the conversion is ours to carry, including the risk that your shareholders decline to approve it and the risk that the work fails on some financial or logistical obstacle nobody saw at the start. A shareholder who finances their share of the fee through AIP or the Group Fund is using an arrangement for paying that same fee, on the same terms as everyone else.

What if the vote fails?

We absorb it and come back. A co-op whose shareholders never approve the plan owes nothing for any attempt. Years of professional work can close out with your building having paid for none of it. That is the shape of the promise, and it is the reason we are careful about which buildings we take on.

How would your board check that any of this is true?

By reading the escrow instructions, which is where a promise like this is either kept or exposed. The conversion fees are treated as assessments in the resolution your members vote on, paid to the cooperative at the closing, placed into escrow, and not released to us until the deeds are recorded with the county. Your board does not have to take the arrangement on trust. It is written into the documents your own counsel will read before your shareholders vote on them.

Why would a firm work this way?

Because it puts the firm's money on the outcome your building actually wants. We are confident enough in these plans to fund them ourselves and collect at the end. It also settles the question every board is too polite to ask, which is what happens to a consultant's enthusiasm once the retainer has cleared. Ours has nowhere to go except a recorded deed.

What does it not cover?

A shareholder's own financing and closing costs, which belong to them and to their lender. Beyond those, and only where they apply, a shareholder has no other expense in the conversion. Most shareholders reach the closing without cash, because the conversion obligation can be financed into the new condominium mortgage along with an existing share loan.

Your board can test all of this against your own building before anything is signed. We will look at your unit count, your underlying loan obligation, your financial condition and your governing documents and tell your board what a conversion here would involve, at no cost and no obligation to the co-op or its members. A building we did not expect to reach a deed would be told so at that stage, because by then the money at risk is ours.