BRRRR target... but it has LEASED SOLAR
Looking at a 3 cottage rental property, small units... it has leased solar.
I dont know the particulars of it yet, number of meters, lease length, type, cost...... but what are my strategies here? Has anyone dealt with this? I dont want to go into the rabbit hole of viewing getting docs, analyzing if this is a death trap.... THoughts?
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Been in the solar industry for 4 years.
Typically the sellers options with the lease are:
1) Transfer it with the sale of the property (which assumes the buyer is qualified and willing to accept the lease - qualification usually based solely on FICO score).
2) Pay off the lease (usually according to a payment schedule, which may include early termination fees).
Option #2 can be really expensive.
How old is the lease? Keep in mind, costs for solar equipment have dropped precipitously over the past 5 years. If you have to pay off a lease that is 5 years old, you could end up paying 70k for something that you could buy today for 20k (I've seen this many times).
If the property has multiple meters, and one solar system, well, things get complicated. I'll spare you the technical details, but this is a situation you'd want to avoid. Ideally the property would have one meter that all the units share, and one solar system that feeds that meter.
Lastly, leasing is increasingly less attractive to new solar customers. Keep in mind, if you assume the lease, and you go to sell the property in 10 years, you may be the one paying an exorbitant amount to get out of the lease.
https://www.greentechmedia.com/articles/read/its-o...
I'm happy to help with any further questions, either via this thread or direct message.
The first step would be to get a copy of the lease contract.