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Fla. Stat. § 718.704

Assignment and assumption of developer rights by bulk assignee; bulk buyer.

sirsreservessb-4dbudgetpost-surfsidestructuralsafetyassessments

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Plain-English summary

Common Elements summary — Section 718.704 is the other half of Florida's post-Surfside reform and is, for boards, the more financially consequential one. It requires every condominium association with a building three stories or taller to commission a Structural Integrity Reserve Study (SIRS) by December 31, 2024, and every 10 years thereafter. The SIRS is a visual inspection plus a 30-year funding projection for these specific items: roof; load-bearing walls and other primary structural members; floor; foundation; fireproofing and fire protection systems; plumbing; electrical systems; waterproofing and exterior painting; windows and exterior doors; and any other item with a deferred maintenance or replacement cost over $10,000 that, if not maintained, will negatively affect any of the above. The bombshell is the funding mandate. For SIRS items, the association MUST fund reserves at the level the study requires. Owners cannot vote to waive or reduce SIRS reserves — the historical 718.112(2)(f)(4) waiver right is dead for these line items. For many South Florida associations this has meant 50-100% special-assessment increases starting with the 2024 budget. Some buildings have voted to terminate the condominium rather than fund the SIRS-mandated reserves; the termination market is real and growing. For boards: get a SIRS engineer on contract now if you don't have one, and start communicating the funding consequences to owners 12 months ahead of each budget cycle. Surprise SIRS assessments are how recalls happen.

Not legal advice. Statute reference is for education only — confirm citations on official sources and consult a Florida attorney for your situation.

Statutory text

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A bulk assignee is deemed to have assumed and is liable for all duties and responsibilities of the developer under the declaration and this chapter upon its acquisition of title to units and continuously thereafter, except that it is not liable for: (a) Warranties of the developer under s. 718.203

or s. 718.618, except as expressly provided by the bulk assignee in a prospectus or offering circular, or the contract for purchase and sale executed with a purchaser, or for design, construction, development, or repair work performed by or on behalf of the bulk assignee. (b) The obligation to: 1. Fund converter reserves under s. 718.618 for a unit that was not acquired by the bulk assignee; or 2. Provide implied warranties on any portion of the condominium property except as expressly provided by the bulk assignee in a prospectus or offering circular, or the contract for purchase and sale executed with a purchaser, or for design, construction, development, or repair work performed by or on behalf of the bulk assignee. (c) The requirement to provide the association with a cumulative audit of the association’s finances from the date of formation of the condominium association as required by s. 718.301(4)(c). However, the bulk assignee must provide an audit for the period during which the bulk assignee elects or appoints a majority of the members of the board of administration. (d) Any liability arising out of or in connection with actions taken by the board of administration or the developer-appointed directors before the bulk assignee elects or appoints a majority of the members of the board of administration. (e) Any liability for or arising out of the developer’s failure to fund previous assessments or to resolve budgetary deficits in relation to a developer’s right to guarantee assessments, except as otherwise provided in subsection (2). The bulk assignee is responsible only for delivering documents and materials in accordance with s. 718.705(3). A bulk assignee may expressly assume some or all of the developer obligations described in paragraphs (a)-(e).

A bulk assignee assigned the developer right to guarantee the level of assessments and fund budgetary deficits pursuant to s. 718.116 assumes and is liable for all obligations of the developer with respect to such guarantee upon its acquisition of title to the units and continuously thereafter, including any applicable funding of reserves to the extent required by law, for as long as the guarantee remains in effect. A bulk assignee not receiving such assignment, or a bulk buyer, does not assume and is not liable for the obligations of the developer with respect to such guarantee, but is responsible for payment of assessments due on or after acquisition of the units in the same manner as all other owners of condominium parcels or as otherwise provided in s. 718.116.

A bulk buyer is liable for the duties and responsibilities of a developer under the declaration and this chapter only to the extent that such duties or responsibilities are expressly assumed in writing by the bulk buyer.

An acquirer of condominium parcels is not a bulk assignee or a bulk buyer if the transfer to such acquirer was made: (a) Before the effective date of this part; (b) With the intent to hinder, delay, or defraud any purchaser, unit owner, or the association; or (c) By a person who would be considered an insider under s. 726.102.

An assignment of developer rights to a bulk assignee may be made by a developer, a previous bulk assignee, a mortgagee or assignee who has acquired title to the units and received an assignment of rights, or a court acting on behalf of the developer or the previous bulk assignee if such developer rights are held by the predecessor in title to the bulk assignee. At any particular time, there may not be more than one bulk assignee within a condominium; however, there may be more than one bulk buyer. If more than one acquirer of condominium parcels in the same condominium receives an assignment of developer rights in addition to those rights described in s. 718.703(2), the bulk assignee is the acquirer whose instrument of assignment is recorded first in the public records of the county in which the condominium is located, and any subsequent purported bulk assignee may still qualify as a bulk buyer.

Synced from the Florida Legislature’s official site. Verify the current version before citing.

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