Since the 80’s and the 90’s, several thousand of owners bought leaseback property in France. The operating company states the return profit would be 4 % to 5 % per year. Sometimes the builder sells himself the real estate.
During the 2000s, the operators marketed the French Leaseback overseas and especially in the UK and Italy. It was marketed as a risk-free and high return investment.
The leaseback schemes were aimed to put enough renting properties on the touristic areas of France. The government and the big leaseback companies present it as a win-win solutions for operator, investor and the economy. The leaseback companies lobbied the MP’s int the French Parliament.
A lot of buyers thought they will be able to have a holiday home in France after 9 years (or at least 20 years).
3. The (tenant) lessee, is a company specialized in the
management of leaseback properties. However, the
operator writes the lease with bad faith. Because he
pretends to waive in advance his right to damages,
if the the lessor end the contract. (eviction
indemnity/(damages called in French : indemnité
d’éviction). According to the French law, the tenant
(lessee) cannot waive in advance and in the lease his
right to an eviction indemnity in case of non-
renewal of the commercial lease.
4.
5. He can waive this right to damages AFTER
signing the commercial lease.But in this
case, the operator is a pro of this industry.
He waives his right knowing well that this
clause has without legal ground. Even if, it
was for the lessor a substantial condition
of the contract, ie one main reason why
the buyer agreed to the leaseback.
6.
7. The tenant (operator) acted with the intention
to willfully misrepresented the content of the
lease contract.The operator of the leaseback
property falsely reassured the buyer/lessor in
the legitimate belief that his renunciation
constituted a real commitment.This behavior
is analyzed as a “wilful misrepresentation” (dol
in French), meaning a fraud when writing the
contract.
8.
9. The buyer of the French leaseback property signed a
leaseback contract with a operating company.
However only the tenant wrote the lease contract.
The waiver to an eviction indemnity could only
appear as a decisive element of the deal. Most
importantly, the buyer of the French leaseback
would (or might) not have signed the contract. If
their attention had not been attracted by this
financial interest, they might not have contracted.
10.
11. Otherwise, the tenant is claiming a statute of
limitation of 2 years to cancel the lease.
However, the statute of limitation of 2 years
begin to run, when the victim is informed. In
this case, it is the date of the registered mail
addressed to the owners by the operating
company.That’s why the wilful
misrepresentation (fraud) leads the judges to
cancel the commercial lease.
12.
13. Furthermore, the court decides
the paid rents were due for
operating the leaseback property
without a lease contract.The
cancellation of the lease means it
is like it had never existed.
14.
15. Since the 80’s and the 90’s, several thousand of
owners bought leaseback property in France.
The operating company states the return profit
would be 4 % to 5 % per year. Sometimes the
builder sells himself the real estate.During the
2000s, the operators marketed the French
Leaseback overseas and especially in the UK
and Italy. It was marketed as a risk-free and
high return investment.
16. The leaseback schemes were aimed
to put enough renting properties on
the touristic areas of France.The
government and the big leaseback
companies present it as a win-win
solutions for operator, investor and
the economy.The leaseback
companies lobbied the MP’s int the
French Parliament.A lot of buyers
thought they will be able to have a
holiday home in France after 9
years (or at least 20 years).
17.
18. The purchaser benefits
of aVAT refund,
because his deal is
funding a new build in
France.The operating
companies and/or the
construction company
doesn’t has to finance
with costly bank loans.
19.
20.
21. For More Information PleaseVisitThe Below Link
https://frenchrealestatelaw-traesch.fr
https://frenchrealestatelaw-traesch.fr/leaseback-indemnite-eviction/
