A condominium is simply a form of ownership that divides a property into areas that are exclusive to one or a number of owners, with a community organization to oversee the entire property. The type and size of what can be a condominium are not subject to any state limits. However, all county zoning, ordinances, regulations, permits, and rules must be followed by the owners and developers in how they develop or use the property.

Single family homes, residential skyscrapers, agricultural pastureland, apartments and townhouses, harbor slips, storage lockers, parking stalls, and industrial warehouses are some examples of what can be condominimized.

Why do people choose to create a condo?

Anyone who chooses to create a condominimized property becomes a developer regardless of the size of their condominium project. Developers choose the condominium path for assorted reasons.

Many times, developers will want to add a few units to a plot of land, but the local county won’t approve a subdivision, so the developer will choose to add condominiums instead. This allows the developer to subdivide the property into units to sell to buyers. They may even sell existing homes on these units, or may leave constructing a county permitted dwelling up to the buyers.

The condominium process is also used in estate planning, creating units on a property that their children will inherit. This could be a single owner creating two units from one property, whereby the owner is the developer. It is a strategy to avoid some conflict among heirs over what to do with the land after the owner’s passing.

Large developers will divide a building or property into many condominium units, from residential and commercial towers to rows of townhomes around retail businesses.

What is a CPR or Residential Condo?
CPR – Condominium Property Regime, often called a “Residential Condo” in search phrases, could be of interest to anyone looking into the Maui real estate market. So, what is a CPR?

In the State of Hawaii, a property may be divided into separate “condo” units (units of ownership) with a related limited common element. As a result, even though the underlying land remains one parcel, each “unit” and its associated limited common elements are further defined by a condominium map and plan.

Why utilize a CPR and not subdivide? It may not be possible to subdivide (for example, it may not be a sufficient lot size or have adequate infrastructure) or it may not make economic sense. The CPR ‘condo units’ may seem like single-family homes, built as separate structures, having no distinguishable shared common elements, but in the legal sense are condominiums.

When assessing a CPR unit, what would be allowed in the parcel zoning and building codes must be considered. For instance, if a property is agriculturally zoned, one of the CPR units is designated as the ‘main residence’ and the other as a ‘cottage,’ however, the cottage cannot exceed 1,000 sq. ft. of interior living space. Properties can share common elements, like a water meter, as long as the overall use does not surpass the number of allowed fixtures.

What Are the Basics of the Process?

It is best to contact an attorney well versed with the CPR process on Maui, and the County Planning department regarding permitting and zoning, to understand what is allowed on their property before they decide to condo their property.

A Declaration of a Condominium Property Regime, the by-laws of the condominium organization formed up of unit owners, a condo map, and the master deed or lease, if appropriate, must all be submitted in order to CPR a property. Each unit can be sold and mortgaged independent of one another and often there are no association fees.

Read more about the process with the “So You Want To Go Condo” brochure located in the developer’s section of the Hawaii Department of Commerce and Consumer Affairs (DCCA) Real Estate Division website.