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The following definitions are provided to give you a general
understanding of how these terms are understanding of how these
terms are understood in the industry. This is not a legal
interpretation and should not be relied upon. As a general rule,
there is no such thing as "standard" language and all parties should
ask for a further explanation if a term isn’t understood. If you don't
see a term here, feel free to contact us and we will be happy to
discuss it with you.
1031 Exchange
This is a provision of the tax code that allows the Seller of a
property to defer payment of certain taxes if they buy another
property or properties within a specified time frame. Because of
the implications, good tax and legal counsel is always
recommended.
Above-Standard Services
A multi-tenant building attempts to treat all tenants equally. This
includes charging them in an equitable manner. So all are charged
for standard services and those that have special needs are
charged separately for those services. This could include
electricity usage if they occupy their space beyond normal
business hours or have equipment which consumes an excessive
amount of electricity.
Above-Standard TI’s
Construction (tenant improvements) required by tenant over and
above that considered standard or typical in the building. These
items typically include wood or stone floors, crown molding,
cabinets, appliances, lighting other than the building standard
fluorescent fixtures, etc. These are described in detail in the work
letter of the lease and on the construction documents.
Add-On Factor
The percentage of difference between the Rentable Area and the
Usable Area divided by the Usable Area.
American with Disabilities Act (ADA)
Federal regulations intended to equalize access for people with
disabilities in buildings. New buildings must comply in order to
obtain their building permits. Lease spaces in existing buildings
must comply when substantially remodeled. Architects are
required by law in the State of Texas to send plans to the state if
the cost of remodeling is expected to exceed $50,000.
Amortization of TI’s
A method for the landlord to pay for above-standard TI’s and then
finance them by increasing the rental rate over all or a portion of the
term of the lease.
Assignment
The transfer of all obligations and rights of the lease or purchase
contract to another party. This is often used in an offer letter, so that
a Buyer would have the time to establish its final form of ownership,
such as an LLC. An assignment does not necessarily relieve the
assigning party of its obligation or liabilities. Confer with legal
counsel.
Attornment
Lease provision in which the tenant agrees, in advance, to accept
or pay rent to a new landlord or new owner. This is important if the
current landlord defaults on their mortgage.
Base Rent
The basic per-annum rental specified in the lease.
Base Year or Expense Stop
The expenses in a given year (usually the first year of the lease)
over which the tenant is responsible for operating expenses. For
example, if your base year is 2004 and the actual expenses in that
year were $7.75 per square foot (/SF), then that would be
considered your base year or expense stop for the remainder of
the lease. You would then be responsible for your prorated share
of any increase in subsequent years. If expenses go up to $8.50
/SF in 2005, you would be billed an extra $0.75/SF. That doesn’t
sound like much, but if you lease 5,000 SF, that means a bill for
$3,750. An expense stop is the same thing except that it is
typically stated in the lease as a specific number regardless of
what the actual expenses are in the first year of the lease.
Building Core
The vertical backbone of the building usually in the center of the
building including elevators, air shafts, restrooms, stairways,
mechanical and electrical rooms, etc.
Building Standard TI’s
The tenant improvements routinely offered to all prospective
tenants in a building. These are described in detail in the work
letter of the lease and on the construction documents.
Buyer’s Representative
A Licensed Real Estate Agent working solely for the Buyer, not the
Seller. Agency rules allow the Buyers Agent to receive a
commission from the Seller even though he does not represent the
Seller. Most Sellers have their own Sellers agents working to get
them the best price and terms. The parties to the transaction must
be informed ahead of the negotiations of this status.
CAP Rate
Abbreviation for Capitalization rate. This is basically the net
operating income (NOI) of the property divided by the purchase
price. It can be viewed as the rate of return an investor would
receive if the property was purchased with 100% cash. For
example, a $100,000 property being sold on a 10% cap means
that the NOI is $10,000.
Class A, B, or C
This refers to the quality of the building compared to the other
buildings in the submarket. This is determined by the market as a
whole and can vary from one submarket to another. The
determination is usually based on age, image, amenities, access,
etc. A building considered to be class A in the Stemmons
Freeway market might be considered class C if it were in the
central business district.
Commencement Date
A date which Landlord and Tenant agree the lease actually started.
This may be different than the occupancy date or rent
commencement date. Often, a commencement letter will be
signed by both parties once the date is determined. The
commencement date often determines when rent will commence
and acceptance of the property condition.
Common Areas
Portions of the building designated for the benefit of all tenants
such as lobbies, corridors, restrooms and mechanical areas.
Demising Walls
The walls which separate or demise the leased premises from
adjacent tenants.
Direct Pass-Through or Operating Expense Escalation
A formula through which the tenant is charged its prorated share of
increases in the building’s real estate taxes and/or operating
expenses over the base year or expense stop.
Dual Agent
Refers to a Licensed Real Estate Agent who claims to be
representing the best interests of both the Tenant and Landlord, or
both the Buyer and Seller.
Effective Annual Rent
The average rental rate of the total lease term after taking into
account any free rent or base rent steps.
Estoppel Certificate
A document signed by the Tenant that confirms they are the tenant,
confirms various terms of the lease, confirms that the lease is not in
default, and confirms the amount of rent and any security deposit
the Landlord is holding. It is usually required to be signed by the
Tenant when an owner sells or refinances the property.
Executive Suites
An operating business which leases a large space within a building
and then subleases individual offices to other companies. In
addition to the space, the subtenant has access to secretarial and
receptionist services, copies, fax, phone, conference room, break
room, etc. The rental rate per square foot is usually far higher than
a direct lease because of these additional services.
Expansion Option
The agreed-upon terms upon which a tenant has a right, but not an
obligation, to expand into specific additional space.
Expense Stop
A dollar amount usually stated as an amount per foot per year that
the Landlord agrees to pay for building expenses. If expenses of
the building exceed this amount, then the Tenant pays the amount
above the expense stop.
Full Service or Gross
A term which means that the rental rate includes all costs of
operating the building including heat, lights, air conditioning,
maintenance, management, security, landscaping, janitorial and
general operation of the property. There many modifications to this
including “plus E” meaning full service plus electric charges,
“industrial gross” meaning that the tenant pays electric and
janitorial separately, and “triple net” meaning that the tenant pays all
operating expenses on top of the base rent.
Guaranty
Signer (guarantor) assures Landlord that Tenant signing the lease
will pay the rent and, if not, the signer (guarantor) will be obligated
to fulfill the lease. This is used when the Tenant may be financially
weak or substantial tenant improvements are requested by the
Tenant. Guarantor can be a corporation or a person.
Gross Rent Multiplier
This term is typically only used with multi-family properties –
apartments. It is simply the purchase price divided by the gross
potential rent of the property. So a $4,000,000 purchase price with
gross potential rent of $750,000 would have a GRM of 5.33.
Gross Up
A technique used to adjust the operating expenses of a building to
a level that would exist if the building were fully occupied. This
allows for a more equitable calculation of the base year expenses
and subsequent years’ expense escalations payable by tenants.
HVAC
Heating, ventilating and air conditioning.
Holding Over
When a tenant continues to occupy the leased premises after the
lease has expired. It can occur with or without the landlord’s
consent. Leases usually state a holdover rent increase (i.e. 150-
200% of current rate) until the tenant vacates or renegotiates the
lease.
Indexed Escalation
An escalation formula that increases the rent each year by a fixed
or variable percentage.
Lease Commencement
The date on which the lease starts. This may be a different date
than tenant moves in or starts paying rent.
Leased Premises
The space which is leased to the tenant usually for its exclusive use
within the demising walls.
Lessee
The Tenant.
Lessor
The landlord or owner.
Letter of Intent
A document that outlines the general terms of a proposed lease or
purchase. It becomes the basis from which a formal lease or
purchase document is written. These are typically not binding
between the parties depending on language used.
Modified Gross Lease
As opposed to a full service lease, a modified gross lease requires
that the tenant pays some of the expenses directly – typically
electricity, janitorial and/or water. In comparing leases, it is
important to adjust for the differences in the lease rates.
Monument Sign
A large sign containing the names of one or more tenants that is
normally on the ground facing the street in front of the building, but
not attached to it.
Mullions
The metal posts between the exterior windows. Landlords typically
require that walls terminate on a mullion instead of in the middle of
a window.
Net Present Value
The current value of a future cash flow stream discounted at a given
rate.
Operating Expenses
Expenses related to the building and property including electricity,
water, gas, janitorial, parking lot sweeping, landscape
maintenance, building maintenance (except major renovations),
real estate taxes, insurance, and management fees. These items
should be detailed in the lease document in order to avoid
confusion.
Owner’s Agent
A licensed Real Estate agent working to get the best deal for the
Owner or Landlord frequently referred to as the Listing Agent.
Parking Ratio
The number of parking spaces divided by the total size of the
building. A ratio of 1:250 means there is one parking space for
every 250 square feet in the building. The lower the ratio, the more
parking spaces there are. Tenants need to be sure this resulting
number of spaces available to it will accommodate its employees
and visitors.
Pass-Throughs
This refers to operating expenses that are incurred on the property
that are passed through to the tenants. Contrasting this are those
expenses or costs that can not be passed through such as capital
improvements or major replacements.
Percentage Rent
This is typically only used for retail tenants. This is rent calculated
by applying a percentage stated in the lease to the tenant’s income
generated from that location.
Permitted Uses
The uses or activities allowed to be performed in the leased
premises. This becomes particularly important if zoning is in
question or if Tenant plans to sublease its space.
Phase One Study
A review of the current and historical environmental condition of a
property. Owners typically have a Phase One done prior to
purchasing a property. Large tenants occasionally require them.
And lenders usually want one done before they will either lend on or
foreclose on a property.
Preliminary Title Report
Generated by a title company as a review of liens, encumbrances,
ownership, and taxes on a property. This is normally done in
preparation for a sale transaction.
Pro-rata Share
An amount calculated by dividing the square footage of the tenant’s
space by the entire building size. A 1,000 SF tenant would have a
10% pro-rata share of a 10,000 SF building.
Real Estate Tax
This is the property tax paid to the county, city, school district, etc.
This is paid once a year between October 1 and January 31 to
avoid interest and penalties. The lease should require that the
landlord protest the assessed value annually to ensure the taxes
are always as low as possible. Reserved usually means the Tenant
is paying for it, whether per space or as part of the lease.
Recapture
The right of the landlord to void a tenant’s lease for all, or a portion,
of the premises in order to prevent a sublease or assignment.
Renewal Option
A lease clause specifying the terms and conditions under which the
tenant may extend the lease term without obligating the tenant to do
so.
Rent Abatement or Free Rent
A period of time during which the tenant is not charged rent for
space under lease.
Rent Commencement
The date upon which the tenant is obligated to begin paying rent.
Rent Steps
Agreed-upon increases in the Base Rent that take effect at
specified dates during the term of the lease.
Rentable Area
The square footage used to calculate Base Rent. It is the Usable
Area that a tenant actually occupies plus a percentage of common
areas.
Sublease
An agreement whereby a tenant finds another tenant to occupy all
or a portion of the leased premises. This is often done when a
tenant closes an office or outgrows its space. It is important to
include the appropriate language in the lease when first signed to
give the primary tenant the right to sublease if that ever becomes
necessary. It does not normally release the primary tenant or their
guarantors from the lease obligations. The landlord must consent.
Sublease Premium
The amount by which rent paid on a sublease exceeds that paid on
the underlying lease. Leases generally state that any premium
must be paid to the landlord, but a split can often be negotiated.
Security Deposit
Money collected at the execution of the lease to provide additional
confidence the Tenant will perform. It is not normally the last months
rent, but is typically equal to that amount. Landlords will require the
deposit be increased as their risk increases. Letters of credit can
often be used in lieu of cash deposits.
Submetered Electric
A separate charge for electricity shown on a submeter monitoring
the actual consumption of a large computer room, piece of
equipment or machinery.
Tenant Improvement Allowance
A dollar amount provided by the landlord for the construction in the
leased premises to make it ready for tenant’s occupancy.
Tenant Improvements (TI’s) or Build-out
Interior construction necessary to customize the space for
occupancy by the tenant.
Tenant Representative
A Licensed Real Estate Agent working for the best interests of the
Tenant, not the Landlord. They usually don't have a listing
agreement or agency relationship with the Owner or his Agent. This
allows the Tenant Rep to commit fully to achieving the objectives of
the Tenant.
Triple Net Lease (NNN)
A lease arrangement whereby the Tenant is obligated to pay for all
the operating expenses associated with their space. They would
have to contract individually for janitorial, electricity, insurance, and
repairs. This is used mainly for industrial properties, but is not often
seen in office buildings because many services overlap (i.e. there
is a central air system, central restrooms).
Usable Area
The square footage that the individual tenant can actually use
sometimes characterized as "carpetable" area.
Working Drawings
Architectural drawings required before a building permit can be
obtained and construction can commence. This typically includes
partition plans, HVAC plans and specifications, plumbing,
electrical, reflected ceiling, finish detail, etc.
Work letter
The landlord’s itemized schedule of specific labor and materials to
be provided in constructing the TI’s.
understanding of how these terms are understanding of how these
terms are understood in the industry. This is not a legal
interpretation and should not be relied upon. As a general rule,
there is no such thing as "standard" language and all parties should
ask for a further explanation if a term isn’t understood. If you don't
see a term here, feel free to contact us and we will be happy to
discuss it with you.
1031 Exchange
This is a provision of the tax code that allows the Seller of a
property to defer payment of certain taxes if they buy another
property or properties within a specified time frame. Because of
the implications, good tax and legal counsel is always
recommended.
Above-Standard Services
A multi-tenant building attempts to treat all tenants equally. This
includes charging them in an equitable manner. So all are charged
for standard services and those that have special needs are
charged separately for those services. This could include
electricity usage if they occupy their space beyond normal
business hours or have equipment which consumes an excessive
amount of electricity.
Above-Standard TI’s
Construction (tenant improvements) required by tenant over and
above that considered standard or typical in the building. These
items typically include wood or stone floors, crown molding,
cabinets, appliances, lighting other than the building standard
fluorescent fixtures, etc. These are described in detail in the work
letter of the lease and on the construction documents.
Add-On Factor
The percentage of difference between the Rentable Area and the
Usable Area divided by the Usable Area.
American with Disabilities Act (ADA)
Federal regulations intended to equalize access for people with
disabilities in buildings. New buildings must comply in order to
obtain their building permits. Lease spaces in existing buildings
must comply when substantially remodeled. Architects are
required by law in the State of Texas to send plans to the state if
the cost of remodeling is expected to exceed $50,000.
Amortization of TI’s
A method for the landlord to pay for above-standard TI’s and then
finance them by increasing the rental rate over all or a portion of the
term of the lease.
Assignment
The transfer of all obligations and rights of the lease or purchase
contract to another party. This is often used in an offer letter, so that
a Buyer would have the time to establish its final form of ownership,
such as an LLC. An assignment does not necessarily relieve the
assigning party of its obligation or liabilities. Confer with legal
counsel.
Attornment
Lease provision in which the tenant agrees, in advance, to accept
or pay rent to a new landlord or new owner. This is important if the
current landlord defaults on their mortgage.
Base Rent
The basic per-annum rental specified in the lease.
Base Year or Expense Stop
The expenses in a given year (usually the first year of the lease)
over which the tenant is responsible for operating expenses. For
example, if your base year is 2004 and the actual expenses in that
year were $7.75 per square foot (/SF), then that would be
considered your base year or expense stop for the remainder of
the lease. You would then be responsible for your prorated share
of any increase in subsequent years. If expenses go up to $8.50
/SF in 2005, you would be billed an extra $0.75/SF. That doesn’t
sound like much, but if you lease 5,000 SF, that means a bill for
$3,750. An expense stop is the same thing except that it is
typically stated in the lease as a specific number regardless of
what the actual expenses are in the first year of the lease.
Building Core
The vertical backbone of the building usually in the center of the
building including elevators, air shafts, restrooms, stairways,
mechanical and electrical rooms, etc.
Building Standard TI’s
The tenant improvements routinely offered to all prospective
tenants in a building. These are described in detail in the work
letter of the lease and on the construction documents.
Buyer’s Representative
A Licensed Real Estate Agent working solely for the Buyer, not the
Seller. Agency rules allow the Buyers Agent to receive a
commission from the Seller even though he does not represent the
Seller. Most Sellers have their own Sellers agents working to get
them the best price and terms. The parties to the transaction must
be informed ahead of the negotiations of this status.
CAP Rate
Abbreviation for Capitalization rate. This is basically the net
operating income (NOI) of the property divided by the purchase
price. It can be viewed as the rate of return an investor would
receive if the property was purchased with 100% cash. For
example, a $100,000 property being sold on a 10% cap means
that the NOI is $10,000.
Class A, B, or C
This refers to the quality of the building compared to the other
buildings in the submarket. This is determined by the market as a
whole and can vary from one submarket to another. The
determination is usually based on age, image, amenities, access,
etc. A building considered to be class A in the Stemmons
Freeway market might be considered class C if it were in the
central business district.
Commencement Date
A date which Landlord and Tenant agree the lease actually started.
This may be different than the occupancy date or rent
commencement date. Often, a commencement letter will be
signed by both parties once the date is determined. The
commencement date often determines when rent will commence
and acceptance of the property condition.
Common Areas
Portions of the building designated for the benefit of all tenants
such as lobbies, corridors, restrooms and mechanical areas.
Demising Walls
The walls which separate or demise the leased premises from
adjacent tenants.
Direct Pass-Through or Operating Expense Escalation
A formula through which the tenant is charged its prorated share of
increases in the building’s real estate taxes and/or operating
expenses over the base year or expense stop.
Dual Agent
Refers to a Licensed Real Estate Agent who claims to be
representing the best interests of both the Tenant and Landlord, or
both the Buyer and Seller.
Effective Annual Rent
The average rental rate of the total lease term after taking into
account any free rent or base rent steps.
Estoppel Certificate
A document signed by the Tenant that confirms they are the tenant,
confirms various terms of the lease, confirms that the lease is not in
default, and confirms the amount of rent and any security deposit
the Landlord is holding. It is usually required to be signed by the
Tenant when an owner sells or refinances the property.
Executive Suites
An operating business which leases a large space within a building
and then subleases individual offices to other companies. In
addition to the space, the subtenant has access to secretarial and
receptionist services, copies, fax, phone, conference room, break
room, etc. The rental rate per square foot is usually far higher than
a direct lease because of these additional services.
Expansion Option
The agreed-upon terms upon which a tenant has a right, but not an
obligation, to expand into specific additional space.
Expense Stop
A dollar amount usually stated as an amount per foot per year that
the Landlord agrees to pay for building expenses. If expenses of
the building exceed this amount, then the Tenant pays the amount
above the expense stop.
Full Service or Gross
A term which means that the rental rate includes all costs of
operating the building including heat, lights, air conditioning,
maintenance, management, security, landscaping, janitorial and
general operation of the property. There many modifications to this
including “plus E” meaning full service plus electric charges,
“industrial gross” meaning that the tenant pays electric and
janitorial separately, and “triple net” meaning that the tenant pays all
operating expenses on top of the base rent.
Guaranty
Signer (guarantor) assures Landlord that Tenant signing the lease
will pay the rent and, if not, the signer (guarantor) will be obligated
to fulfill the lease. This is used when the Tenant may be financially
weak or substantial tenant improvements are requested by the
Tenant. Guarantor can be a corporation or a person.
Gross Rent Multiplier
This term is typically only used with multi-family properties –
apartments. It is simply the purchase price divided by the gross
potential rent of the property. So a $4,000,000 purchase price with
gross potential rent of $750,000 would have a GRM of 5.33.
Gross Up
A technique used to adjust the operating expenses of a building to
a level that would exist if the building were fully occupied. This
allows for a more equitable calculation of the base year expenses
and subsequent years’ expense escalations payable by tenants.
HVAC
Heating, ventilating and air conditioning.
Holding Over
When a tenant continues to occupy the leased premises after the
lease has expired. It can occur with or without the landlord’s
consent. Leases usually state a holdover rent increase (i.e. 150-
200% of current rate) until the tenant vacates or renegotiates the
lease.
Indexed Escalation
An escalation formula that increases the rent each year by a fixed
or variable percentage.
Lease Commencement
The date on which the lease starts. This may be a different date
than tenant moves in or starts paying rent.
Leased Premises
The space which is leased to the tenant usually for its exclusive use
within the demising walls.
Lessee
The Tenant.
Lessor
The landlord or owner.
Letter of Intent
A document that outlines the general terms of a proposed lease or
purchase. It becomes the basis from which a formal lease or
purchase document is written. These are typically not binding
between the parties depending on language used.
Modified Gross Lease
As opposed to a full service lease, a modified gross lease requires
that the tenant pays some of the expenses directly – typically
electricity, janitorial and/or water. In comparing leases, it is
important to adjust for the differences in the lease rates.
Monument Sign
A large sign containing the names of one or more tenants that is
normally on the ground facing the street in front of the building, but
not attached to it.
Mullions
The metal posts between the exterior windows. Landlords typically
require that walls terminate on a mullion instead of in the middle of
a window.
Net Present Value
The current value of a future cash flow stream discounted at a given
rate.
Operating Expenses
Expenses related to the building and property including electricity,
water, gas, janitorial, parking lot sweeping, landscape
maintenance, building maintenance (except major renovations),
real estate taxes, insurance, and management fees. These items
should be detailed in the lease document in order to avoid
confusion.
Owner’s Agent
A licensed Real Estate agent working to get the best deal for the
Owner or Landlord frequently referred to as the Listing Agent.
Parking Ratio
The number of parking spaces divided by the total size of the
building. A ratio of 1:250 means there is one parking space for
every 250 square feet in the building. The lower the ratio, the more
parking spaces there are. Tenants need to be sure this resulting
number of spaces available to it will accommodate its employees
and visitors.
Pass-Throughs
This refers to operating expenses that are incurred on the property
that are passed through to the tenants. Contrasting this are those
expenses or costs that can not be passed through such as capital
improvements or major replacements.
Percentage Rent
This is typically only used for retail tenants. This is rent calculated
by applying a percentage stated in the lease to the tenant’s income
generated from that location.
Permitted Uses
The uses or activities allowed to be performed in the leased
premises. This becomes particularly important if zoning is in
question or if Tenant plans to sublease its space.
Phase One Study
A review of the current and historical environmental condition of a
property. Owners typically have a Phase One done prior to
purchasing a property. Large tenants occasionally require them.
And lenders usually want one done before they will either lend on or
foreclose on a property.
Preliminary Title Report
Generated by a title company as a review of liens, encumbrances,
ownership, and taxes on a property. This is normally done in
preparation for a sale transaction.
Pro-rata Share
An amount calculated by dividing the square footage of the tenant’s
space by the entire building size. A 1,000 SF tenant would have a
10% pro-rata share of a 10,000 SF building.
Real Estate Tax
This is the property tax paid to the county, city, school district, etc.
This is paid once a year between October 1 and January 31 to
avoid interest and penalties. The lease should require that the
landlord protest the assessed value annually to ensure the taxes
are always as low as possible. Reserved usually means the Tenant
is paying for it, whether per space or as part of the lease.
Recapture
The right of the landlord to void a tenant’s lease for all, or a portion,
of the premises in order to prevent a sublease or assignment.
Renewal Option
A lease clause specifying the terms and conditions under which the
tenant may extend the lease term without obligating the tenant to do
so.
Rent Abatement or Free Rent
A period of time during which the tenant is not charged rent for
space under lease.
Rent Commencement
The date upon which the tenant is obligated to begin paying rent.
Rent Steps
Agreed-upon increases in the Base Rent that take effect at
specified dates during the term of the lease.
Rentable Area
The square footage used to calculate Base Rent. It is the Usable
Area that a tenant actually occupies plus a percentage of common
areas.
Sublease
An agreement whereby a tenant finds another tenant to occupy all
or a portion of the leased premises. This is often done when a
tenant closes an office or outgrows its space. It is important to
include the appropriate language in the lease when first signed to
give the primary tenant the right to sublease if that ever becomes
necessary. It does not normally release the primary tenant or their
guarantors from the lease obligations. The landlord must consent.
Sublease Premium
The amount by which rent paid on a sublease exceeds that paid on
the underlying lease. Leases generally state that any premium
must be paid to the landlord, but a split can often be negotiated.
Security Deposit
Money collected at the execution of the lease to provide additional
confidence the Tenant will perform. It is not normally the last months
rent, but is typically equal to that amount. Landlords will require the
deposit be increased as their risk increases. Letters of credit can
often be used in lieu of cash deposits.
Submetered Electric
A separate charge for electricity shown on a submeter monitoring
the actual consumption of a large computer room, piece of
equipment or machinery.
Tenant Improvement Allowance
A dollar amount provided by the landlord for the construction in the
leased premises to make it ready for tenant’s occupancy.
Tenant Improvements (TI’s) or Build-out
Interior construction necessary to customize the space for
occupancy by the tenant.
Tenant Representative
A Licensed Real Estate Agent working for the best interests of the
Tenant, not the Landlord. They usually don't have a listing
agreement or agency relationship with the Owner or his Agent. This
allows the Tenant Rep to commit fully to achieving the objectives of
the Tenant.
Triple Net Lease (NNN)
A lease arrangement whereby the Tenant is obligated to pay for all
the operating expenses associated with their space. They would
have to contract individually for janitorial, electricity, insurance, and
repairs. This is used mainly for industrial properties, but is not often
seen in office buildings because many services overlap (i.e. there
is a central air system, central restrooms).
Usable Area
The square footage that the individual tenant can actually use
sometimes characterized as "carpetable" area.
Working Drawings
Architectural drawings required before a building permit can be
obtained and construction can commence. This typically includes
partition plans, HVAC plans and specifications, plumbing,
electrical, reflected ceiling, finish detail, etc.
Work letter
The landlord’s itemized schedule of specific labor and materials to
be provided in constructing the TI’s.