Cal. Code Regs. Tit. 21, § 1489 - Priority 9: Surplus Nonresidential Properties

(a) Offer. When Priority 9 is specified as the next priority by §§ 1477.1, 1477.2, or 1477.3, as applicable, then all Surplus Nonresidential Properties not already sold shall be offered to current Tenants at Fair Market Value.

(b) Eligibility Criteria to Receive a Sales Contract. To be eligible to receive a sales contract to purchase a Surplus Nonresidential Property, current Tenants shall:

(1) be current on all rent obligations and paid in full; and

(2) be in full compliance with the terms and conditions of the lease or rental agreement; and

(3) be a current Tenant of the Surplus Nonresidential Property.

(c) Determining Eligibility to Receive a Sales Contract. The Department will determine if a current Tenant is eligible to receive a sales contract to purchase a Surplus Nonresidential Property.

(d) Tenants with Equal Priority. If more than one current Tenant is eligible to receive a sales contract to purchase a Surplus Nonresidential Property, then priority is given to the Tenant who makes the highest price bid on the property.

(e) Sales Contract. The Department will send a sales contract to the Tenant who has priority to purchase the property. The sales contract shall be executed and returned to the Department within 30 calendar days of the date the Department sends the contract.

(f) Escrow. Upon execution of the contract, a Tenant has 120 calendar days to close escrow. Upon written request, the Department will provide an additional 30 calendar days to close escrow.

(g) Pending Rent Obligations. A Tenant shall be current on all rent obligations to the Department in order to close escrow.

(h) Nonperformance. If a Tenant fails to timely execute a sales contract in the time provided in (e) or fails to close escrow in the time provided in (f), then:

(1) The sales contract is void.

(2) The Department will award the property to the next eligible Tenant pursuant to (d) and send a sales contract pursuant to (e).

(3) If there is no other eligible Tenant, then the property will proceed to Priority 8, except without the requirement in Section 1488(b)(2).

(i) No Warranty. Any Surplus Nonresidential Properties is sold "as-is" and without warranty.

Notes

Cal. Code Regs. Tit. 21, § 1489

1. New section filed 7-26-2016; operative 7-26-2016 pursuant to Government Code section 11343.4(b)(3) (Register 2016, No. 31).
2. Repealer and new section filed 12-13-2021 as an emergency; operative 12-13-2021 (Register 2021, No. 51). Pursuant to Government Code Section 54237.10, this is a statutorily deemed emergency and the emergency language remains in effect until 12-14-2023. A Certificate of Compliance must be transmitted to OAL by 12-13-2023 or emergency language will be repealed by operation of law on the following day.
3. Amendment of subsection (a) and NOTE filed 4-7-2022 as an emergency; operative 4-7-2022 (Register 2022, No. 14). Pursuant to Government Code section 54239.4(f), this is a statutorily deemed emergency and the emergency language remains in effect until 4-7-2024. A Certificate of Compliance must be transmitted to OAL by 4-7-2024 or emergency language will be repealed by operation of law on the following day.
4. Pursuant to Government Code section 54239.5(e)(3), as added by Senate Bill 959 (Stats. 2022, Ch. 668), a Certificate of Compliance must be transmitted to OAL by 9-30-2024 or language of the emergency order of 12-13-2021 (Register 2021, No. 51) and emergency order of 4-7-2022 (Register 2022, No. 14) will be repealed by operation of law on the following day (Register 2023, No. 27).

Note: Authority cited: Sections 54237, 54237.10 and 54239.4, Government Code. Reference: Sections 54236, 54237 and 54239.4, Government Code; and Article XVI section 6, California Constitution.

1. New section filed 7-26-2016; operative 7/26/2016 pursuant to Government Code section 11343.4(b)(3) (Register 2016, No. 31).
2. Repealer and new section filed 12-13-2021 as an emergency; operative 12/13/2021 (Register 2021, No. 51). Pursuant to Government Code Section 54237.10, this is a statutorily deemed emergency and the emergency language remains in effect until 12-14-2023. A Certificate of Compliance must be transmitted to OAL by 12-13-2023 or emergency language will be repealed by operation of law on the following day.
3. Amendment of subsection (a) and Note filed 4-7-2022 as an emergency; operative 4/7/2022 (Register 2022, No. 14). Pursuant to Government Code section 54239.4(f), this is a statutorily deemed emergency and the emergency language remains in effect until 4-7-2024. A Certificate of Compliance must be transmitted to OAL by 4-7-2024 or emergency language will be repealed by operation of law on the following day.