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Buying a Gas Station or Car Wash Why You Need Landlord Consent?

Date: 06/26/2010 | Category: Business Transactions | No comments

Why You Must Get Landlord Consent When Buying a Gas Station or Car Wash

Over the past year – when representing purchasers of sag stations and car washes – there appears to be an increased trend where the prospective seller insists that landlord consent is not required.  That is the seller asserts that the existing lease agreement permits the seller to transfer and assign the lease for the business premises to any prospective purchaser without further landlord consent.  If you are purchasing a New York or New Jersey gas station or car wash and you are faced with a seller who refuses to provide you with "written consent and acknowledgments by the landlord" (also known as a landlords estoppel acknowledgment) then you should walk away from the transaction.  No matter what the lease says you must insist on obtaining an estoppel acknowledgment from the landlord‚ here's why:

  • You need to ensure that the lease is actually valid and that there are no outstanding defaults.  Even if the seller were permitted to unilaterally assign the lease agreement‚ you still need the landlords acknowledgment to ensure that the lease is actually valid and that there are no existing defaults.  What good is an assigned lease if you are inheriting the existing seller's/tenants defaults and future litigation?
  • In many cases‚ New York and New Jersey car wash and gas station leases are poorly drafted and language respecting assignments are ambiguous.  So why risk ambiguity and potential litigation?  An estoppel acknowledgment signed by the landlord will ensure (if properly drafted) that you accurately understand your rights‚ obligations and standing as a new tenant.

Your lease agreement will serve as a primary and critical asset for your car was or ghas station‚ so make sure you get it right.  Avoid short-cuts and make no assumptions.


Find out about the steps to take and mistakes to avoid when buying a New York or New Jersey gas station or car wash‚ order a complimentary copy of Charles N. Internicola's book: "An Entrepreneurs Guide to Buying a Business".

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