Compromise on Tax Hikes Resulting from Sale of Property Early in Lease

Any time a property is sold there’s the possibility that the sale will trigger a tax assessment. And that creates the risk of a major real estate tax increase. Who pays for that increase when and if it occurs? Obviously, tenants won’t want to. They try to exclude tax increases resulting from a building sale from the taxes they must pay. While landlords often go along on this point, they may pay a hefty price to the extent it cuts the property’s price value when they eventually sell it.