Tenant’s Right Of First Refusal

Following the publication of a 1985 government report into home ownership, the Landlord & Tenant Act 1987 (LTA) was rapidly enacted to give leasehold residential tenants a right of first refusal when their landlord sold the freehold. In 1996 this badly drafted "obscure" piece of legislation was overhauled. This article considers the implications for pharmacy owners whose commercial premises are located within the same building as residential flats.

This is particularly important if you are the building owner intending to sell.

The Right of First Refusal

Where the LTA applies, a landlord is prohibited from disposing of a freehold, unless it is first offered to the residential tenants of building. Penalties of up to £5,000 may be imposed for non-compliance.