Value of Laurel Street Affordable Housing Site 2021-Map 38A-049Chapter 8 – Real Property Transactions: Dispositions 98
Real Property Dispositions
For any disposition of real property, regardless of value, you are required to declare the
property available for disposition and determine the value of the property. Also, if you
dispose of the property for less than the value determined, you must post a notice in the
Central Register explaining the reasons for your decision and disclosing the difference
between the value and the price to be received.121 If the value of the property exceeds
$35,000, you must solicit proposals to dispose of the property. The requirement for
competition is triggered by the value of the property, not the price your local jurisdiction
expects to receive for the property.
If you are leasing space, you determine the value of the disposition by calculating the
fair market value of the lease over the entire contract term. For example, if you are
leasing out a portion of a municipal building for five years with a market value of $1,000
per month, the entire contract is valued at $60,000. Therefore, it must be awarded
using an advertised solicitation process.
In assessing whether and how to dispose of surplus property, consider both current and
possible future needs. It is best to be systematic. Develop an inventory of your local
jurisdiction’s property, survey department heads and invite public comment. If you find
that your local jurisdiction might need the property in the future, be sure to structure a
lease term so that the property is available for use when needed.
Step 1: Declare property available for disposition and identify reuse restrictions
Before you can sell or lease property, regardless of its value, it must be declared
available for disposition by the individual or body with the authority to make such a
determination for your local jurisdiction. If your local jurisdiction wishes to impose any
restrictions on the use of the property, these restrictions must be specified as part of the
declaration that the property is available for disposition. For example, if you are selling
or leasing a surplus school building, you may not care how the new owner or lessee will
use the building, as long as the building use is legal and conforms to local zoning
121 Appendix B provides the website address for the online submission form for this
notice, and Appendix D provides contact information for the Secretary of the
Commonwealth.