Condominiums – No Longer Subject to Interstate Land Sales Act (ILSA Law)

On September 18, 2014 the US Senate unanimously approved amendments which will have the effect of removing condominium developments from application of ILSA.  The amendment becomes effective 180 days after signed by the President, which is expected given overwhelming bi-partisan support in the Senate and House.  ILSA was enacted in the 1960’s to protect consumers from large development lot sale scams. Before changes to the law, developers of condominiums containing more than 99 units were technically required to register under ILSA, and many argued for years that application to condominiums was not what was originally intended, and did not really have any additional positive protective effect for purchasers.  The fact that developers will not have to comply with this very cumbersome law should be a great relief to developers, one that will hopefully be one more encouragement to commence larger scale condominium projects.

For more information, this link will take you directly to the version of the bill approved by the US Senate:

Please call any of the attorneys in our Commercial Development Practice Group if you have any questions about ILSA, or any other legal issues related to commercial real estate development.