Texas SB 17 · Leases
SB 17 treats a twelve-month lease as an acquisition.
SB 17 reaches leasehold interests of one year or longer, and that one-year line was set in conference: every published version before the enrolled text exempted leases shorter than one hundred years. A lease made in violation is not void by operation of law. Section 5.257 lets a court-appointed receiver terminate one, which is a different thing and a slower one. Landlords and property managers are inside this statute whether or not a title company is involved.
What the statute says
Section 5.253 prohibits purchasing or otherwise acquiring an interest in real property, and Section 5.252(3) excepts a leasehold interest in land or improvements constructed on a leasehold only where the duration of the interest is less than one year. A leasehold of one year or more is not excepted. Read it in the enrolled text of S.B. 17.
What happens to a lease made in violation
A court can order it terminated. It does not end by itself. The word void appears once in the whole bill, at Section 5.255(e), and it appears there in a denial: a purchase or acquisition in violation of Section 5.253 is not void because of the violation, except for an acquisition of a leasehold interest. The section withholds that protection from a leasehold. It does not void one.
The remedy the subchapter does name is Section 5.257(a)(1)(C)(i). After the Attorney General brings an action under Section 5.255 and a court finds a violation, the court appoints a receiver to divest the interest through sale, termination of a leasehold, or other disposition. Termination sits at the end of that road, in a receiver's hands. Nobody at the closing table is in a position to declare a lease void, and a landlord who stops performing on that theory is the one taking the risk.
How the bill arrived at that
Neither piece was in the bill as filed. The introduced version carried no leasehold carve-out from the anti-voidness clause at all. The engrossed version added one, tied by cross-reference to the leasehold exception. The receiver's power to end a lease appears first in the House committee substitute, and the House analysis says so in its own comparison of the two: the substitute added divesting an interest through sale, termination of a leasehold, or other disposition to the receiver's role, and the engrossed version did not include it. The carve-out and the termination power were built to work together. Read the House committee report analysis.
Why the one-year line is newer than the bill
Every published version of SB 17 before the enrolled text set the leasehold exception at a duration of less than one hundred years, which left essentially every commercial lease in Texas outside the statute. The introduced bill, the Senate committee report, the engrossed bill and the House committee substitute all say one hundred years. The enrolled text says one year. The change was made in conference, and both chambers adopted the Conference Committee Report, the House on May 29, 2025 and the Senate on May 30. If a summary you are reading treats leases as mostly outside this statute, check which version of the bill it was written from.
What the proposed rules would add
Proposed Section 67.2(5) defines an interest in real property to include a series of licenses, leases, or other arrangements that, in substance, create a leasehold of one year or longer, even if structured as successive short-term agreements. Proposed Section 67.2(6)(B) carries the same language into the definition of purchase or otherwise acquire. Read from the Texas Register on September 10, 2026. Proposed, not adopted.
Who this touches
Commercial landlords leasing to entities. Property managers with corporate tenants. Brokers on lease deals with foreign-national principals. Ground leases for energy and telecom.
What a record shows for a lease
The tenant's answers, the control-person tree if the tenant is an entity, an OFAC screen of every name, the rule result with the lease term recorded, and the hash. The record shows the term you were told and the date you asked. It does not tell you the lease is enforceable. Counsel decides that.
See what the record looks like.
Both samples use fictional names and a fictional hash. Neither can be verified and neither is a record. The second one shows the hits and dispositions table that a file with no potential matches leaves empty.