You usually don’t hear much about a certificate of occupancy unless it’s a problem. Hopefully you’re reading this to avoid problems and haven’t encountered one yourself!
If you are thinking about new construction or conducting a major renovation, it’s important to understand what a certificate of occupancy is, why you need one and what to do if there is a problem.
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A certificate of occupancy (“CO”) states a building’s legal use and what type of occupancy is allowed. For example, retail space can be occupied by a store or restaurant. The landlord can't rent it out as an apartment if they feel like it.
To receive a CO, the Department of Buildings (“DOB”) will inspect the property and make sure it meets the necessary requirements.
Most importantly for apartment buyers, nobody is allowed to live in a building that does not have a CO.
If you're buying an apartment in a new building, it's important to know when the CO is expected. Any delay in the CO will also push back your closing. Remember - you can't live in a building without a CO and lenders usually won't close without one either.
Construction delays are most often the problem. Before issuing a CO, the DOB will inspect the property and look at critical components like the fire alarm, sprinklers, elevators, etc. If any of those are not ready, the CO will not be granted. In certain situations, a temporary certificate of occupancy can be issued (more on that later).
Buyers can also encounter CO issues in existing buildings. If the seller conducted unauthorized renovations, the CO may no longer match the property. For example, if the seller converted a single family home to a two family, the CO would no longer match the property and need to be updated. Generally this is only required after significant projects such as moving walls or adding rooms.
A temporary certificate of occupancy ("TCO") is simply one good for a limited amount of time, usually 90 days, and may only allow access to certain parts of the building.
They are often used when most of a building is finished but some non-critical parts still need work. For example, if only the top floor of a building is under construction, a TCO may be granted so residents on other floors can move in.
For work that requires more than 90 days, the TCO can be renewed.
A new building's CO is between the developer and DOB so there isn't much you can do to help there.
However, if an existing building’s CO need to be fixed, there are steps you can take. In order to navigate the myriad of forms that need to be completed, an expeditor is usually hired. They will know which forms to send where and at what time to update the CO as quickly as possible.
If the building is safe and does not deviate too far from the current CO, the solution is usually just a matter of time and cost.