Exercising the tenant’s right of pre-emption—what is a qualifying building?
Exercising the tenant’s right of pre-emption—what is a qualifying building?

The following Property guidance note provides comprehensive and up to date legal information covering:

  • Exercising the tenant’s right of pre-emption—what is a qualifying building?

Under section 1(2) of the Landlord and Tenant Act 1987 (LTA 1987), certain long leasehold tenants of flats have a right of pre-emption if their landlord intends to dispose of its reversionary interest in premises which consist of ‘the whole or part of a building’. However, the word ‘building’ is not defined in LTA 1987. This presents a number of difficulties, eg under LTA 1987, s 5(3), under which a landlord who is proposing to dispose of more than one building in a single disposal must sever that disposal so that each building can be dealt with separately; in the absence of a definition of ‘building’, how is the landlord to know whether the disposal involves more than one (and if so, how many) buildings, and which tenants need to be served in relation to a particular building?

In 30 Upperton Gardens, the freehold reversion to a residential estate was sold at auction in breach of the pre-emption provisions in LTA 1987. The estate comprised 84 flats in four separate blocks, with separate garages, and amenity land. The tenants served a single purchase notice under LTA 1987, s 12(1) as originally enacted (now LTA 1987, s 12B(2) following the 1996 amendments) to acquire the freehold of the entire estate from the successful bidder at the auction. The South Eastern Rent Assessment Panel