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In the Spotlight: SNDAs: Insights From the Lender Side

By Alison Boyer
September 02, 2014

When negotiating a lease, it may be easy to skim over the subordination clause and trust that the boilerplate is sufficient. In many cases, the party that will give this section the most attention is a future lender who will review the lease in connection with its loan due diligence. Tenants and landlords alike may not have a full appreciation for the analysis that a lender undertakes in assessing the leases affecting a property that will serve as collateral for the proposed loan. This article highlights the issues and concerns that a lender faces when determining whether to require a separate subordination agreement ' typically, a Subordination, Non-Disturbance and Attornment Agreement or a SNDA ' and in negotiating a SNDA with the tenant.

When the Subordination Provision Is Not Enough

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