Under the Landlord and Tenant Act 1987, when a landlord proposes to sell the freehold or an interest in the building, qualifying leaseholders often have the Right of First Refusal (ROFR) — a chance to buy on the same terms before a sale to a third party.
How ROFR works
- The landlord serves an offer notice on tenants
- Leaseholders typically respond through a nominee purchaser (often a company formed by residents)
- Strict time limits apply at each stage — missing a deadline can mean losing the right for that sale
- If accepted, completion follows the terms in the notice
When ROFR may not apply
- Sales to associated companies
- Some single-flat buildings
- Certain public sector landlords
- Other technical exemptions in the Act
Important:
The rules are technical. If you receive an offer notice, seek professional advice quickly — deadlines are short.
If notices are not served properly
If the landlord sells without following the procedure, leaseholders may have a claim against the new owner or original landlord — including, in some cases, acquiring the interest on the same terms as the third-party purchaser.
ROFR is reactive (triggered by the landlord's decision to sell). It is distinct from collective enfranchisement, where leaseholders initiate a purchase.