Howard County, MD, Expands ROFR Requirements for Multifamily Sales
The Howard County, Maryland, Council passed Bill 13-2020—the Affordable Housing Retention Act—last week. This legislation provides the County and the Howard County Housing Commission with the right to purchase rental housing on the same terms and conditions as offered for a private sale.
Previously, the Howard County Right of First Refusal (ROFR) law merely required that the County be notified of a ROFR sale, but neither the County nor the Howard County Housing Commission were afforded a right of first refusal. When this law becomes effective on September 6, 2020, the new purchase rights of the County and the Howard County Housing Commission will be applicable to all multifamily sales of five or more units.
This new law is very similar to the ROFR laws in Maryland’s Montgomery County and Prince George's County that have existed for many years.
Note that the legislation includes a provision allowing a buyer to forgo the right-to-purchase process for the County and Housing Commission if the buyer agrees to maintain existing affordable units or create at least 20 percent affordable units at the property. This legislation also outlines specific reporting requirements for the County and the Housing Commission to provide additional oversight of the County’s affordable housing portfolio.
Owners and investors planning to sell or purchase multifamily properties in Howard County should assess how the Affordable Housing Retention Act may affect them and plan accordingly for the September change.
Our Real Estate Development and Transactions Group can assist clients with questions about the new law.
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