Subordination, Non-Disturbance and Attornment Agreements in Commercial Leasing and Real Estate Finance
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Gain an understanding of the objectives of an SNDA and the practical tips for drafting and negotiating them.This topic presents an overview of the Subordination, Non-Disturbance and Attornment Agreement (SNDA) and how to prepare one. Many lenders require SNDAs as a condition to the closing of a mortgage loan, and tenants are frequently asked by their landlords to sign SNDAs. Some tenants insist on obtaining an SNDA prior to entering into a lease. You will learn why SNDAs are important, the key elements of an SNDA, and how an SNDA is like a prenuptial agreement for two parties who do not want or intend to get married. The information will consider both lender and tenant objectives for an SNDA and will present practical tips for drafting and negotiating an SNDA.
AuthorsRonald S. Gart, Seyfarth Shaw LLP James O'Brien, Seyfarth Shaw LLP
Overview of the Subordination, Non-Disturbance and Attornment Agreement (SNDA)
• What Is an SNDA?
• When Do You Need It?
• What Happens If You Do Not Have One?
• Why Does a Lender Want an SNDA?
• What Is a Lender Trying to Accomplish in an SNDA?
• Why Does a Tenant Want an SNDA?
• What Is a Tenant Trying to Accomplish in an SNDA?
Drafting an SNDA
• Key Elements
- Lender Protections and Lease Amendments
• Relationship to Loan Documents and Lease
• Standard Forms
Negotiating an SNDA
• Accomplishing Lender Goals
• Accomplishing Tenant Goals
• Reasonable Compromise Positions