D.C. Landlords Must Give Tenants a Chance to Buy Property
The landlord must send the TOPA notice to all tenants, advising them of their right to form a tenant organization. It must be a corporation. If there is a tenant corporation already in existence, that organization must provide the landlord (and the District) a statement of interest in purchasing within 30 days from receipt of the landlord's TOPA notice. If there is no corporation, the tenants have 45 days in which to organize and submit their statement of interest.
Once the landlord has been notified, the tenant corporation has 120 days in which to negotiate a sales contract. If there is a contract, the corporation has 120 days from the date of the contract in which to go to settlement. Again, if a lender provides a written statement that it needs more time, the landlord/owner must give the tenants up to an additional 120 days in which to close on the property.
It must be noted that if there are five or more rental units in the property, only the tenant corporation has the right to speak -- and negotiate -- on behalf of all the tenants. Tenants who do not join the tenant corporation will not be able to participate in any of the benefits which the tenant association may obtain through its negotiations.
Right of First Refusal
Regardless of the size of the building -- and even if the tenant or the tenant organization is unable or unwilling to enter into a contract with the owner -- the law provides the tenants with an absolute 15-day right of first refusal.
This means that if the tenant or the tenant corporation can match the contract from the third party, the tenants have the right to purchase. The clock does not begin to run on this until all the other time dictated by the law has expired.
There are many rules and many complex issues that cannot be covered in this short column. Whether you are a landlord or a tenant, you should seek competent legal and financial counsel before you take any steps to sell or buy.
The city's Department of Consumer and Regulatory Affairs has published forms that are easy to use and understand. They are available in Room 7238, 941 N. Capitol St. NE. These forms walk all parties through the process.
Benny L. Kass is a Washington lawyer. For a free copy of the booklet "A Guide to Settlement on Your New Home," send a self-addressed, stamped envelope to Benny L. Kass, Suite 1100, 1050 17th St. NW, Washington, D.C. 20036. Readers may also send questions to him at that address.
© 2004 The Washington Post Company