FAQs: What is a CPR?
Most people are familiar with a condominium, yet many may not be aware that a Residential Condominium can be created on a lot whereby there are two or more residences that are part of a condominium. You may see this in areas are where there is larger acreage and the HOA allows CPRS, such as Launiupoko in West Maui.
In the MLS you will see a Main Home (call it Condo A), an Ohana (call it Condo B), and sometimes a designated area for Ag use only (call it Condo C).
The DCCA Hawaii notes in "So You want to go Condo" that a CPR or Condominium Property Regime is a "specific form of ownership and governing process created when real property is submitted to the condominium property regime, a process often referred to as CPRing a property." Essentially, a Condominium Property Regime (CPR) is a legal framework used to divide a single property into two or more separate units of ownership.
Here are some key points about CPRs:
Division of Property: A CPR allows a single property to be legally divided into multiple units of ownership, each with its own separate ownership and TMK (Tax Map Key) number. These units can be independently sold or leased. CPRs can apply to a range of property types, from offices, single family homes and agricultural plots. (1)
Legal Mechanism: The process of creating a CPR is governed by the Hawaii Revised Statutes. It may involve the creation of "appurtenant exclusive-use limited common elements" like yard areas, which are areas exclusively used by the unit owner. Maintenance may be the responsibility of the owner or maintained by the CPR association.
Ownership and Governing Process: CPRs establish a specific form of ownership and a governing process when real property is converted into a condominium. This conversion is recognized as the ownership of an apartment (or unit) along with a percentage of undivided interest in the common elements of the property. In the case of a residential CPR, you may see common elements such as shared driveways or fences, and limited common elements such as yard spaces that are exclusively for the use of the condominium owner.
Requirements: For a property to be submitted under a CPR, it must contain two or more units as defined by Hawaiian statute. This means that the process is not just limited to high-rise buildings or traditional condominiums but can also apply to various types of real estate, including detached homes and townhouses. The CPR must be registered with the DCCA before being offered for sale, and file the Developer's PUblic Report, which is a disclosure statement for prospective purchasers. This will include a description of the condominium project, including the permitted uses, restrictions, warranties and encumbrances. (1)
- Considerations: Interested parties should have an attorney review the CPR documentation to verify permitted uses and to understand their liability and responsibility for any common areas. This can be important should a buyer wish to make changes to the structure or use of the property. As with any purchase, it is recommended the Buyer verify all permits have been finalized by the County.
Overall, the CPR concept in Hawaii provides a unique and flexible way to manage and own property, reflecting the state's specific needs and conditions. It can allow financial flexibility for a land owner to develop their parcel, sell off the main home or ohana, and keep the remainder.
Interested parties should consult the appropriate county agency to determine applicable land use and zoning requirements. This information is provided using the following resources which are subject to change:
Courtney M. Brown, R(S) & Team
Island Sotheby's International Realty