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Deconversion of Condominium Units: Addressing Multifamily Rental Needs in Tight Real Estate Market

Risks to Developers and Owners, Legal Process, Liability of Condominium Boards and Disclosures

Recording of a 90-minute premium CLE video webinar with Q&A

This program is included with the Strafford CLE Pass. Click for more information.
This program is included with the Strafford All-Access Pass. Click for more information.

Conducted on Thursday, October 20, 2022

Recorded event now available

or call 1-800-926-7926

The CLE webinar will address the deconversion of condominium units into multifamily rental units and the risks and benefits of this process. The panel will discuss the issues for developers and condominium ownership, the legal process, and the liability of condo board members who conduct a deconversion.


In the current real estate market, condominium deconversion offers developers and unit owners lucrative opportunities. Restrictions or prohibitions on leasing condominium units made it difficult for a non-occupying owner to generate income to pay the unit's ownership costs until the unit could be sold.

The low supply of new construction and large numbers of potential home buyers shut out of the housing market because of damaged credit or large student loans have created increased need. However, converting condominium buildings into rental properties can be more time-consuming and labor-intensive than acquiring an existing apartment building.

While investors can profit from a conversion, especially in developments where most units have failed to sell, owners who wish to stay can be at a loss. The legal process for deconversion is typically a combination of state law and the condominium's CC&Rs.

In Chicago, several large downtown properties that failed to sell have undergone deconversion into apartments, aided in part by Illinois state law that allows a condominium board to sell all units once 75 percent of owners agree to a sale.

A condo board contemplating such a sale should consider the issues when hold-out owners bring suit to stop the process. Boards act as fiduciaries for all owners and must avoid self-dealing, lack of full disclosure or candor or conspiratorial conduct with the deconverter, and act with good faith and loyalty to all condo owners.

Listen as our authoritative panel discusses deconversion of condominiums, the pros and cons for developers and owners, and how a board attempting this process must act to avoid liability.



  1. Deconversion of condominiums to apartments
    1. Developer issues
    2. Owner issues
      1. Hold-outs
    3. Legal process
      1. Chicago examples
    4. Condominium board liabilities
    5. Other best practices and considerations


The panel will address these and other key topics:

  • When should a condominium association consider a deconversion offer?
  • What can hold-out owners do to prevent a deconversion?
  • What liabilities does a condo board face when attempting a deconversion to apartments?


Kathryn Kovitz Arnold

Partner; Chair Real Estate Practice Group
Taft Stettinius & Hollister

Ms. Arnold is the Real Estate Practice Group Chair and also heads the firm’s Condominium Practice Group which...  |  Read More

Elmore, Kelly
Kelly C. Elmore

Principal; Chair of the Deconversion Department
Kovitz Shifrin Nesbit

Ms. Elmore advises condominium, homeowner, and townhome community associations on all aspects of corporate law...  |  Read More

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