E-Newsletter: Repeal of the Old Condominium Law, Chapter 514A

E-Newsletter: Repeal of the Old Condominium Law, Chapter 514A

Repeal of the Old Condominium Law, Chapter 514A Frequently Asked Questions

The repeal of the old Condominium Law, Chapter 514A (“514A”), has created some confusion among developers. Amidst this confusion, many questions have arisen for developers. Here are the most frequently asked questions in relation to the repeal of 514A the “old” condominium law.

What if a pertinent and/ or material change is made to a 514A project?

  • Developers considering a pertinent and/or material change to their 514A projects will be required to file an amended public report under 514B.
  • Developers must update their final report to comply with the public report standards set forth in HRS § 514B-83. Please feel free to contact an attorney for more information or to review your public report prior to submission.

What if I am a developer of a registered 514A project with remaining units to be sold?

            There are two options.

  1. Keep your 514A public report active and accurate on January 1, 2019, to ensure that your project meets requirements for an automatic transfer; or
  2. Apply for a transition to 514B pursuant to Act 244, SLH 2007.

 What if a developer of a registered 514A project is selling under a preliminary or contingent report?

  • Unfortunately, preliminary and contingent reports will not automatically transfer.
  • You may either apply to obtain a developer’s final report under 514A or transition to a 514B report pursuant to Act 244 SLH 2007.

As a developer, what is my timeline for extensions or supplementary reports?

  • It is recommended that any supplemental public report should be submitted to the Commission no later than August 2018 to ensure that your project will have an effective date on January 1, 2019.
  • Developers with no changes requesting extensions of the effective date of their projects for 13 months must make sure that the extended effective date will last through January 1, 2019.

Will the Commission notify a developer if their 514A project was transferred to 514B?

  • You will not receive any documentation from the Commission if your public report is automatically transferred.
  • You may check the Commission’s online database for the most recent active status of your project. Go to http://web.dcca.hawaii.gov/DPR.Net/Public/ShowPublicTable.aspx
  • If the database notes that your report is active and as of January 1, 2019, and there are no material changes to the project, then your project will have been automatically transferred.

What happens if a 514A project was not automatically transferred?

  • Unfortunately, if your report is not automatically transferred then all sales must stop.
  • Your registration with the Commission will need to be withdrawn.
  • You will be required to reregister your project as a new project under 514B.
  • To prevent this the developer needs to make sure that the public report is active and accurate by January 1, 2019. If any changes to your report are necessary be sure to file them with the Commission no later than August 2018.

What if a developer with a registered 514A project has sold all of its units?

  • You are in the clear. Your obligations to update the report ended with the sale of the last unit.
  • Please double check that you do not have any 514A projects with unsold units.

 What if a developer of an unregistered 514A project intends to sell units?

  • Unless you provided notice to the Commission prior to 2007, you must register your project as a 514B project.

Should you have any questions regarding the information in this newsletter, please contact us at (808) 521-9500.  If you wish to visit our Home Page, Facebook, or Linkedin, please feel free to click on the corresponding icons below.  

 

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