AGG Real Estate partner Andy Much authored an article published by Multi-Housing News on August 24, 2022, highlighting how Project Covenants can be effectively used to ensure the success of mixed-use developments, especially those with lengthy project lifespans.
“Declarations of covenants, conditions, and restrictions for mixed-use development projects (Project Covenants, often referred to as “Master Declarations” or “CC&Rs”) may not be the most exciting component of the project development process, but the failure to timely and properly complete them can profoundly impact the orderly development of new projects, as well as the ongoing control and evolution of existing projects,” Andy said. “By following certain practical considerations, developers, their counsel, and their development professionals can successfully utilize Project Covenants to advance their vision.”
Project Covenants should be filed of record prior to the first property conveyance to an unrelated third party in order to minimize the leverage that a purchaser or lessee of property within the project may have to complicate or delay Project Covenant negotiations, or to extract concessions or modifications. Because project site plans often evolve, a developer as the initial “declarant” under the Project Covenants should have broad, unilateral authority to amend Project Covenants to the fullest extent permitted by local law to take actions.
Much explained how these Project Covenants, when established early, can protect parties’ rights as it relates to required easements, specified property uses, common areas, future revenue streams, property control and governance, design, assessments, parking, and ongoing amendments and modifications.
To read the full article, please click here.