Common Charges In Mixed-Use Condominiums

Condominium boards that operate buildings with both commercial and residential units frequently ask us for assistance in disputes involving the calculation of common charges.

Determining common charges in buildings that are completely residential is typically straightforward — the board develops a budget and then divides the projected common expenses among the units based on each unit's respective percentage of the common interest. However, in a mixed-use building where there are both commercial and residential units, the New York Condominium Act permits them to be allocated common charges differently where authorized by the condominium's declaration and bylaws. Unfortunately, in our experience, boards and managing agents often refer to the condominium's offering plan for a description of how common charges are to be billed, without checking the bylaws and declaration as recorded in the City Register, resulting in mischarges.