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A set dollar amount provided by the Landlord under a lease to be used by the Tenant for
a specific purpose. Examples include allowances for moving expenses ,design fees, and
tenant improvements. If the expense is less than the allowance, the savings are typically
retained by the Landlord. If the expense exceeds the allowance amount, the Tenant is
responsible for the excess amount.
The process through which conclusions of property value are obtained .
Used by an appraiser to estimate the value of real estate. The three approaches are:
cost approach, income approach and market data approach.
A transfer to another of any property, real or personal, or any rights or estates in
said property.
Includes all architectural contracts and drawings such as floor plans, elevations, plot
plans, sections, details, schedules, etc., and any architectural drawing that forms a part
of the contract documents. Exceptions include mechanical, electrical and structural
drawings.
The value placed on land and buildings by a township or a county assessor for use in
levying annual real estate taxes.
An unfinished area or space between a row of columns and the bearing wall. Usually the
smallest area into which a building floor can be partitioned.
A specific amount used either as a minimum rent in a lease (retail) which uses a
percentage of sales or overage for additional rent or sets a base onto which is added
expenses and taxes in a net lease or increases in those items in a fully serviced lease.
The year of a lease term that is used as the standard when implementing an escalator
clause. Operating costs are judged higher or lower during the next year when compared to
the base year, typically the calendar year the lease commences.
Building Owners and Managers Association. BOMA publishes the definition of rentable and
useable area, which is used to determine the square footage leased in most commercial
office buildings.
The central or arterial part of a multistory building that integrates functions and
service needs for established occupants. Such areas are normally composed of mechanical
facilities, toilet facilities, elevator banks, janitors' closets, utilities, smoke shafts
and stairwells.
Building Shell
The skeleton of a building to which the finished exterior and interior are applied. It
includes the building foundation.
The exterior materials that cover a building's shell.
The specific construction standards that have been established by the owner and
architect to achieve a uniform element of design throughout the building and to establish
a cost basis for tenant improvement charges and/or allowances. Such items may be changed
only with the approval of the building owner or the managing representative.
An agreement between a landlord and a new tenant whereby the landlord assumes the
obligation of improving the demised space to the tenant's specification within the
constraints of building standards. The tenant takes possession when the space is
completed.
Common Area Maintenance charges. Those charges levied on or the expenses incurred in
maintaining the common areas of a building.
A provision in a lease that confers upon one or both of the parties to the lease the
right to terminate the lease upon the occurrence of the condition or contingency set forth
in the said clause.
The process of ascertaining the value of a property by dividing Net Operating Income by
Sale Price. (NOI/SALE PRICE.) Also know as Cap Rate.
The net operating income of a property minus its debt service.
A Percentage figure arrived at by dividing Net Annual Income by Cash Down payment.
(NAI/ CASH DOWN.)
A certificate issued by an insurance company or its agent. It verifies that a certain
insurance policy is in effect for stated amounts and coverage and names those insured.
Those areas (corridors, hallways, etc.) in an office space that are used to travel
between offices, cubicles and the like.
The date on which a lease begins. This is typically but not always the day on which the
tenant takes possession of the leased space, which usually occurs upon substantial
completion of the tenant improvements. (See Occupancy Date.)
Common area is the area used in common by the tenants of an office building. Common
area includes building and elevator lobbies, restrooms and the corridor leading from an
elevator lobby to a tenant space.
A statement issued by a local government verifying that a newly constructed building is
in compliance with all codes and may be occupied.
Failure to meet an obligation when due or to perform any provision of a lease, mortgage
or other agreement.
The walled off area of a leased space, separated from spaces leased to others by a
"demising" wall.
The scheduled gross income of a property minus the vacancy rate.
The average per square foot rent paid by the tenant over the term of a lease. Takes
into account only free rent and rental adjustments. Does not include allowances, free
parking and other similar landlord concessions.
Excludes those areas within the Useable Space that the tenant pays rent on but
effectively cannot use such as columns and sharply angled spaces.
A clause in a lease providing for an increased rental at a future time. Several such
clauses are: (1) cost of living - a clause which ties the rent to a government cost of
living index, with periodic adjustments as the index changes; (2) fixed increases - a
clause which calls for a definite, periodic rental increase; (3) direct expense - the rent
adjusted according to changes in the expenses of the property paid by the lessor, such as
tax increases, increased maintenance costs, etc.
A written agreement between two or more parties providing that certain instruments or
property be placed with a third party to be delivered to a designated person upon the
fulfillment or performance of some act or condition.
An instrument which itself prevents individuals from later asserting facts different
from those contained in the document. Often required by the buyer of an office building.
The tenant and landlord both sign the Estoppel Certificate, confirming the lease and
pertinent facts thereto. Thereafter, neither party may make claims to the contrary.
A right granted by the landlord to the tenant whereby the tenant has the option(s) to
add more space to its premises pursuant to the terms of the option(s).
A ceiling or limit on the dollar amount one party, typically the landlord, will pay in
an expense category. This ceiling is determined by adding a percentage or dollar amount to
the base year costs.
The rent which would be normally agreed upon by a willing landlord and tenant in an
"arm's length transaction" for a specific property at a given time.
Personal property or improvements so attached to the land as to become part of the real
property. The right of the tenant to remove fixtures may be given by stipulation in the
lease or by separate written agreement between the parties.
The shape and configuration of a building.
A concession granted by a landlord to a tenant whereby the tenant is excused from
paying rent for a stated period during the lease term.
A lease in which the stated rent includes the operating expenses and taxes for the
building. Same as Gross Lease and Fully Serviced Lease.
A lease in which the stated rent includes the operating expenses and taxes for the
building. Same as Gross Lease and Full Service Gross Lease.
A lease in which the stated rent includes the operating expenses of the building. Same
as Fully Serviced Lease and Full Service Gross Lease.
A figure that produces an estimate of the property's value when used as a multiplier of
the gross income of a property.
An adjustment made to operating expenses to account for the occupancy level in a
building. When operating expenses are "grossed up", it means that the building's
variable expenses have been adjusted upwards to the level that those expenses would be
incurred if the building was fully occupied (typically 95%.)
A lease of land only, either vacant or exclusive of any buildings on it. Usually a net
lease on a long term basis.
The act of a tenant retaining possession of the premises longer than the term expressed
in the lease.
A general term encompassing any system designed to heat and cool a building in its
entirety.
The process of estimating the value of an income-producing property by capitalization
of the annual net income expected to be produced by the property during its remaining
useful life.
All types of interior non load-bearing partitions that enclose or subdivide tenant
space. May be of steel, wood, glass, masonry or combinations of these materials. Such
partitions may be either movable or non-movable, prefabricated or built on the job.
The party (usually the owner) who gives the lease (right to possession) in return for a
consideration (rent).
The specific period of time in which the Landlord grants to the tenant the right to
possession of real estate.
The party to whom a lease (the right to possession) is given in return for a
consideration (rent).
The party (usually the owner) who gives the lease (right to possession) in return for a
consideration (rent).
Generally a written statement that two parties to a prospective transaction
(lessor/lessee or buyer/seller) intend to proceed to a final agreement in good faith on
stated principal business terms of the deal to be entered into. This meaning applies when
executed by both parties. Alternatively such a document may be signed only by one party
and is then an indication of a willingness to enter into agreement on the stated terms and
conditions.
The load factor is the multiplier to a tenant's useable space that accounts for the
tenant's proportionate share of the common area (restrooms, elevator lobby, mechanical
rooms, etc.). The load factor is usually expressed as a percentage and ranges from a low
of 5% for a full tenant to as high as 20% for a multi-tenant floor. See BOMA Standard.
The process of estimating the value of property through the examination and comparison
of actual sales of comparable properties.
The highest price that a buyer ready, willing and able but not compelled to buy, would
pay, and the lowest a seller ready, willing and able but not compelled to sell, would
accept.
A lien established by law in favor of those who provide labor or material for the
improvement of real estate.
A tenancy from month to month is generally created when no definite lease term is
specified by the parties and the rent is payable monthly. Such a lease may be written or
oral, and can be terminated by either party at the end of any month. Otherwise, it is
renewed automatically from month to month on the same terms.
Metal or wood strips placed at regular intervals along a window line. They are designed
to receive a wall partition in a manner ensuring a smooth, soundproof connection.
Used by an appraiser to estimate the value of real estate. The three approaches are:
cost approach, income approach and market data approach.
A transfer to another of any property, real or personal, or any rights or estates in
said property.
Includes all architectural contracts and drawings such as floor plans, elevations, plot
plans, sections, details, schedules, etc., and any architectural drawing that forms a part
of the contract documents. Exceptions include mechanical, electrical and structural
drawings.
The value placed on land and buildings by a township or a county assessor for use in
levying annual real estate taxes.
An unfinished area or space between a row of columns and the bearing wall. Usually the
smallest area into which a building floor can be partitioned.
A specific amount used either as a minimum rent in a lease (retail) which uses a
percentage of sales or overage for additional rent or sets a base onto which is added
expenses and taxes in a net lease or increases in those items in a fully serviced lease.
The year of a lease term that is used as the standard when implementing an escalator
clause. Operating costs are judged higher or lower during the next year when compared to
the base year, typically the calendar year the lease commences.
Building Owners and Managers Association. BOMA publishes the definition of rentable and
useable area, which is used to determine the square footage leased in most commercial
office buildings.
The central or arterial part of a multistory building that integrates functions and
service needs for established occupants. Such areas are normally composed of mechanical
facilities, toilet facilities, elevator banks, janitors' closets, utilities, smoke shafts
and stairwells.
The skeleton of a building to which the finished exterior and interior are applied. It
includes the building foundation.
The exterior materials that cover a building's shell.
The specific construction standards that have been established by the owner and
architect to achieve a uniform element of design throughout the building and to establish
a cost basis for tenant improvement charges and/or allowances. Such items may be changed
only with the approval of the building owner or the managing representative.
An agreement between a landlord and a new tenant whereby the landlord assumes the
obligation of improving the demised space to the tenant's specification within the
constraints of building standards. The tenant takes possession when the space is
completed.
Common Area Maintenance charges. Those charges levied on or the expenses incurred in
maintaining the common areas of a building.
A provision in a lease that confers upon one or both of the parties to the lease the
right to terminate the lease upon the occurrence of the condition or contingency set forth
in the said clause.
The process of ascertaining the value of a property by dividing Net Operating Income by
Sale Price. (NOI/SALE PRICE.) Also know as Cap Rate.
The net operating income of a property minus its debt service.
A Percentage figure arrived at by dividing Net Annual Income by Cash Down payment.
(NAI/ CASH DOWN.)
A certificate issued by an insurance company or its agent. It verifies that a certain
insurance policy is in effect for stated amounts and coverage and names those insured.
Those areas (corridors, hallways, etc.) in an office space that are used to travel
between offices, cubicles and the like.
The date on which a lease begins. This is typically but not always the day on which the
tenant takes possession of the leased space, which usually occurs upon substantial
completion of the tenant improvements. (See Occupancy Date.)
Common area is the area used in common by the tenants of an office building. Common
area includes building and elevator lobbies, restrooms and the corridor leading from an
elevator lobby to a tenant space.
A statement issued by a local government verifying that a newly constructed building is
in compliance with all codes and may be occupied.
Failure to meet an obligation when due or to perform any provision of a lease, mortgage
or other agreement.
The walled off area of a leased space, separated from spaces leased to others by a
"demising" wall.
The scheduled gross income of a property minus the vacancy rate.
The average per square foot rent paid by the tenant over the term of a lease. Takes
into account only free rent and rental adjustments. Does not include allowances, free
parking and other similar landlord concessions.
Excludes those areas within the Useable Space that the tenant pays rent on but
effectively cannot use such as columns and sharply angled spaces.
A clause in a lease providing for an increased rental at a future time. Several such
clauses are: (1) cost of living - a clause which ties the rent to a government cost of
living index, with periodic adjustments as the index changes; (2) fixed increases - a
clause which calls for a definite, periodic rental increase; (3) direct expense - the rent
adjusted according to changes in the expenses of the property paid by the lessor, such as
tax increases, increased maintenance costs, etc.
A written agreement between two or more parties providing that certain instruments or
property be placed with a third party to be delivered to a designated person upon the
fulfillment or performance of some act or condition.
An instrument which itself prevents individuals from later asserting facts different
from those contained in the document. Often required by the buyer of an office building.
The tenant and landlord both sign the Estoppel Certificate, confirming the lease and
pertinent facts thereto. Thereafter, neither party may make claims to the contrary.
A right granted by the landlord to the tenant whereby the tenant has the option(s) to
add more space to its premises pursuant to the terms of the option(s).
A ceiling or limit on the dollar amount one party, typically the landlord, will pay in
an expense category. This ceiling is determined by adding a percentage or dollar amount to
the base year costs.
The rent which would be normally agreed upon by a willing landlord and tenant in an
"arm's length transaction" for a specific property at a given time.
Personal property or improvements so attached to the land as to become part of the real
property. The right of the tenant to remove fixtures may be given by stipulation in the
lease or by separate written agreement between the parties.
The shape and configuration of a building.
A concession granted by a landlord to a tenant whereby the tenant is excused from
paying rent for a stated period during the lease term.
A lease in which the stated rent includes the operating expenses and taxes for the
building. Same as Gross Lease and Fully Serviced Lease.
A lease in which the stated rent includes the operating expenses and taxes for the
building. Same as Gross Lease and Full Service Gross Lease.
A lease in which the stated rent includes the operating expenses of the building. Same
as Fully Serviced Lease and Full Service Gross Lease.
A figure that produces an estimate of the property's value when used as a multiplier of
the gross income of a property.
An adjustment made to operating expenses to account for the occupancy level in a
building. When operating expenses are "grossed up", it means that the building's
variable expenses have been adjusted upwards to the level that those expenses would be
incurred if the building was fully occupied (typically 95%.)
A lease of land only, either vacant or exclusive of any buildings on it. Usually a net
lease on a long term basis.
The act of a tenant retaining possession of the premises longer than the term expressed
in the lease.
A general term encompassing any system designed to heat and cool a building in its
entirety.
The process of estimating the value of an income-producing property by capitalization
of the annual net income expected to be produced by the property during its remaining
useful life.
All types of interior non load-bearing partitions that enclose or subdivide tenant
space. May be of steel, wood, glass, masonry or combinations of these materials. Such
partitions may be either movable or non-movable, prefabricated or built on the job.
The party (usually the owner) who gives the lease (right to possession) in return for a
consideration (rent).
The specific period of time in which the Landlord grants to the tenant the right to
possession of real estate.
The party to whom a lease (the right to possession) is given in return for a
consideration (rent).
The party (usually the owner) who gives the lease (right to possession) in return for a
consideration (rent).
Generally a written statement that two parties to a prospective transaction
(lessor/lessee or buyer/seller) intend to proceed to a final agreement in good faith on
stated principal business terms of the deal to be entered into. This meaning applies when
executed by both parties. Alternatively such a document may be signed only by one party
and is then an indication of a willingness to enter into agreement on the stated terms and
conditions.
The load factor is the multiplier to a tenant's useable space that accounts for the
tenant's proportionate share of the common area (restrooms, elevator lobby, mechanical
rooms, etc.). The load factor is usually expressed as a percentage and ranges from a low
of 5% for a full tenant to as high as 20% for a multi-tenant floor. See BOMA Standard.
The process of estimating the value of property through the examination and comparison
of actual sales of comparable properties.
The highest price that a buyer ready, willing and able but not compelled to buy, would
pay, and the lowest a seller ready, willing and able but not compelled to sell, would
accept.
A lien established by law in favor of those who provide labor or material for the
improvement of real estate.
A tenancy from month to month is generally created when no definite lease term is
specified by the parties and the rent is payable monthly. Such a lease may be written or
oral, and can be terminated by either party at the end of any month. Otherwise, it is
renewed automatically from month to month on the same terms.
Metal or wood strips placed at regular intervals along a window line. They are designed
to receive a wall partition in a manner ensuring a smooth, soundproof connection. Back to Top
A lease controlling subsequent leases.
Used by an appraiser to estimate the value of real estate. The three approaches are:
cost approach, income approach and market data approach.
A transfer to another of any property, real or personal, or any rights or estates in
said property.
Includes all architectural contracts and drawings such as floor plans, elevations, plot
plans, sections, details, schedules, etc., and any architectural drawing that forms a part
of the contract documents. Exceptions include mechanical, electrical and structural
drawings.
The value placed on land and buildings by a township or a county assessor for use in
levying annual real estate taxes.
An unfinished area or space between a row of columns and the bearing wall. Usually the
smallest area into which a building floor can be partitioned.
A specific amount used either as a minimum rent in a lease (retail) which uses a
percentage of sales or overage for additional rent or sets a base onto which is added
expenses and taxes in a net lease or increases in those items in a fully serviced lease.
The year of a lease term that is used as the standard when implementing an escalator
clause. Operating costs are judged higher or lower during the next year when compared to
the base year, typically the calendar year the lease commences.
Building Owners and Managers Association. BOMA publishes the definition of rentable and
useable area, which is used to determine the square footage leased in most commercial
office buildings.
The central or arterial part of a multistory building that integrates functions and
service needs for established occupants. Such areas are normally composed of mechanical
facilities, toilet facilities, elevator banks, janitors' closets, utilities, smoke shafts
and stairwells.
The skeleton of a building to which the finished exterior and interior are applied. It
includes the building foundation.
The exterior materials that cover a building's shell.
The specific construction standards that have been established by the owner and
architect to achieve a uniform element of design throughout the building and to establish
a cost basis for tenant improvement charges and/or allowances. Such items may be changed
only with the approval of the building owner or the managing representative.
An agreement between a landlord and a new tenant whereby the landlord assumes the
obligation of improving the demised space to the tenant's specification within the
constraints of building standards. The tenant takes possession when the space is
completed.
Common Area Maintenance charges. Those charges levied on or the expenses incurred in
maintaining the common areas of a building.
A provision in a lease that confers upon one or both of the parties to the lease the
right to terminate the lease upon the occurrence of the condition or contingency set forth
in the said clause.
The process of ascertaining the value of a property by dividing Net Operating Income by
Sale Price. (NOI/SALE PRICE.) Also know as Cap Rate.
The net operating income of a property minus its debt service.
A Percentage figure arrived at by dividing Net Annual Income by Cash Down payment.
(NAI/ CASH DOWN.)
A certificate issued by an insurance company or its agent. It verifies that a certain
insurance policy is in effect for stated amounts and coverage and names those insured.
Those areas (corridors, hallways, etc.) in an office space that are used to travel
between offices, cubicles and the like.
The date on which a lease begins. This is typically but not always the day on which the
tenant takes possession of the leased space, which usually occurs upon substantial
completion of the tenant improvements. (See Occupancy Date.)
Common area is the area used in common by the tenants of an office building. Common
area includes building and elevator lobbies, restrooms and the corridor leading from an
elevator lobby to a tenant space.
A statement issued by a local government verifying that a newly constructed building is
in compliance with all codes and may be occupied.
Failure to meet an obligation when due or to perform any provision of a lease, mortgage
or other agreement.
The walled off area of a leased space, separated from spaces leased to others by a
"demising" wall.
The scheduled gross income of a property minus the vacancy rate.
The average per square foot rent paid by the tenant over the term of a lease. Takes
into account only free rent and rental adjustments. Does not include allowances, free
parking and other similar landlord concessions.
Excludes those areas within the Useable Space that the tenant pays rent on but
effectively cannot use such as columns and sharply angled spaces.
A clause in a lease providing for an increased rental at a future time. Several such
clauses are: (1) cost of living - a clause which ties the rent to a government cost of
living index, with periodic adjustments as the index changes; (2) fixed increases - a
clause which calls for a definite, periodic rental increase; (3) direct expense - the rent
adjusted according to changes in the expenses of the property paid by the lessor, such as
tax increases, increased maintenance costs, etc.
A written agreement between two or more parties providing that certain instruments or
property be placed with a third party to be delivered to a designated person upon the
fulfillment or performance of some act or condition.
An instrument which itself prevents individuals from later asserting facts different
from those contained in the document. Often required by the buyer of an office building.
The tenant and landlord both sign the Estoppel Certificate, confirming the lease and
pertinent facts thereto. Thereafter, neither party may make claims to the contrary.
A right granted by the landlord to the tenant whereby the tenant has the option(s) to
add more space to its premises pursuant to the terms of the option(s).
A ceiling or limit on the dollar amount one party, typically the landlord, will pay in
an expense category. This ceiling is determined by adding a percentage or dollar amount to
the base year costs.
The rent which would be normally agreed upon by a willing landlord and tenant in an
"arm's length transaction" for a specific property at a given time.
Personal property or improvements so attached to the land as to become part of the real
property. The right of the tenant to remove fixtures may be given by stipulation in the
lease or by separate written agreement between the parties.
The shape and configuration of a building.
A concession granted by a landlord to a tenant whereby the tenant is excused from
paying rent for a stated period during the lease term.
A lease in which the stated rent includes the operating expenses and taxes for the
building. Same as Gross Lease and Fully Serviced Lease.
A lease in which the stated rent includes the operating expenses and taxes for the
building. Same as Gross Lease and Full Service Gross Lease.
A lease in which the stated rent includes the operating expenses of the building. Same
as Fully Serviced Lease and Full Service Gross Lease.
A figure that produces an estimate of the property's value when used as a multiplier of
the gross income of a property.
An adjustment made to operating expenses to account for the occupancy level in a
building. When operating expenses are "grossed up", it means that the building's
variable expenses have been adjusted upwards to the level that those expenses would be
incurred if the building was fully occupied (typically 95%.)
A lease of land only, either vacant or exclusive of any buildings on it. Usually a net
lease on a long term basis.
The act of a tenant retaining possession of the premises longer than the term expressed
in the lease.
A general term encompassing any system designed to heat and cool a building in its
entirety.
The process of estimating the value of an income-producing property by capitalization
of the annual net income expected to be produced by the property during its remaining
useful life.
All types of interior non load-bearing partitions that enclose or subdivide tenant
space. May be of steel, wood, glass, masonry or combinations of these materials. Such
partitions may be either movable or non-movable, prefabricated or built on the job.
The party (usually the owner) who gives the lease (right to possession) in return for a
consideration (rent).
The specific period of time in which the Landlord grants to the tenant the right to
possession of real estate.
The party to whom a lease (the right to possession) is given in return for a
consideration (rent).
The party (usually the owner) who gives the lease (right to possession) in return for a
consideration (rent).
Generally a written statement that two parties to a prospective transaction
(lessor/lessee or buyer/seller) intend to proceed to a final agreement in good faith on
stated principal business terms of the deal to be entered into. This meaning applies when
executed by both parties. Alternatively such a document may be signed only by one party
and is then an indication of a willingness to enter into agreement on the stated terms and
conditions.
The load factor is the multiplier to a tenant's useable space that accounts for the
tenant's proportionate share of the common area (restrooms, elevator lobby, mechanical
rooms, etc.). The load factor is usually expressed as a percentage and ranges from a low
of 5% for a full tenant to as high as 20% for a multi-tenant floor. See BOMA Standard.
The process of estimating the value of property through the examination and comparison
of actual sales of comparable properties.
The highest price that a buyer ready, willing and able but not compelled to buy, would
pay, and the lowest a seller ready, willing and able but not compelled to sell, would
accept.
A lien established by law in favor of those who provide labor or material for the
improvement of real estate.
A tenancy from month to month is generally created when no definite lease term is
specified by the parties and the rent is payable monthly. Such a lease may be written or
oral, and can be terminated by either party at the end of any month. Otherwise, it is
renewed automatically from month to month on the same terms.
Metal or wood strips placed at regular intervals along a window line. They are designed
to receive a wall partition in a manner ensuring a smooth, soundproof connection.
Back to Top
A lease controlling subsequent leases.
Back to Top
A lease controlling subsequent leases.
(Net operating income - Annual debt service.)
The effective gross income from a property minus operating expenses.
A lease in which the stated rent excludes the insurance, utilities, operating expenses
and real estate taxes for the building. The tenant is then responsible for the payment of
these costs either directly or as additional rent. Also called "Triple Net" or
NNN.
The area (square footage) for which rent can be charged. Generally it is the gross area
of the full floor less the area of all vertical penetrations (elevator shafts, stairwells,
mechanical shafts etc.) Rentable area can be measured in many ways, but the most common
measurement for office buildings is according to BOMA standards. Net Rentable area
includes the tenant's premises plus an allocation of the common area directly benefiting
the tenant, such as common corridors, restrooms, mechanical and janitor's rooms and the
elevator lobby on the tenant's floor. Also called Rentable Area.
So long as lease is not in default, its rights to occupancy under the lease will not be
disturbed by the lessor or it's successors or assigns.
Any cost or charge incurred by a tenant pursuant to its lease, such as rent, operating
expense increases, parking charges, moving expenses, remodeling costs, etc.
Unless specifically stated otherwise in the lease, it is the date on which the tenant
takes possession of its leased premises. (See also "Commencement Date".)
The cost of operating an office building, such as utilities, janitorial, management
fees, and similar day to day expenses, as well as taxes, insurance, and a reserve for
replacement of items which periodically wear out .Should not include capital expenses such
as roof replacement nor expenses associated with the production of income such as leasing
commissions and legal fees.
An increase in operating expenses over the base year amount that is billed to the
tenant as additional rent.
Lease under which the tenant pays a fixed minimum monthly rent plus a percentage of his
or her gross monthly income in excess of that minimum. Used primarily in retail leases.
Typically the entire rentable area leased by lessee. Sometimes used to designate solely
the useable area leased by lessee, i.e. that for which the lessee has exclusive occupancy
as opposed to the common areas.
A set of figures projecting costs and income on a proposed new property. Used as a
basis for capitalization.
A standard applied in a lease which limits the landlord's ability to withhold consent
in its sole discretion.
A list prepared by the architect, designer and owner and formally submitted to the
contractor to note any deficiencies when they check all completed construction, which
assures verification that such work has been accomplished in a good, workmanlike manner in
respect to the contract documents.
A covenant, usually inserted into leases and conveyances on the part of the grantor,
promising that the tenant or grantee shall enjoy possession of the premises in peace and
without disturbance.
A clause in a lease agreement providing for lessor's retaking or recovering possession
of the premises, usually by cancellation of the lease under certain conditions.
The current cost of replacing the subject property with property having exactly the
same utility and amenities.
The right of a tenant to renew (extend the term of) a lease for a stated period of time
at a rent to be determined (i.e. 9.5% of "fair market rent".)
Consideration paid for the occupancy and use of real property. Also a general term
covering any consideration (not only money.)
The (square footage) for which rent can be charged. Generally it is the gross area of
the full floor less the area of all vertical penetrations (elevator shafts, stairwells,
mechanical shafts etc.) Rentable area can be measured in many ways, but the most common
measurement for office buildings is according to Boma Standards.
The amount of Rent paid for the occupancy and use of real property. Typically stated on
a per square foot per month or per year basis.
A document typically issued by a tenant's agent to an owner(s) of real property,
inviting the owner(s) to submit a proposal to the tenant for the leasing of a vacant
space. The RFP sets forth the specific areas of concern to the tenant, such as the space
in question, the lease term, expansion and renewal options, rental rate, and tenant
improvements and other allowances to be provided by the owner.
A right, usually given by an owner to a tenant, which gives the tenant a first chance
to buy the property or lease a portion of the property if the owner decides to sell or
lease. Unlike a Right of First Refusal, the owner is not required to have a legitimate
offer which the tenant can then match or refuse. If the tenant refuses to make an offer or
if the parties cannot agree on terms, the property can then be sold or leased to a third
party.
A right, usually given by an owner to a tenant, which gives the tenant a first chance
to buy the property or lease a portion of the property if the owner decides to sell or
lease. The owner must have a legitimate offer which the tenant can match or refuse. If the
tenant refuses, the property can then be sold or leased to the offeror.
A specific clause in a lease where the tenant has the right to deduct from the rent
certain costs which are due to the tenant from the landlord. Included may be the costs
incurred by tenant to cure defaults of the landlord, after notice and failure by landlord
to cure the defaults.
Building standards that are binding on the tenants are usually set forth in a part of
the lease covering such things as use of common areas, door lettering, signs, noise,
odors, moving or installation of equipment, special locks, etc.
The rental rate of a property multiplied by the total rentable space.
(1) A design concerning the building program resulting from inspection of the site and
conferences with the client. The client's needs and requirements are carefully analyzed.
Zoning regulations and codes affecting the work are studied. Sketches and statements of
probable construction costs are prepared for the owner's approval. (2) A suggested plan,
design or program of action.
An analysis of an existing office situation to locate problem areas and to provide a
basis for judgment in evaluating major changes. Also, it can be in the form of planning
tools that will be used by the client in developing a planning decision. This includes
space standards, adjacency requirements and space requirements.
Most often it is the planning of the layout of the interior space of a building to meet
the needs of the user. Can also include detailed interior design and preparation of
construction drawings.
A lease, under which the lessor is the lessee of a prior lease of the same property.
Generally used in reference to the construction of tenant improvements (TIs). The
tenant's premises is typically deemed to be substantially completed when all of the TIs
for the premises have been completed in accordance with plans and specifications
previously approved by the tenant. Sometimes used to define the commencement date of a
lease.
Overhead lighting systems that provide each workspace with individual overhead lighting
controls. Designed to conserve energy by lighting only work areas that are occupied at any
given time.
A holder of an interest in property for a specific term under a lease or other rental
agreement (generally a right to occupancy and use).
Improvements to land or buildings to meet the needs of tenants. May be new improvements
or remodeling, and be paid for by the landlord, tenant or part by each.
An agent who is an advocate for the tenant.
Articles installed by a tenant under terms of a lease and removable by the tenant
before the lease expires. These remain personal property; they are not true fixtures.
A lease requiring the tenant to pay in addition to a fixed rental, the expenses of the
property such as taxes, insurance, maintenance, utilities, cleaning etc. The terms
"net net", "net net net", "triple net", are used.
Referring to an owner making a property ready for a tenant to begin business by having
the tenant furnish only furniture, phone and inventory, if any. Turnkey tenant
improvements are provided at the landlord's expense according to plans and specifications
previously agreed upon by the parties. Unlike an allowance where the tenant pays for costs
in excess of the allowance amount, the landlord bears the risk of construction in a
turnkey situation.
The secured area (square footage)occupied exclusively by tenant within a tenant's
leased space. The useable area times the load factor for common area results in rentable
area on which rent is charged. Useable area can be measured in many ways, but the most
common measurement for office buildings is according to BOMA standards.
Annual gross income multiplied by percent vacant (AGI X % VACANCY)
Specifications for tenant improvements usually attached to a lease and/or letter of
intent. The work letter provides the basis for working drawings and contractor pricing and
may allocate costs between the parties. Also establishes critical dates for approval of
drawings and processes.
Drawings prepared by a licensed architect and used by contractors in the construction
of tenant improvements. Shows all architectural detail such as electric, plumbing,
partitions, etc.
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