What does it mean if my rental agreement has a Right of First Refusal (ROFR)?

Last updated on July 17, 2026

Right of First Refusals (ROFR’s) originated over a century ago, before the telephone or internet and the enhanced communication they both offer. In times of little or no contact, a ROFR was a way of the Tenant saying to the Landlord, “If you receive an offer to buy your land, would you please get a hold of me and give me a chance to match it, without selling it before I even find out it is for sale.” Using the CLHbid.com platform, there is no longer a legitimate need for a ROFR. With CLHbid.com, everyone, including the Tenant, knows of the pending sale and has an equal chance to bid.

In today’s world, if your Tenant is asking for a ROFR; in reality, they are asking to buy your land for below market value. At CLHbid, we have seen land tendered with a ROFR only to not sell. Later we have sold that same land with no ROFR for 40% higher than the previous best tender with a ROFR. We know a ROFR can mean a quarter will often sell for $100,000.00 or more less than what it might sell when bidders know if they are high bidder they can get it without fear of being trumped by a party holding a ROFR.

The problem with a ROFR today is it is used for a whole different purpose than it was initially intended – Tenants now use it to create a steal (for lack of a better term). At CLHbid.com, our sole goal is to get top dollar for the Seller, and that is virtually impossible with a ROFR in place for two reasons.

Reason #1 – the Tenant uses the ROFR as a shield and tells every other farmer in the area he has a ROFR and that he is intent on buying the land. In the end, others don’t even bother going to their bank to get financing approval – they don’t take the time to bid, knowing they can never own it. Friends of the Tenant don’t bid as they don’t want to run up the price for the Tenant.

Reason #2 – for a large number of sales, the Tenant is often the most motivated Buyer. The Tenant knows the land and knows what it can produce; there is no spook in the buy for the Tenant (some Tenants may even try and spook other parties asking about the land). In the end, it begs the question of why on earth, in an open and transparent bidding process, would you tell the most motivated Buyer they don’t have to bid? A ROFR will affect the final price and, most likely, ‘significantly’. On sale day, we have witnessed the last two parties left bidding move the final price by more than 50%. If one of those last two parties is the Tenant, one can only imagine what the land might have sold for to the Tenant had the Tenant been given a free pass on bidding. It’s your land, so why sell it at a reduced value when the buyer may resell in a year or two and cash in on what was yours.