Academy/Developer / Declarant Transition
Annexation of future phases
When a developer can add new land to your community, and what happens to control when it does.
When a declaration reserves the right, the developer can annex later phases, known as additional real estate, into the community without a new owner vote. Whoever records the annexation amendment becomes the declarant for that phase. The exact recording, notice, and approval steps come from your state's statute and your own declaration, not a nationwide rule.
What annexation of a future phase actually means
Some communities are built to grow. A declarant can write the declaration to reserve the right to bring more land into the community later, land that is not part of the community yet but is described in the declaration as available to add. This is often called additional real estate, and a community built this way is sometimes called an expandable or flexible community.
The right has to be reserved up front. If the original declaration did not describe the additional land and the developer's right to annex it, the developer cannot simply decide later to fold in a new phase; adding land that was never reserved is a different, harder legal path.
Annexing a phase creates a new declarant for that land
Recording a new phase is not just a paperwork update to a map. Whoever executes the annexation amendment, the original developer or a successor who bought its remaining rights, becomes the declarant with respect to the newly added property, and picks up the development rights and obligations that come with that role for that phase.
Whether the annexed phase joins your existing association or forms its own, whether it resets or extends the declarant control period, and what obligations the new declarant owes the association for that phase all depend on the declaration's specific annexation language and your state's statute. Read your declaration's development rights section, not just the map, before assuming you know what a new phase changes.
The vote, notice, and recording rules are not the same everywhere
It is tempting to assume annexation works the same way turnover percentages do, one number, everywhere. It does not. Whether owners get notice before a phase is annexed, whether any vote is required at all, and how the amendment must be recorded all vary by state and by what your declaration specifically says.
Before your board reacts to news of a new phase, pull two documents: your state's common interest ownership or condominium act, and your own declaration's annexation and development rights clauses. A number you read about another association, or another state, is not your answer.
Check yourself
Answer before you read the explanation, recalling it is what makes it stick.
The declaration reserved the right to add Phase 2 as additional real estate. Two years later, the declarant records an amendment annexing Phase 2. Do current owners get to vote on it first?
The declarant records an amendment annexing Phase 3 into the community. Who holds the development rights over the new phase going forward?
A board member read that turnover happens at a certain percentage sold and assumes the same number controls when a newly annexed phase must be handed over. What should the board actually check?
Sources
- Uniform Common Interest Ownership Act, definitions of "special declarant rights" and "additional real estate" provisions, Uniform Law Commission
- Best Practices Report: Transition from Developer Control, Foundation for Community Association Research / Community Associations Institute (further reading on transition procedure)
Related elsewhere in the Academy
Developer / Declarant Transition
Next, pull your declaration's development rights section and check it against how phased developments work before your next board meeting.
Whether annexing a phase requires owner notice or a vote, how the amendment must be recorded, and what rights and obligations transfer with it all vary by state and by your declaration's specific annexation clause.