This office lease provision states that at the end of the fifth (5th) year of the lease, the tenant shall have an option to purchase the building in which the premises is located at fair market value.
The Virginia Provision Setting Out a Purchase Option is a legal clause commonly included in real estate contracts, particularly for lease agreements. This provision outlines the terms and conditions under which a tenant has the opportunity to purchase the property they are renting. It grants the tenant the right, but not the obligation, to buy the property at a specified price within a specific timeframe. In Virginia, there are different types of provisions setting out a purchase option, each serving various purposes and addressing specific situations. These may include: 1. Fixed Price Purchase Option: A fixed price purchase option sets a predetermined price at which the tenant can purchase the property. This price remains unchanged throughout the specified option period. 2. Adjustable Purchase Option: An adjustable purchase option allows for a change in the purchase price within the option period based on predetermined factors. These factors can include the property's appraised value or prevailing market conditions. 3. Lease-Purchase Agreement: This agreement combines both a lease and a purchase option. It allows a tenant to rent the property for a specific period while securing the right to purchase it at a later date. A portion of the tenant's rent payments may be credited towards the purchase price. 4. Right of First Refusal: A right of first refusal provision grants the tenant the first opportunity to purchase the property if the landlord decides to sell. It ensures that the landlord cannot sell the property to another party without first offering it to the tenant. 5. Contingent Purchase Option: In certain cases, a purchase option may be contingent upon specific events or conditions, such as obtaining financing or completing necessary repairs. This type of provision sets out the contingencies that must be fulfilled for the purchase option to be exercised. It is essential to consult with a qualified real estate attorney to understand the specific provisions applicable to a Virginia purchase option, as they can vary case-by-case and depend on local laws and regulations.
