Florida Statutes

Fla. Stat. § 718.401 (2025)

Leaseholds.

✓ 2025 Florida Statutes — current through the 2025 Regular Session

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718.401 Leaseholds.—

(1) A condominium may be created on lands held under lease or may include recreational facilities or other common elements or commonly used facilities on a leasehold if, on the date the first unit is conveyed by the developer to a bona fide purchaser, the lease has an unexpired term of at least 50 years. However, if the condominium constitutes a nonresidential condominium or commercial condominium, or a timeshare condominium created pursuant to chapter 721, the lease shall have an unexpired term of at least 30 years. If rent under the lease is payable by the association or by the unit owners, the lease shall include the following requirements:

(a) The leased land must be identified by a description that is sufficient to pass title, and the leased personal property must be identified by a general description of the items of personal property and the approximate number of each item of personal property that the developer is committing to furnish for each room or other facility. In the alternative, the personal property may be identified by a representation as to the minimum amount of expenditure that will be made to purchase the personal property for the facility. Unless the lease is of a unit, the identification of the land shall be supplemented by a survey showing the relation of the leased land to the land included in the common elements. This provision shall not prohibit adding additional land or personal property in accordance with the terms of the lease, provided there is no increase in rent or material increase in maintenance costs to the individual unit owner.

(b) The lease shall not contain a reservation of the right of possession or control of the leased property by the lessor or any person other than unit owners or the association and shall not create rights to possession or use of the leased property in any parties other than the association or unit owners of the condominium to be served by the leased property, unless the reservations and rights created are conspicuously disclosed. Any provision for use of the leased property by anyone other than unit owners of the condominium to be served by the leased property shall require the other users to pay a fair and reasonable share of the maintenance and repair obligations and other exactions due from users of the leased property.

(c) The lease shall state the minimum number of unit owners that will be required, directly or indirectly, to pay the rent under the lease and the maximum number of units that will be served by the leased property. The limitation of the number of units to be served shall not preclude enlargement of the facilities leased and an increase in their capacity, if approved by the association operating the leased property after unit owners other than the developer have assumed control of the association. The provisions of this paragraph do not apply if the lessor is the Government of the United States or this state or any political subdivision thereof or any agency of any political subdivision thereof.

(d)1. In any action by the lessor to enforce a lien for rent payable or in any action by the association or a unit owner with respect to the obligations of the lessee or the lessor under the lease, the unit owner or the association may raise any issue or interpose any defense, legal or equitable, that he or she or it may have with respect to the lessor’s obligations under the lease. If the unit owner or the association initiates any action or interposes any defense other than payment of rent under the lease, the unit owner or the association shall, upon service of process upon the lessor, pay into the registry of the court any allegedly accrued rent and the rent which accrues during the pendency of the proceeding, when due. If the unit owner or the association fails to pay the rent into the registry of the court, the failure constitutes an absolute waiver of the unit owner’s or association’s defenses other than payment, and the lessor is entitled to default. The unit owner or the association shall notify the lessor of any deposits. When the unit owner or the association has deposited the required funds into the registry of the court, the lessor may apply to the court for disbursement of all or part of the funds shown to be necessary for the payment of taxes, mortgage payments, maintenance and operating expenses, and other necessary expenses incident to maintaining and equipping the leased facilities or necessary for the payment of other expenses arising out of personal hardship resulting from the loss of rental income from the leased facilities. The court, after an evidentiary hearing, may award all or part of the funds on deposit to the lessor for such purpose. The court shall require the lessor to post bond or other security, as a condition to the release of funds from the registry, when the value of the leased land and improvements, apart from the lease itself, is inadequate to fully secure the sum of existing encumbrances on the leased property and the amounts released from the court registry.

2. When the association or unit owners have deposited funds into the registry of the court pursuant to this subsection and the unit owners and association have otherwise complied with their obligations under the lease or agreement, other than paying rent into the registry of the court rather than to the lessor, the lessor cannot hold the association or unit owners in default on their rental payments nor may the lessor file liens or initiate foreclosure proceedings against unit owners. If the lessor, in violation of this subsection, attempts such liens or foreclosures, then the lessor may be liable for damages plus attorney’s fees and costs that the association or unit owners incurred in satisfying those liens or foreclosures.

3. Nothing in this paragraph affects litigation commenced prior to October 1, 1979.

(e) If the lease is of recreational facilities or other commonly used facilities that are not completed, rent shall not commence until some of the facilities are completed. Until all of the facilities leased are completed, rent shall be prorated and paid only for the completed facilities in the proportion that the value of the completed facilities bears to the estimated value, when completed, of all of the facilities that are leased. The facilities shall be complete when they have been constructed, finished, and equipped and are available for use.

(f)1. A lease of recreational or other commonly used facilities entered into by the association or unit owners prior to the time when the control of the association is turned over to unit owners other than the developer shall grant to the lessee an option to purchase the leased property, payable in cash, on any anniversary date of the beginning of the lease term after the 10th anniversary, at a price then determined by agreement. If there is no agreement as to the price, then the price shall be determined by arbitration conducted pursuant to chapter 44 or chapter 682. This paragraph shall be applied to contracts entered into on, before, or after January 1, 1977, regardless of the duration of the lease.

2. If the lessor wishes to sell his or her interest and has received a bona fide offer to purchase it, the lessor shall send the association and each unit owner a copy of the executed offer. For 90 days following receipt of the offer by the association or unit owners, the association or unit owners have the option to purchase the interest on the terms and conditions in the offer. The option shall be exercised, if at all, by notice in writing given to the lessor within the 90-day period. If the association or unit owners do not exercise the option, the lessor shall have the right, for a period of 60 days after the 90-day period has expired, to complete the transaction described in the offer to purchase. If for any reason such transaction is not concluded within the 60 days, the offer shall have been abandoned, and the provisions of this subsection shall be reimposed.

3. The option shall be exercised upon approval by owners of two-thirds of the units served by the leased property.

4. The provisions of this paragraph do not apply to a nonresidential condominium and do not apply if the lessor is the Government of the United States or this state or any political subdivision thereof or, in the case of an underlying land lease, a person or entity which is not the developer or directly or indirectly owned or controlled by the developer and did not obtain, directly or indirectly, ownership of the leased property from the developer.

(g) The lease or a subordination agreement executed by the lessor must provide either:

1. That any lien which encumbers a unit for rent or other moneys or exactions payable is subordinate to any mortgage held by an institutional lender, or

2. That, upon the foreclosure of any mortgage held by an institutional lender or upon delivery of a deed in lieu of foreclosure, the lien for the unit owner’s share of the rent or other exactions shall not be extinguished but shall be foreclosed and unenforceable against the mortgagee with respect to that unit’s share of the rent and other exactions which mature or become due and payable on or before the date of the final judgment of foreclosure, in the event of foreclosure, or on or before the date of delivery of the deed in lieu of foreclosure. The lien may, however, automatically and by operation of the lease or other instrument, reattach to the unit and secure the payment of the unit’s proportionate share of the rent or other exactions coming due subsequent to the date of final decree of foreclosure or the date of delivery of the deed in lieu of foreclosure.

The provisions of this paragraph do not apply if the lessor is the Government of the United States or this state or any political subdivision thereof or any agency of any political subdivision thereof.

(2) Subsection (1) does not apply to residential cooperatives created prior to January 1, 1977, which are converted to condominium ownership by the cooperative unit owners or their association after control of the association has been transferred to the unit owners if, following the conversion, the unit owners will be the same persons who were unit owners of the cooperative and no units are offered for sale or lease to the public as part of the plan of conversion.

(3) If rent under the lease is a fixed amount for the full duration of the lease, and the rent thereunder is payable by a person or persons other than the association or the unit owners, the division director has the discretion to accept alternative assurances which are sufficient to secure the payment of rent, including, but not limited to, annuities with an insurance company authorized to do business in this state, the beneficiary of which shall be the association, or cash deposits in trust, the beneficiary of which shall be the association, which deposit shall be in an amount sufficient to generate interest sufficient to meet lease payments as they occur. If alternative assurances are accepted by the division director, the following provisions are applicable:

(a) Disclosures contemplated by paragraph (1)(b), if not contained within the lease, may be made by the developer.

(b) Disclosures as to the minimum number of unit owners that will be required, directly or indirectly, to pay the rent under the lease and the maximum number of units that will be served by the leased property, if not contained in the lease, may be stated by the developer.

(d) The provisions of paragraph (1)(g) do not apply.

History.—s. 1, ch. 76-222; s. 1, ch. 77-174; ss. 6, 13, ch. 78-340; s. 1, ch. 79-166; s. 13, ch. 79-314; ss. 4, 7, ch. 80-323; s. 5, ch. 81-185; s. 13, ch. 84-368; s. 46, ch. 85-62; s. 6, ch. 88-148; s. 1, ch. 88-225; s. 17, ch. 90-151; s. 15, ch. 91-103; s. 1, ch. 91-236; s. 5, ch. 91-426; s. 865, ch. 97-102.

Notes of Decisions

Cited in 58 cases, 1978–2015 · leading case: Sans Souci v. Div. of Florida Land, Etc., 421 So. 2d 623 (Fla. 1st DCA 1982).

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Sans Souci v. Div. of Florida Land, Etc., 421 So. 2d 623 (Fla. 1st DCA 1982). · cites it 26× “565, when read together and harmonized with Section 718.401, Florida Statutes (1981), providing that condominiums may be created on lands held under lease for no less than 50 years, evinces the logical deduction that the legislature wisely perceived that problems of precisely…”

Pomponio v. Claridge of Pompano Condo., 378 So. 2d 774 (Fla. 1979). · cites it 12× “The present cause is before us to determine the constitutionality of section 718.401(4), Florida Statutes (1977), which provides for the deposit of rents into the registry of the court during litigation involving obligations under a condominium lease.”

Sans Souci v. Div. Of Fla. Land Sales & Condos., 448 So. 2d 1116 (Fla. 1st DCA 1984). · cites it 17× “The issue for our review is whether there was sufficient documentary evidence presented to the Division of Florida Land Sales and Condominiums for the division to find that an assignment of a master sublease effected a novation, thereby making section 718.401(8), Florida…”

Steinhardt v. Rudolph, 422 So. 2d 884 (Fla. 3d DCA 1982). · cites it 8× “" § 718.401(8)(a), Fla. Stat. (1981). This clause has by statute been prospectively declared "void" as against Florida public policy and may no longer be included or enforced in any lease which, unlike here, was entered into subsequent to the effective date of the statute.”

Angora Enter., Inc. v. Cole, 439 So. 2d 832 (Fla. 1983). · cites it 10× “NOTES [1] The two sections under discussion are as follows: § 718.401, Fla. Stat. (1977) (4)(a) In any action by the lessor to enforce a lien for rent payable or in any action by a unit owner with respect to the obligations of the lessee or the lessor under the lease, the unit…”

Wilderness Country Club v. Groves, 458 So. 2d 769 (Fla. 2d DCA 1984). · cites it 11× “The declaration was signed by the developer and the condominium association, the same two parties who signed the lease. The lease was attached to and made a part of the declaration and the lease referred back to the declaration.”

Ass'n of Golden Glades Condo. Club, Inc. v. Sec. MGMT. CORP., 557 So. 2d 1350 (Fla. 1990). · cites it 14× “Section 718.401, Florida Statutes (1985), provided, in pertinent part: (8)(a) It is declared that the public policy of this state prohibits the inclusion or enforcement of escalation clauses in land leases or other leases or agreements for recreational facilities, land, or other…”

Cove Club Investors, Ltd. v. Sandalfoot South One, Inc., 438 So. 2d 354 (Fla. 1983). · cites it 11× “That decision reversed the trial court's order dismissing respondents' complaint and held that the escalation provision in a recreational agreement attached to a declaration of condominium was governed by section 718.401(8), Florida Statutes (1979), and therefore was…”

Fairways Royale Ass'n, Inc. v. Hasam Realty Corp., 428 So. 2d 288 (Fla. 4th DCA 1983). · cites it 8× “Hasam instituted a suit to collect the rent, and Fairways paid the disputed rent to the Court Registry pursuant to section 718.401(4), Florida Statutes (1979).”

Hovnanian Fla., Inc. v. Div. Of Fla. Land Sales, 401 So. 2d 851 (Fla. 1st DCA 1981). · cites it 12× “Contending that the escalation clause violated § 718.401(8), Florida Statutes (1979), the Division of Florida Land Sales and Condominiums (the "Division") ordered appellant, the developer of the condominium and original lessor of the recreation area, to show cause why a cease…”

Lake Tippecanoe Owners v. Nat. Lake Develop., 390 So. 2d 185 (Fla. 2d DCA 1980). · cites it 12× “Lake Tippecanoe Owners Association appeals from paragraph one of the trial court's order of March 20, 1980, which requires the Association to make certain payments pursuant to section 718.401(4), Florida Statutes (1979) [1] and from a subsequent order compelling compliance with…”

Century Vill., Inc. v. WELLINGTON, ETC., 361 So. 2d 128 (Fla. 1978). · cites it 3× “[2] Section 718.401(4), Florida Statutes (Supp.”

Show all 58 citing cases →

— 718.401(1) — 1 case

Sinatra v. Bussel, 119 So. 3d 473 (Fla. 2d DCA 2013).

— 718.401(1)(d) — 1 case

Florida Disc. Prop. Inc. v. Windermere Condo. Inc., 763 So. 2d 1084 (Fla. 4th DCA 1999).

— 718.401(1)(f) — 2 cases

Florida Disc. Prop., Inc. v. Windermere Condo., Inc., 786 So. 2d 1271 (Fla. 4th DCA 2001).

Schulberg v. Schulberg, 883 So. 2d 352 (Fla. 3d DCA 2004).

— 718.401(4) — 22 cases

Pomponio v. Claridge of Pompano Condo., 378 So. 2d 774 (Fla. 1979). “The present cause is before us to determine the constitutionality of section 718.401(4), Florida Statutes (1977), which provides for the deposit of rents into the registry of the court during litigation involving obligations under a condominium lease.”

Fairways Royale Ass'n, Inc. v. Hasam Realty Corp., 428 So. 2d 288 (Fla. 4th DCA 1983). “Hasam instituted a suit to collect the rent, and Fairways paid the disputed rent to the Court Registry pursuant to section 718.401(4), Florida Statutes (1979).”

Angora Enter., Inc. v. Cole, 439 So. 2d 832 (Fla. 1983). “NOTES [1] The two sections under discussion are as follows: § 718.401, Fla. Stat. (1977) (4)(a) In any action by the lessor to enforce a lien for rent payable or in any action by a unit owner with respect to the obligations of the lessee or the lessor under the lease, the unit…”

Lake Tippecanoe Owners v. Nat. Lake Develop., 390 So. 2d 185 (Fla. 2d DCA 1980). “Lake Tippecanoe Owners Association appeals from paragraph one of the trial court's order of March 20, 1980, which requires the Association to make certain payments pursuant to section 718.401(4), Florida Statutes (1979) [1] and from a subsequent order compelling compliance with…”

Century Vill., Inc. v. WELLINGTON, ETC., 361 So. 2d 128 (Fla. 1978). “[2] Section 718.401(4), Florida Statutes (Supp.”

— 718.401(4)(1) — 1 case

MLH Prop. Managers, Inc. v. Cox, 613 So. 2d 1358 (Fla. 4th DCA 1993).

— 718.401(4)(a) — 2 cases

Goldberger v. Regency Highland Condo., 383 So. 2d 1173 (Fla. 4th DCA 1980).

Cenvill Investors, Inc. v. Condo. Owners Org. of Century Vill. East, Inc., 556 So. 2d 1197 (Fla. 4th DCA 1990).

— 718.401(4)(i) — 1 case

Cenvill Investors, Inc. v. Condo. Owners Org. of Century Vill. East, Inc., 556 So. 2d 1197 (Fla. 4th DCA 1990).

— 718.401(6)(C) — 1 case

Waterford Point Condo. Apartmens, Inc. v. Fass, 402 So. 2d 1327 (Fla. 4th DCA 1981).

— 718.401(8) — 17 cases

Sans Souci v. Div. of Florida Land, Etc., 421 So. 2d 623 (Fla. 1st DCA 1982). “565, when read together and harmonized with Section 718.401, Florida Statutes (1981), providing that condominiums may be created on lands held under lease for no less than 50 years, evinces the logical deduction that the legislature wisely perceived that problems of precisely…”

Sans Souci v. Div. Of Fla. Land Sales & Condos., 448 So. 2d 1116 (Fla. 1st DCA 1984). “The issue for our review is whether there was sufficient documentary evidence presented to the Division of Florida Land Sales and Condominiums for the division to find that an assignment of a master sublease effected a novation, thereby making section 718.401(8), Florida…”

Cove Club Investors, Ltd. v. Sandalfoot South One, Inc., 438 So. 2d 354 (Fla. 1983). “That decision reversed the trial court's order dismissing respondents' complaint and held that the escalation provision in a recreational agreement attached to a declaration of condominium was governed by section 718.401(8), Florida Statutes (1979), and therefore was…”

Hovnanian Fla., Inc. v. Div. Of Fla. Land Sales, 401 So. 2d 851 (Fla. 1st DCA 1981). “Contending that the escalation clause violated § 718.401(8), Florida Statutes (1979), the Division of Florida Land Sales and Condominiums (the "Division") ordered appellant, the developer of the condominium and original lessor of the recreation area, to show cause why a cease…”

Ass'n of Golden Glades Condo. Club, Inc. v. Sec. MGMT. CORP., 557 So. 2d 1350 (Fla. 1990). “Section 718.401, Florida Statutes (1985), provided, in pertinent part: (8)(a) It is declared that the public policy of this state prohibits the inclusion or enforcement of escalation clauses in land leases or other leases or agreements for recreational facilities, land, or other…”

— 718.401(8)(a) — 17 cases

Steinhardt v. Rudolph, 422 So. 2d 884 (Fla. 3d DCA 1982). “" § 718.401(8)(a), Fla. Stat. (1981). This clause has by statute been prospectively declared "void" as against Florida public policy and may no longer be included or enforced in any lease which, unlike here, was entered into subsequent to the effective date of the statute.”

Wilderness Country Club v. Groves, 458 So. 2d 769 (Fla. 2d DCA 1984). “The declaration was signed by the developer and the condominium association, the same two parties who signed the lease. The lease was attached to and made a part of the declaration and the lease referred back to the declaration.”

Sky Lake Gardens Rec., Inc. v. Sky Lake Gardens Nos. 1, 3, & 4, Inc., 574 So. 2d 1135 (Fla. 3d DCA 1991).

— 718.401(l)(d) — 2 cases

Doral Mobile Home Villas, Inc. v. Doral Home Owners, Inc., 661 So. 2d 24 (Fla. 2d DCA 1994).

Florida Disc. Props., Inc. v. Windermere Condo., Inc., 763 So. 2d 1085 (Fla. 4th DCA 2000).

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