📖 Reference
Commercial Lease Glossary
The clauses and concepts that decide whether a lease abstract is right — defined in plain language, with worked examples and the traps our abstraction specialists check for on every document.
Base rent
Base rent is the fixed periodic amount — usually stated monthly or annually per square foot — that a tenant pays a landlord for the right to…
CAM gross-up
A CAM gross-up clause lets a landlord scale variable common area maintenance costs up to a stipulated occupancy level — commonly 95% — befor…
CAM reconciliation
CAM reconciliation is the annual true-up between the estimated common area maintenance (CAM) charges a tenant paid during the year and the t…
Casualty clause
A casualty clause is the lease provision that sets out what happens if the premises (or the building) are damaged or destroyed by fire, stor…
Co-tenancy clause
A co-tenancy clause is a retail lease provision that ties a tenant's rent obligation to the continued presence of other tenants at the shopp…
Commercial security deposit
A commercial security deposit is money or a letter of credit a tenant provides to secure its performance under a lease, which the landlord c…
Demised premises
The demised premises are the specific space a lease grants ("demises") to the tenant — typically defined by suite number, a floor-plan exhib…
Estoppel certificate
An estoppel certificate is a signed statement in which a tenant confirms the current facts of its lease — the rent being paid, the lease ter…
Holdover tenancy
A holdover tenancy arises when a tenant remains in the premises after the lease term expires without having exercised a renewal or signed an…
Kick-out clause
A kick-out clause is a lease provision that lets a tenant terminate early if a defined performance condition is not met — most commonly, gro…
Lease administration
Lease administration is the ongoing management of an active lease portfolio: tracking critical dates and option windows, generating rent and…
Operating expense stop
An operating expense stop (or "expense stop") is a dollar amount, typically stated per square foot, that caps the operating expenses a landl…
Percentage rent
Percentage rent is additional rent a retail tenant pays on top of (or sometimes instead of) fixed minimum rent, calculated as a stated perce…
Rent abatement
Rent abatement is a temporary suspension or reduction of a tenant's rent obligation, granted either as a fixed concession period at the star…
SNDA
An SNDA is a three-part agreement among a tenant, a landlord, and the landlord's mortgage lender. Subordination puts the lease behind the mo…
Tenant improvement allowance
A tenant improvement allowance — often shortened to TI allowance or T.I. allowance — is a sum a landlord agrees to contribute toward the cos…
Triple net lease
A triple net lease (NNN) is a commercial lease structure in which the tenant pays base rent plus its pro-rata share of the three operating "…
Use clause
A use clause is the lease provision that defines what business activity a tenant is permitted to conduct in the premises — narrowly ("a Star…