When looking into the different vehicles available for investing in U.S. residential real estate, whole asset ownership seems like the best fit for us. We prefer to own real estate directly. We are curious though to know what the advantages and disadvantages might be between the two for a foreign investor.
The condominium route has many more layers, with an additional set of condominium documents (agreements, bylaws, plans, etc.) that must be recorded in the applicable registry of deeds, and any such amendments, requiring the consent of the condominium board of trustees and of the unit holders of the condominium, with the amendments recorded as well. Given the added work that the condominium documents present for property ownership, the whole asset or "regular fee" ownership is typically used.
The benefit to condominium ownership versus the ownership of the asset in its entirety is simply to be able to sell off or separately finance different part or components of a building or a project. A condominium creates an operating regime by which a building or a project can be separated into different units owned by different parties (even if they are affiliated). It is most common in a mixed-use project so that, for example, the residential component is owned separately from the retail and/or office and/or hotel component, but the advantage is only gained if there is a plan, at some point, so have different owners or to sell different components to different parties, or to separately finance each component. If none of that is contemplated, ownership if the asset would generally be preferable due to the ultimate simplicity, which is better understood by buyers, sellers and lenders.
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