Can Michigan condominium development rights expire automatically when a developer fails to build units on time? In Woodfield Greens Condominium Association v Soho Land Development, Inc., unpublished per curiam opinion of the Michigan Court of Appeals, issued March 16, 2026 (Docket No. 371067), the Court affirmed that undeveloped condominium units designated as “need not be built” automatically revert to general common elements by operation of law if they are not constructed within ten years of commencement of construction, and that no informal letter, email, or unrecorded statement can stop the clock. As discussed below, this decision provides critical guidance for Michigan condominium associations, developers, and purchasers of undeveloped condominium property.
The Woodfield Greens Condominium Development Rights Dispute
Woodfield Greens Condominium was created in 2005 when the initial developer recorded a master deed establishing 50 units in Oakland County. The master deed designated Units 1 through 4 as “must be built” and all remaining units, Units 5 through 50, as “need not be built.” A Notice of Commencement was recorded on August 31, 2005, marking the official start of construction.
In December 2010, Michael McGrath purchased Units 37 through 50, all of which were “need not be built.” In February 2014, McGrath’s attorney sent a letter to the property manager, Cummings Property Management, asserting that McGrath’s units were “must be built” and would remain part of the project after the 10-year deadline. The property manager never responded. No amendment to the master deed or subdivision plan was ever recorded, and McGrath’s units were never constructed.
In 2015, 10 years after construction commenced, the statutory deadline expired. The Woodfield Greens Condominium Association (the “Condominium Association”) took the position that McGrath’s units had automatically converted to general common elements by operation of law. In 2022, the Condominium Association recorded a first amendment to the master deed reflecting the nonexistence of Units 17 through 50. The Condominium Association then sued McGrath to quiet title and for a declaratory judgment that the former units no longer existed. McGrath counterclaimed seeking restitution for property taxes he had paid on the land. The trial court granted summary disposition in the Condominium Association’s favor on both the complaint and the counterclaim. McGrath appealed, and the Court of Appeals affirmed.
What Happens When “Need Not Be Built” Units Are Never Constructed?
Under the 2002 version of MCL 559.167(3), the answer is straightforward. If “need not be built” units are not constructed or properly withdrawn within 10 years after commencement of construction, the undeveloped property automatically remains part of the condominium project as general common elements and all rights to construct units cease.
The Court relied on Elizabeth Trace Condo Ass’n v American Global Enterprises, Inc, 340 Mich App 435; 986 NW2d 412 (2022), which confirmed that once the 10-year period expires without withdrawal or construction, the land becomes general common elements and all rights to construct on that land cease. The Court also confirmed that the 2016 amendments to MCL 559.167 do not apply retroactively, citing Cove Creek Condo Ass’n v Vistal Land & Home Dev, LLC, 330 Mich App 679; 950 NW2d 502 (2019).
In Woodfield Greens, there was no dispute: construction began in 2005, the deadline expired in 2015, and McGrath’s units were never built and never formally withdrawn. The reversion to general common elements was automatic.
What Is the Difference Between “Must Be Built” and “Need Not Be Built” Units?
This distinction is fundamental to Michigan condominium law, and the consequences of misunderstanding it can be severe. Under MCL 559.166(2)(j), every condominium subdivision plan must label all proposed structures as either “must be built” or “need not be built.” “Must be built” units impose a mandatory construction obligation on the developer. “Need not be built” units give the developer flexibility, they can be constructed, withdrawn, or left unbuilt, but only within the statutory timeframes. If no action is taken before the 10-year deadline, the units revert automatically.
In Woodfield Greens, the master deed and subdivision plan were unambiguous: only Units 1 through 4 were “must be built.” McGrath’s Units 37 through 50 were “need not be built.” Buying those units transferred whatever development rights existed, along with the statutory constraints already running against them.
Can a Developer Preserve Michigan Condominium Development Rights Through Informal Letters?
No. The Court of Appeals made clear that informal correspondence cannot change what is recorded in the condominium documents.
McGrath argued that his attorney’s 2014 letter to Cummings Property Management was sufficient to convert his units from “need not be built” to “must be built,” preserving his rights beyond the 10-year deadline. The Court rejected that argument, pointing to three statutory requirements. Under MCL 559.167(1), any change in a condominium project must be reflected in an amendment to the appropriate condominium document. Under MCL 559.191, no amendment to a recorded condominium document is effective until it is recorded with the register of deeds. And under MCL 559.166(3), subdivision plans must be numbered and recorded consecutively when filed with the register of deeds.
The only way to change a unit’s designation is to record a properly executed amendment to the master deed and subdivision plan. A unilateral letter to a property manager, even one that goes unanswered, accomplishes nothing.
What Risks Do Purchasers of Undeveloped Condominium Units Face?
Woodfield Greens also serves as a cautionary tale for purchasers of undeveloped condominium property. When McGrath purchased the units in 2010, the statutory deadline under MCL 559.167(3) was already running. A review of the master deed and subdivision plan would have revealed both the “need not be built” designation and the applicable statutory framework.
Instead, McGrath relied on assumptions and informal correspondence rather than obtaining a properly recorded amendment before the statutory deadline expired. Once the deadline passed in 2015, the development rights terminated automatically. The Court also affirmed dismissal of McGrath’s restitution claim seeking reimbursement for taxes paid on the undeveloped property because the Condominium Association received no benefit from those payments. The decision highlights the importance of conducting thorough due diligence before purchasing undeveloped condominium units. Purchasers should carefully review:
- the master deed;
- the condominium subdivision plan;
- recorded amendments;
- the date construction commenced; and
- whether statutory deadlines have expired or are approaching.
Key Takeaways for Michigan Condominium Associations, Developers, and Purchasers
This case is an important reminder that Michigan condominium law strictly enforces statutory deadlines and recording requirements. The decision demonstrates that development rights can be extinguished automatically by operation of law when the requirements of the Michigan Condominium Act are not satisfied.
- “Need not be built” units carry a hard statutory deadline. Under the 2002 version of MCL 559.167(3), undeveloped units that are not constructed or properly withdrawn within 10 years after commencement of construction automatically revert to general common elements by operation of law.
- Only recorded amendments can modify condominium documents. Letters, emails, internal understandings, or verbal assurances are not sufficient to preserve development rights or change unit designations. Changes to a condominium project must be reflected in properly recorded amendments to the master deed and subdivision plan.
- Michigan courts strictly enforce recorded condominium documents. As Woodfield Greens demonstrates, courts will apply the plain language of the Michigan Condominium Act and recorded condominium documents even where a developer or purchaser believed development rights still existed.
- Condominium associations should review older projects for undeveloped units. If a condominium project contains undeveloped “need not be built” units that were never constructed or formally withdrawn, those units may already have reverted to general common elements. Associations should work with experienced condominium counsel to evaluate the project’s governing documents and confirm the legal status of any undeveloped property.
- Developers must act before the statutory deadline expires. Developers and successors holding undeveloped units should evaluate whether amendments to the master deed, withdrawal of undeveloped land, or construction activity must occur before the expiration of the statutory period.
- Purchasers of undeveloped units must conduct careful due diligence. Before acquiring undeveloped condominium property, purchasers should confirm the unit designation in the recorded subdivision plan, determine the applicable statutory deadlines, and verify whether development rights remain legally valid.
Conclusion: Review Your Condominium Project Before Development Rights Expire
If your condominium project was established before the 2016 amendments to MCL 559.167 and still contains undeveloped “need not be built” units, now is the time to review the project’s governing documents and development history. As Woodfield Greens illustrates, once development rights expire by operation of law, they may not be revived through informal agreements or unrecorded understandings.
If your community association or condominium association needs guidance on undeveloped units, master deed amendments, or development rights under the Michigan Condominium Act, contact the experienced Michigan community association attorneys at Hirzel Law, PLC.
