Common Interest Development

The McKenna Long & Aldridge (MLA) Common Interest Development Team is the largest of its kind in California. With more than 10 attorneys and a team of paralegals in San Francisco, Los Angeles, Orange County and San Diego, specializing in all aspects of residential, mixed-use, commercial, and industrial projects, we are able to provide our clients with the legal advice and documentation to meet every need arising during the development and sales process. From small standard subdivisions, to 12,000-unit master-planned developments; to mixed-use hotel, retail, commercial and residential high-rise projects; we have the experience needed to assist our clients with every stage of the development process. Because we have such a large team of attorneys and paralegals we can work on short time frames and on multiple projects, but we are also able to efficiently and cost effectively represent clients on real estate development projects.

Innovative Approaches

Our team has developed innovative new approaches for common interest developments. For example, in connection with its representation of the master-planned communities at Otay Ranch, MLA developed the concept of an incremental budget which is now routinely used by major master-planned communities in order to phase their communities. MLA established the first environmental association to deal exclusively with properties facing environmental challenges. Recently, we have worked with the Bureau of Real Estate/BRE (formerly Department of Real Estate/DRE) to obtain approval of an “unoccupied unit” budget to reduce assessment to the developer for unsold units in a down market. In several mixed-use projects, we have worked closely with the Bureau of Real Estate to obtain waivers of many of the BRE regulatory requirements to facilitate the approval process. These are just a few of the examples of the creativity and ability of MLA to develop approaches to benefit its clients.

Customized Client Solutions

We approach each project and each client individually. While it may be possible to develop generic documents that get a development from the planning stages to be ready for sale, our view is that this provides little useful information to the buyers, no protection to the developer and creates an atmosphere that is ripe for litigation. We have templates to be used as a starting point, but not as the end result. We have experience with a wide range of projects to use as models for the next project. Tailoring those models and templates to fit the features of your project, the philosophy of your company and the experience of your personnel is the key to a successful project.

We create consistent programs, with emphasis on risk management, to take projects from mapping to construction to sales including:

Project Development and Governance

Project Formation Documentation

Construction

BRE Approval (Residential and Mixed-Use Including Residential)

Assist in obtaining Bureau of Real Estate approval, made more efficient by the use of our Master Management Documents which have received pre-approval from the California Bureau of Real Estate.

Preparation of Complete Sales Package

Association Formation and Turnover Process

Distressed Common Interest Developments

During the current real estate market downturn, MLA’s Common Interest Development Team is using its experience to assist lenders, bulk purchasers and developers with a variety of issues involving common interest developments. From dealing with restructuring current projects to make them more economically viable, to addressing issues of substantial delinquencies within owners associations, and working with the Bureau of Real Estate to obtain approvals to allow for modified sales programs or to permit new sellers to sell residential communities to bulk purchasers or individual buyers, our team is prepared to provide advice and assistance.

As leaders in the field of common interest developments, we are able to provide quick and efficient document reviews of projects we were not originally involved in and assist the parties in spotting issues and structuring transactions or analyzing issues in the pre- or post-foreclosure context. We are able to assist new sellers of existing distressed projects in developing sales programs which are appropriate to the circumstances, including compliance with state and federal laws. In the area of risk management, we can advise on existing insurance and dispute resolution programs to determine if they are appropriate to the distressed project. We are also able to evaluate construction defect or other liabilities for parties such as lenders, who did not originally construct the project. Several of our counsel have in-depth experience representing lenders as well, which provides a deeper understanding of the finance-related issues involved with distressed projects.

Related Services

Through our long history of working on projects in California, MLA has developed and continues to retain an excellent relationship with the current and past Real Estate Commissioners, together with other members of senior management and deputies at the Department of Real Estate. MLA has also been and remains an active participant, including playing a leadership role within the building industry, both at the state and local level. The trust and confidence which the Bureau of Real Estate and the Building Industry Association have placed in MLA is evidenced by the following positions which members of our group have held in the past or currently hold:

MLA’s Common Interest Development Team has the breadth of expertise to efficiently and creatively assist with almost every aspect of the development process.