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Governor Scott Signs Distressed Condominium Relief Act - Check Your Condo Documents

March 26, 2018

By: Alexander Dobrev

*This article, previously posted on Friday, March 23rd, has been updated to reflect late-Friday action by the Governor.*

The legislative session ended with a photo-finish last-hours-of-the-session maneuvering which resulted in the passage of HB 841, which among (many) other unrelated matters also removes the “sunset” provision of the Distressed Condominium Relief Act (“DCRA”).

The DCRA was set to expire on July 1, 2018.  More specifically, effective July 1, 2018, acquirers of distressed condominium units would no longer be eligible for the “bulk buyer” or “bulk assignee” classifications.

As a reminder, each of these classifications explicitly protect the acquirer (whether a lender enforcing its loan rights or a third party investor) against some significant liabilities which could be inherited from the original developer (a.k.a. "successor developer" liabilities), while allowing the new owner to retain certain useful and valuable rights with respect to the development, operations, and eventual disposition of the asset.

HB 841, in its final “enrolled” form, was presented to the Governor on Wednesday, March 21, 2018 at 4:17 PM. The Governor signed the bill into law on Friday, March 23, 2018 at 5:50 PM.

Even with the sunset removal, there have been a number of administrative and judicial interpretations of the DCRA sometimes severely limiting its applicability to certain distressed condominiums.  It is important to review (and if necessary or advisable modify) existing condominium documents so as to fully take advantage of the DCRA.

If you have any questions about the DCRA and how it may affect you, please contact Alex Dobrev or any member of the firm’s Distressed Condominiums Group.




Alex Dobrev is a shareholder and chairs the firm’s Multifamily & Condominium Group. He also serves as an executive officer of the Condominium & Planned Development Committee of The Florida Bar, and is frequently involved with the committee's legislative efforts.

Alex focuses a substantial portion of his practice on distressed properties acquisitions, operations and dispositions, as well as the creation of new condominium and mixed-used communities.

In the context of “broken” or “fractured” condominium projects in particular, he often works with lenders, bulk investors, and receivers to evaluate and implement exit strategies, including possible unwinding of the condominium regime, while identifying and minimizing potential successor developer liabilities and related risks. 

Alex also counsels clients regarding Interstate Land Sales Full Disclosure Act (ILSA) compliance matters, including full and partial exemptions from the Act and overall offering structure. 

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