A tenant buyout is a voluntary cash-for-keys agreement where a tenant vacates in exchange for payment. In LA, RSO buildings must follow LAHD Buyout Notification Program rules.
Buyouts let landlords achieve specific vacancy without invoking no-fault eviction grounds (with their relocation fees and Ellis Act restrictions). Requires LAHD Disclosure Notice before negotiation, signed written agreement with required provisions, 30-day tenant rescission window, and 60-day filing with LAHD.
LA multifamily buyouts typically run $20,000–$150,000+ per tenant depending on tenure, unit profile, and motivation. For pre-listing vacancy strategies on RSO buildings, buyouts are usually the cleanest tool — voluntary, controllable timing, avoids Ellis re-rental restrictions.
From the Sterman LA Multifamily Glossary — defined the way a broker with $1.41 billion across 254 closed transactions actually uses these terms.
Michael Sterman, Senior Managing Director Investments, Marcus & Millichap.
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