Tenant buyout in Berkeley! Need your advice

[Alex Zhang]

Hi guys, hope all is well! I am pretty new to here and I need you professional advice!!

I am running into some tenant buyout dilemma in Berkeley, CA. It’s an off-market deal that we are going to purchase a multifamily property from a wholesaler. I was told that the property is only 1of 8 units occupied, but just find almost 4 units occupied last night, a week before closing date. A few things from talking with the wholesaler needs to point out here:

1. Two tenants are in the law suit with the owner. The owner says one is in the mediation process that he will be fully responsible for taking care of that (in PSA) and another was already settled. But we’ve heard another tenant recently filed another law suit against the owner again.

2. One tenant is going to sign the agreement to move out. Not sure if it’s a buyout agreement or other settlement.

3. Last one tenant is sticking to the unit and no willing to move out at this moment, but she keeps paying rent.

So question here: 

how do you feel about potential risk? How confidence can we trust the wholesaler? Can we make tenant settled and unit vacant as closing condition? If the tenant signs the settlement/agreement but refuses to execute by the due date, any enforcement method? How long and how difficult to do that? How difficult to buyout tenant in the city of Berkeley?

Sorry I’ve put too many questions here. Thanks so much for your time and consideration!

-Alex