If I sell commercial property that I own, will new owner be bound to the lease I have with a current tenant?

Get Legal Help Today

 Secured with SHA-256 Encryption

If I sell commercial property that I own, will new owner be bound to the lease I have with a current tenant?

I have commercial property with an auto dealership located on the property. I own both. I currently have a tenant in the dealership, but have another individual wanting to purchase the property. Will the new property owner be obligated to the lease I currently have with the tenant?

Asked on December 19, 2011 under Real Estate Law, Alabama

Answers:

FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

Good question. If any real property is being sold with a term lease (as opposed to a month-to-month lease) the new owner of the purchased property will acquire the property subject to a tenant in place.

This is why it is always best for the owner of the property being sold to disclose the tenancy in place and provide an estoppel certificate to the buyer filled out by the seller and the tenant who is occupying the property being purchased. That way there is no misunderstandings as to any lease issues.

In many situations, the seller attempts to buy out the tenant as part of the transaction where the property is sold to a third party.


IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although AttorneyPages.com has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

Get Legal Help Today

Find the right lawyer for your legal issue.

 Secured with SHA-256 Encryption