The Amendment provides developers with additional flexibility and protection as they recover from the housing crisis.
Recently, Pennsylvania Governor Tom Corbett signed into law House Bill 1122 (the "Amendment"), which amends the Uniform Condominium Act and the Uniform Planned Community Act (together the "Acts") by extending the time period for a developer—which the Acts refer to as a declarant—to exercise certain special declarant rights.
The Acts allow the declarant to reserve special declarant rights that permit the declarant to merge or consolidate two or more units into a single unit and to delegate some or all of the responsibilities of a unit owner's association to a master association. Prior to the Amendment, the Acts limited the time that a declarant could exercise these special declarant rights to seven years from the recording date of the declaration.
The Amendment extends the time limitation to merge or consolidate units and to delegate responsibilities to a master association from the current seven-year period to a period from the recording of the declaration not to exceed 10 years for projects that are not built in phases. For projects that will be built in phases, the time limit to exercise these rights may not exceed 120 days after: a.) the municipal approval or denial of each particular section’s final plat that was filed prior to the deadline approved or modified by the municipal governing body pursuant to the Municipalities Planning Code; or b.) a final judgment on appeal if there was an appeal of the municipal approval or denial of the final plat.
The Amendment provides developers with additional flexibility and protection as they recover from the housing crisis. Significantly, the Amendment retroactively applies to declarations that have been recorded within the past seven years. However, to potentially take advantage of the Amendment, a developer may want to amend the declaration to record these changes. To obtain the protections and additional rights granted to developers by the Amendment, developers also should consider amending their declarations to take advantage of the full protections offered by the law.