Converting the Faithful

Going from TIC to condo takes years and dollars—but here’s how to start.

Of all the things you can do to prove you’re a real San Franciscan, converting a TIC (tenancy in common) property to a condominium is probably one of the most challenging. First, there is the condo lottery, an initiation rite known to many local home owners, in which you pay $150 and hope that yours is one of only about 60 buildings chosen each year for conversion. Your chances of winning the lottery the first few times you enter are less than 10 percent, though with each year you reapply, your odds increase.

Then there are the constantly changing local laws governing both the lottery and how the occupancy histories of multiunit buildings affect their conversion. One recent change, for instance, prohibits a building from being converted if any “protected” tenant (that is, one who is aged 60 or over, who’s been in occupancy more than 10 years or who’s disabled) has been evicted since May 1, 2005, for any reason unrelated to the tenant’s behavior.

But let’s say you’ve cleared these hurdles. You’ve scraped together the money for your first TIC purchase, found partners who are stable and sane, either won or bypassed the lottery (as two-unit buildings that have been occupied by their owners for one year can do)—and in the process, the city hasn’t changed its mind. Congratulations! Now the real work begins.

Converting a TIC to a condo is a complicated endeavor that takes several years to complete. But every journey of a million miles begins with a single step, right? We talked to two local experts—
lawyers Andy Sirkin and Walter Parsley—to get their advice about where to begin.

To Pre-Inspect or Not to Pre-Inspect?
The bulk of the work and cost of conversion comes from the fact that you must upgrade your building to meet city specifications. In this process, the city sends out three inspectors—plumbing, electrical and general—to check out the building, and then tells you what repairs and upgrades you must make. After you complete the work, the city reinspects it to make sure all the requirements have been met. The cost of the work can range from almost nothing to tens of thousands of dollars. But here’s the catch: Once the city inspectors make their reports, the law states you must complete the specified repairs in six months, whether or not you follow through with condo conversion. That’s why some people hire private “pre-inspectors” to get an idea of what kind of financial commitment they’re looking at before they involve the city.
“If you have the city come in, you have...

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