Honoring Rental Contracts as Part of Vacation Home Purchase
Peter Covo, Partner
A loyal client of the firm had turned to WCN’s Real Estate practice many times over the years as they sold and purchased residential properties. In the spring, our client found a vacation home for sale on Nantucket Island. The seller, who also owned the property next door, had rentals secured for the upcoming summer through Airbnb and VRBO and made the sale contingent on the buyer honoring these rentals.
The buyers contacted Peter Covo for guidance and legal counsel to review and negotiate the Purchase & Sale Agreement (‘P&S”) and to review the rental contracts with both Airbnb and VRBO. While seeking a vacation property to enjoy immediately, the buyers (our clients) were willing to accept the rental terms for the short-term.
Typically, Attorney Covo would advise clients to negotiate the purchase terms while cancelling rental agreements to enable ease of property transfer, but this was not an option for this transaction.
While the buyers were excited to purchase the island home, they did not want to take on the new role of managing the property while it was rented. This was not something they had experience with nor the desire to take on in the near term.
To protect the buyers, Attorney Covo reviewed the contractual agreements with Airbnb and VRBO, advising his clients as to the commitments being assumed. He negotiated the P&S and drafted a separate agreement between the buyer and seller that confirmed the seller would continue to manage the rental properties for the VRBO and Airbnb customers.
The loyal WCN clients closed on their vacation home on Nantucket and the seller achieved his goal of ensuring the rental agreements were honored for the upcoming summer. The separate agreement bound the seller to continue management of the property so that committed renters can enjoy the property for their planned summer vacations and the buyers would not have to arrange for property management services while not on island. Real Estate Attorney Peter Covo negotiated and facilitated this deal to ensure his client’s goals were achieved. At WCN, we are committed to delivering exceptional service to protect and guide our clients and Covo did just that.