Memorandum of Real Estate Purchase Option Agreement
(NJ)

Summary

This template for a memorandum of real estate purchase option agreement may be used by a purchaser who wishes to record its right to purchase real property in New Jersey pursuant to certain conditions set forth in a sales contract. This template contains practical guidance, drafting notes, and optional clauses. A memorandum of the contract granting the purchaser an option to purchase real property may be recorded in lieu of the entire contract, often to avoid revealing the purchase price while putting third parties on notice of the purchaser's right to purchase real property in New Jersey. This template is suggested for use in New Jersey; however, local counsel should be engaged to ensure that all state-specific requirements are met, and the agreement and ancillary documents comply with New Jersey law in all respects. Memoranda of options to purchase real property should be recorded in the recording office of the county in which the land is located. See N.J.S. 46:26A-2(g) and 46:26A-6 for further detail. Before a memorandum of option may be recorded, it must satisfy certain requirements. It must: (1) be in English or accompanied by a translation in English (N.J.S. 46:26A-3(a)(1)), (2) be signed by the parties contracting (N.J.S. 46:26A-3(a)(2)), (3) be acknowledged or proved (N.J.S. 46:26A-3(a)(3) and N.J.S. 46:14-2.1), and (4) contain printed names beneath all signatures that appear on it (N.J.S. 46:26A-3(a)(4)). For further guidance about recording procedures in New Jersey, see Recording Procedures (NJ). For a template option contract in New Jersey, see Option Agreement (Commercial Purchase) (NJ) and 6 New Jersey Transaction Guide § 100.201. For further information on the purchase and sale of commercial real property in New Jersey, see Purchase and Sale of Commercial Real Property (NJ), Commercial Real Estate Ownership (NJ), and Commercial Real Estate Development: Legal and Other Considerations (NJ). For a full listing of key content covering purchasing and selling commercial real estate, see Purchasing and Selling Commercial Real Estate Resource Kit. See also Junior Associate Real Estate Resource Kit (Commercial Purchase and Sale).