Hello Listmates,

A client is currently evaluating the acquisition of a multifamily apartment building in Brooklyn.

The property is subject to a 421-a tax exemption, which is scheduled to expire next year. Upon expiration of the 421-a benefit, it is understood that all units would become eligible for transition to free market status.

With that in mind, I wanted to reach out to see if anyone has experience or insight into the technical process required to convert units to free market status, following the expiration of a 421-a exemption.

Specifically, I would appreciate any guidance on the following:

• The procedural steps required to effectuate the conversion with the relevant city agencies
• Any filings or notices that must be submitted (e.g., Department of Finance, DHCR, etc.)
• Whether there are any continuing affordability requirements or residual regulatory components (for example, any required percentage of units that must remain affordable post-expiration)

Any insight or guidance would be greatly appreciated.

Thank you in advance for your time and help.

Best regards,