Renting of a Clubhouse

Started by AlexL1 • 5 replies • 1450 views

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AlexL1 (Florida)
Posts: 305

Posted:

Does this ever happen? The renting of the office part of a club house? If it does, what type of people...... what type of office would be interested in renting it? Keeping in mind that if(for example only) an insurance office rented it, they would want signs out front advertising where they are and this would be forbidden of course... Has anyone had any experiences on this subject?

GlenL (Ohio)
Posts: 5,491

Posted:

Alex we don't have an office in our clubhouse so we've never had that come up but I suppose it could be rented to a member of the HOA. Our AOI prohibits the Association from: Nothing in these Articles of Incorporation or in the By-Laws shall authorize the corporation to, and the corporation shall not, enter into any transaction, carry on any activity, or engage in any business for Pecuniary profit. So we couldn't rent it to someone outside the HOA. As far as the sign issue goes ours states no signs unless approved by the BOD however the section on home businesses specifically prohibits signs that identify a business. Our CC&R's also disallows an outside employee (c) no person is employed other than residents permitted to reside in the unit under Section 7.1.A (1).

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SusanW1 (Michigan)
Posts: 5,202

Posted:

Alex - why not? of course some restrictions would apply, especially with advertising, signage and traffic flow. But I think someone who wants a private office would jump at the chance. Be sure to have a contract and set hours of operation. Much pre-planning would have to be done.

re: "profit" realized. the cost of running that building could be off-set by the rental income. This rent could pay for the heat and lights, at least. There most likely would be no profit realized.

RobertR1 (South Carolina)
Posts: 5,164

Posted:

As always, you must check your documents to see if there is no restriction on renting property. In our condo we rent out a community room and kitchen to outsiders. Actually we are very strict about who it is rented to. I doubt we could rent out office space, this would require a lease or contract and entail a lot of legal preparation. But I bet it is done often at many places for any number of reasons. I would also think the act of renting should have some justification in the documents or maybe a board resolution......depending.

RuthH1 (Maryland)
Posts: 8

Posted:

Good Day, some attention should be given to the tax status of the HOA. profit or non-profit? Just a thought...

MaryA1 (Arizona)
Posts: 7,043

Posted:

Ruth,

I don't believe this would compromise their tax status; however, they will have to pay taxes on the rental income.

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