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12/Sep/2018

With multiple partners, it’s important to determine who will be the primary owner of the building and what form that legal partnership will take.

United States

Sole Ownership

  • Most control and risk for the owner
  • Can be an existing organization or a new entity
  • Typically governed by a board of directors
  • Loans for the building are available based on the owner’s creditworthiness

Examples
The Nonprofit Center, Third Sector New England, Boston

Community Nonprofit Ownership

  • Nonprofits jointly create a new entity to own a building they jointly select
  • Governed by a nonprofit board of directors
  • Best fir creating a community asset
  • Loans based on guarantees and value of collateral
  • No equity interest for individual partners

Examples
Children & Family Services Center, Charlotte, NC

Limited Liability Corporation

  • Good for Cooperative ownership
  • Governed by an operating agreement
  • Member or manager-controlled management options
  • Owners can sell interest
  • Ownership interest need not correspond to occupancy
  • Can include outside investors
  • Loans based on guarantees and value of collateral.

Examples:
Ninth Street Independent Film Center, San Francisco, CA

Condominium Ownership

  • Each organization owns their unit
  • Requires creation and operation of a condo association
  • Enforcement of policies through bylaws, condo declaration, and deed covenants
  • Each organization acquires their own financing

Examples
Tides Thoreau Center NY, Tides, New York, NY
Youth Opportunity Center, Nashville, TN

 



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