Shopping new development in Brooklyn can feel exciting until you open the offering plan. The legal language, schedules, and exhibits can be overwhelming, especially when you are trying to compare buildings across neighborhoods. You want clarity on risks, costs, and timelines before you commit real money. This guide breaks the plan into practical pieces, highlights Brooklyn-specific issues, and gives you a step-by-step checklist to use before you make an offer. Let’s dive in.
What an offering plan is
An offering plan is the sponsor’s official disclosure package for a condominium. It is filed with the New York State Attorney General and sets the rules for the building and your rights as an owner. It covers unit boundaries, finishes, common charges, taxes, amenities, and closing procedures.
Think of the plan as your source of truth. Marketing materials are helpful, but the plan controls what is promised, what can change, and what you agree to at contract. Your attorney and lender will rely on it to assess risk and financing.
Start with special risks
What to look for
Open the “Special Risks” section first. It lists material issues like construction delays, pending litigation, environmental conditions, and dependencies on third-party approvals. Look for details on timelines, cost contingencies, and any approvals that must be secured before closings.
Brooklyn red flags
Brooklyn has both ground-up towers and conversion projects. Conversions may involve rent-regulated tenants, environmental cleanup, or historic preservation constraints. Red flags include broad disclaimers about estimates without support, a sponsor with unfinished projects or a history of extensions, and any litigation or stop-work orders that are not clearly explained.
Governance, bylaws, and declaration
Why it matters
Bylaws and the declaration set building governance. They define board control, voting rights, assessment rules, and use restrictions. They also outline sublet policies, short-term rental rules, pet rules, and alteration procedures that affect how you use or invest in the unit.
What to verify
- Sponsor control: how many board seats the sponsor can appoint and for how long.
- Voting thresholds: quorum requirements and votes needed to approve budgets, assessments, or amendments.
- Assessment authority: how special assessments are approved and any safeguards.
- Rental and sublet rules: approval steps, minimum terms, and any registration needs.
- Transfer costs: first right of refusal, flip taxes, and transfer fees that could affect resale.
Common red flags
Be wary of sponsor rights to amend key terms unilaterally, very low quorum rules that keep owners from gaining control, and strict or vague sublet clauses that limit flexibility for owners and investors.
Budget, common charges, and taxes
What to read
Study the first-year operating budget, reserve fund line items, tax allocation, utility assumptions, and insurance coverage. Read the footnotes to see how numbers were calculated.
Key verifications
- Taxes: confirm whether taxes are actual or estimates and whether a tax abatement or PILOT applies. Note any abatement end date and projected post-abatement taxes.
- Reserves: check the initial reserve fund and planned capital needs. Look for a realistic contingency for start-up issues.
- Utilities: see which services are individually metered and which flow through common charges.
- Insurance: understand master policy coverage and deductibles passed to owners.
- Allocation: verify your unit’s percentage interest, monthly common charges, and whether commercial space offsets residential costs.
Red flags
Zero or minimal reserve funding, tax abatements without post-abatement estimates, large unexplained contingency lines, or reliance on commercial income that is not leased or is uncertain are warning signs.
Finishes, upgrades, and punch lists
What is included
Review the finishes schedule for your specific line and unit. Confirm exact appliances, fixtures, cabinets, flooring, and any base trim. Identify what counts as an upgrade and the pricing.
Timelines and warranties
Note deadlines for making selections and paying for upgrades. Understand who completes punch list items, how to submit them, and the timeline for completion after you occupy. Check warranty terms for mechanicals, waterproofing, and appliances, and whether third-party warranties apply.
Red flags
Avoid vague descriptions like “builder’s standard” without specification pages. Watch for upgrade pricing that is not itemized or can change, and short or unclear warranty periods.
Sales, deposits, and closing timing
Deposits and escrow
Read the purchase agreement, deposit schedule, and escrow details. Confirm the amount, where funds are held, and the conditions for a refund or release. Know what triggers sponsor remedies and buyer default.
Interim occupancy fees
Many offering plans allow you to move in before closing under interim occupancy. Fees are typically based on common charges plus interest tied to the sponsor’s mortgage allocation. Confirm the formula and whether payments are credited to the purchase price.
Closings and CO/TCO
Understand whether the sponsor can close with a Temporary Certificate of Occupancy or only with a final Certificate of Occupancy. Brooklyn closings often depend on Department of Buildings sign-offs, utility connections, or other inspections, which can delay final COs and extend interim occupancy.
Red flags to watch
Large non-refundable deposits without strong escrow protection, broad sponsor extension rights with no buyer remedies for long delays, and non-creditable or opaque interim fee calculations are all concerns.
Financing and lender issues
Project approvals
Your loan options depend on lender and agency comfort with the project. Ask if the building is on approved lists or commonly financed by active lenders. Check whether any underlying construction loans create priority liens or restrictions.
Investor considerations
If you are investing, confirm any underwriting rules about owner-occupancy ratios or investor concentration. These metrics can affect both your loan and future resale.
Red flags
Lack of documentation that aligns with major lender expectations, or sponsor rights to mortgage common elements in ways that dilute owner protections, can limit financing and increase risk.
Pre-offer checklist for Brooklyn buyers
Use this quick checklist at first deposit meetings and open houses. Ask the sponsor’s team for written answers and exhibits when possible.
Get the full plan
- Obtain the complete offering plan with all exhibits. Do not rely on brochures or spec sheets.
- Confirm the sponsor’s identity, track record, and litigation history.
Verify your unit
- Check your unit’s percentage allocation for taxes and common charges.
- Confirm square footage measurement basis and line drawings.
- List base finishes, upgrade prices, and selection deadlines.
Review budget and taxes
- Ask how tax estimates were calculated and note any abatement or PILOT end date.
- Check reserve fund size and whether a start-up assessment is expected.
- Clarify which utilities are metered versus included.
Governance and restrictions
- Read bylaws for sponsor control, voting rules, and assessment procedures.
- Confirm sublet rules, minimum lease terms, and any approvals.
- Note first-right-of-refusal, flip taxes, and transfer fees.
Sales and closing mechanics
- Confirm deposit amounts, escrow bank, and refund conditions.
- Understand the interim occupancy fee formula and whether fees are credited.
- Ask what happens if closing is delayed and what remedies you have.
Construction and occupancy
- Confirm whether closings can occur with a TCO.
- Request the construction schedule and any staged closing plan.
- Ask how punch lists are handled and typical completion timelines.
Financing
- Get pre-approval and confirm your lender will finance the project.
- Ask about any project approval requirements and minimum down payments.
Tenants and commercial areas
- For conversions, obtain the tenant schedule and rent roll to understand occupancy.
- If there is retail or commercial space, confirm whether its costs or control rights affect residents.
Warranties and post-closing items
- Get warranty durations and claim procedures in writing.
- Ask whether any unfinished amenities are secured by bonds or escrow.
Professional review
- Have an experienced NYC real estate attorney review the full plan and contract.
- Consult your lender and, for conversions, a qualified inspector on unit condition.
Next steps
Your next moves are simple. Get the full offering plan and read the Special Risks, Governance, Budget, and Sales sections first. Schedule an attorney review and secure lender pre-approval to confirm financing. Ask the sponsor for written clarification on taxes, interim occupancy fee formulas, and any upgrade or amenity commitments.
If you want an experienced, development-aware partner to help you compare buildings, interpret plan details, and negotiate with confidence, connect with the Luxury Alliance Team. Schedule a consultation and get a clear plan from selection to closing.
FAQs
Can I move in before closing in Brooklyn new condos?
- Many plans allow interim occupancy before closing. You may pay fees based on common charges and interest on the sponsor’s mortgage share. Fees can be substantial and may or may not be credited at closing as stated in the plan.
How long do closings take on new developments in Brooklyn?
- Timelines vary by construction milestones and Department of Buildings sign-offs for TCO or CO. Expect possible delays and staged closings by unit or phase.
Will lenders finance a brand-new Brooklyn condo?
- Many lenders finance NYC condos, but approvals depend on project factors such as sponsor strength, percentage sold, investor ratio, and commercial exposure. Get pre-qualification and ask if the project needs formal approval.
What does sponsor control of the board mean for me?
- During the early phase, the sponsor may appoint board seats and run operations. You should know how long control lasts and what voting thresholds apply for budgets and amendments.
How do tax abatements affect carrying costs?
- Some buildings have abatements that reduce taxes for a set period. The plan should disclose the duration and post-abatement estimates. Model costs both during and after expiration.
What if the sponsor can change finishes or amenities?
- The plan lists the sponsor’s modification rights. Material changes should be disclosed. Look for amendment clauses that restrict unilateral changes and ask questions before signing.
