The complexity of Manhattan townhouse transactions goes well beyond typical residential deals, involving everything from 150-year-old party wall agreements to the timing of cryptocurrency liquidation, according to Steven Tanen, an associate attorney at Starr Associates LLP who handles high-end residential acquisitions.
Tanen recently managed a $10 million Brooklyn townhouse sale that highlighted the challenges in today’s luxury market. The all-cash transaction involved a crypto buyer whose wealth required careful coordination with volatile digital currency markets.
“There were some timing aspects as to liquidation of his cryptocurrency, making sure that with the volatile market, the timing makes a lot of difference there,” said Tanen, whose firm represents major developers including JDS, Macklowe, and Taconic.
The legal complexities of townhouse purchases often catch even experienced buyers off guard. Unlike condominiums or co-ops, townhouses come with historical documents that can affect renovation plans and property rights.
“A lot of these walls are shared between other houses,” Tanen explained. “So you want to make sure that, if this buyer is going in there to do some renovations, what he would have to do for the neighbor to be able to get those renovations done.”
In recent transactions, Tanen has encountered party wall agreements dating back to 1871, requiring title companies to transcribe documents that are barely readable. These agreements can dictate everything from structural modifications to floor additions, creating potential complications that buyers must understand before closing.
“We’re not negotiating the party wall agreements, because my most recent one was from 1871, but you have to tell them what is in it and what you could be up against,” he said.
The inspection and title review process for townhouses differs from other property types. Without building financials to review or board packages to prepare, attorneys focus on historical documents and structural assessments that can reveal hidden restrictions or obligations.
For crypto buyers, Tanen’s firm has developed specialized escrow services to manage the volatility of digital assets. As licensed escrow agents, they can hold liquidated cryptocurrency proceeds to help ensure purchase funds remain stable throughout the transaction period.
“If our client is concerned about how much his money is going to change in the next two weeks and needs to make sure that he has money for a deposit, we can hold it for them,” Tanen explained. “We can fund the deposit for you to the seller’s attorney.”
This service is particularly valuable when sellers demand rapid contract execution. In the recent Brooklyn deal, the seller required contract signing within five days, an unusually tight timeline for high-end townhouse purchases.
“We need to sign contract in five days, which is not very common with high-end townhouse purchases,” Tanen noted. “So we get your inspection done, we try to move as quickly as possible.”
The structuring of these deals often involves multiple layers of legal entities designed to protect buyer identity. Tanen has served as the named buyer in transactions where the actual purchaser remains completely anonymous through carefully constructed LLC arrangements.
Market dynamics have shifted, with New York transitioning from a seller’s market toward more buyer-favorable conditions. This change has created opportunities for decisive buyers willing to move quickly, but also increased the importance of sophisticated legal counsel capable of managing compressed timelines while protecting client interests.
For attorneys handling these transactions, success depends on understanding both the historical complexity of century-old properties and the modern challenges of new wealth sources. This creates a unique practice area that bridges traditional real estate law with contemporary financial innovation.
