Tamarac Divorce: Splitting an Asset With an Expiration Date

The first step in a Tamarac case involving one of these communities is to determine the ownership structure precisely. Is the land owned by the association or leased from another party? Is the recreation facility owned or leased, and on what terms? How many years remain, what happens at expiration, and does the rent escalate? Those answers are in the declaration, the lease, and the association's documents, and they determine what the property is worth far more than its condition does.

The answers also determine what a buyer can do. Where the remaining term is long and the terms are reasonable, financing may still be available and the property behaves much like any other. Where the term is short or the rent escalates steeply, the market is cash and the price reflects a wasting interest. A settlement drafted without knowing which situation applies is drafted blind.

In an ordinary divorce, delay costs carrying charges — mortgage, taxes, insurance, maintenance. With a leasehold, delay costs those things plus the erosion of the asset itself. Every year that passes moves the property closer to the point where financing becomes unavailable, which is the threshold where value drops noticeably rather than gradually.

That argues for resolving the property early rather than treating it as the last item. Where one spouse intends to keep it, they should understand they are accepting a wasting asset and price it accordingly. Where neither does, selling promptly preserves more of what there is to divide. Competing written offers establish the current figure in days, which is exactly what a settlement needs to allocate it honestly.