In the Dirt: A Real Estate Legal Update

On July 12^th, Missouri Governor Parsons signed HB 2062, a House Bill that, beginning this August, may ruffle a few feathers of those developers, directors, homeowners, and others associated with Missouri homeowner associations (HOAs).

Banks own and operate a surprising amount of real estate for their branches and offices. There were over 77,500 bank branches in America as of the end of 2023. By comparison, McDonalds has about 13,000 stores in the US. That’s a lot of property, and it comes with a lot of legal considerations.

A seemingly small win for birds could potentially have big implications for builders. A recent court of appeals decision may impact commercial buildings and construction.

Developer beware! In Wisconsin, assessors may use an “anticipated” vacancy in making assessments.

The City of Milwaukee (and various other municipalities) has sent its Biennial Property Tax Exemption Report and Filing Fee Notices. Owners of tax-exempt real property in Wisconsin must file a Form PC-220 Tax Exemption Report (the “Report”) by March 31, 2024, to ensure their property is properly classified and continues to be recognized as tax-exempt. The Report must be filed with the clerk of the town, village, or city in which the property is located biennially of each even numbered year.

On February 7, 2024 FinCEN issued a Notice of Proposed Rulemaking that FinCEN issued a Notice of Proposed Rulemaking that would require certain professionals involved in real estate closings and settlements to report information to FinCEN about non-financed transfers of residential real estate to legal entities or trusts. FinCEN’s proposal targets residential real estate transfers considered high-risk for money laundering.

On October 10, 2023, the Indiana Supreme Court denied a landowner’s petition to transfer filed  in the matter of State of Indiana v. The Market Place at State Road 37, LLC, et al., 22A-PL-2765 (May 17, 2023), and as a result, did not consider certain novel issues presented by the owner’s chain of title. The Market Place at State Road 37, which owns property near the intersection of State Road 37, now I-69, and Fairview Road in Greenwood, Indiana, sought to introduce evidence at trial of damages associated with the elimination of that intersection, which was located approximately 350 feet from the owner’s Fairview Road access.

As digital currency grows in use and acceptability, digital currency has entered into many traditional investment markets. Commercial real estate is no exception. The conversion of real estate assets to digital tokens using blockchain technology (“tokenization”) is continuing to grow, with a market size of approximately $200 million, real estate tokens account for nearly 40% of the digital securities market.

Property owners (“Owners”) interested in engaging in short-term leases should carefully consider the structure of their contracts (“Leases”). Anticipating potential disputes and consequences is essential for avoiding future litigation. A well-written Lease can serve to facilitate friendly, productive, and profitable landlord/tenant relationships. A good Lease can also help insulate Owners from liability and unnecessary expenses related to the short-term rental of their property.

Short-term rentals have become a complex topic for many municipalities, which in turn affects homeowners or Homeowner Associations interested in the issue. Various objectives of the governing body in regard to regulating short-term rentals may affect their treatment of this issue. While one municipality may want to revitalize its vibrant downtown by encouraging short-term rentals, another may prefer to crack down on short-term rentals altogether to preserve neighborhoods with single-family homeowners. The interests of property owners who wish to earn extra income from short-term rentals must be weighed against their neighbors who desire calm and predictable surroundings. Here's what municipalities making decisions regarding short-term rentals must also consider.