Sample Right of First Refusal for Lease Purchase, Tax Credit-Financed Properties
This adaptable legal agreement offers a nonprofit organization the first right to purchase a portfolio of tax credit-financed properties after the 15-year regulatory compliance period has been satisfied. It is excerpted from the Cleveland Housing Networks manual entitled, Implementing a Lease Purchase Program Using the Low Income Housing Tax Credit (revised January 2004). The document reflected to the financial transaction between the Cleveland Housing Network and the limited partnership affiliated with it, which owns and maintains a particular portfolio of tax credit-financed properties during the 15-year tax credit compliance period. In order for the nonprofit to sell these properties to individual lease purchase buyers (as it does with its widely acclaimed Lease Purchase Program), it must first acquire title to these properties from the limited partnership.
This legal document sets forth a period of 45 days during which the properties may be purchased at a price equal to the sum of all outstanding debt, taxes and fees related to the transaction. Community-based organizations can adapt this excerpt in similar programs or as part of creating a similar lease purchase program.