| J.F.W. REALTY | | Commercial Brokerage |
| | Specializing in Manhattan Properties |
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| Agent. One who acts or who has power to act for another. A licensed real estate broker authorized to act under a listing or management agreement executed by a property owner (the Principal); this creates a fiduciary relationship under the law of agency
Amortization. The process of paying off a debt together with interest, usually with equal payments at regular intervals over a period of time.
Appraisal. A written report by a state-licensed professional that includes an unbiased analysis of the property's value and the reasoning that led to that opinion. An appraisal report is required for any property sale.
Assignment. The transfer in writing of an interest in a lease, mortgage or other instrument. The assignor, or lessee, transfers the entire remainder of the term created by the lease, and the assignee becomes liable to the original lessor for rent. Assignor may or may not retain secondary liability for performance under the lease, depending upon the terms of the lease pertaining to assignment
Base year. 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.
Broker. An agent who brings together a buyer and a seller, or a landord and a tenant, in a real estate transaction. All brokers must be lisenced by the state in which they work. Most work on commission, and the landlord or seller usually pays the fee.
Building standard. 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 fitting up charges and/or allowances. Such items may be changed only with the approval of the building owner or the managing representative.
Build Out
The construction or improvements of the interior of a space, including flooring, walls, finished plumbing, electrical work, etc.
Build-to-suit. A method of leasing property in which the landlord makes improvements to a space based on the tenant's specifications. Most build-to-suit provisions apply to long term (10 Years) leases.
Burndown. This is when a tenant remains in good standing and is asking to have security returned. This ususlly occurs over a period of years. This is established at the time of lease negotiations.
Certificate of insurance. 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.
Class A Building classification system; defined by BOMA as the most prestigious buildings competing for premier office users with above average rental rates for the area along with high-quality standard finishes, state of the art systems, exceptional accessibility and a definite market presence.
Class B Building classification; defined by BOMA as buildings competing for a wide range of users with rents in the average range for the area. Building finishes are fair to good for the area and the systems are adequate, but the building does not compete with Class A at the same price.
Class C Building classification; defined by BOMA as buildings competing for tenants requiring functional space at rents below the average for the area.
Common areas. Areas used by two or more tenants and/or third parties and not under the control of any one tenant
Concessions. Benefits or discounts given by the seller or landlord of a property to help close a sale or lease. Common concessions include absorption of moving expenses, remodeling of space or upgrades, and reduced rent for the initial term of the lease.
Construction allowance. The amount a Landlord contributes to the cost of construction and/or alteration necessary to prepare a space for a tenant's occupancy. This is usually an established amount, but is negotiable.
Construction cost. Total expense, plus normal overhead and profit, that must be paid for the job in question
Default. Failure to meet an obligation when due or to perform any provision of a lease, mortgage or other agreement.
Demised premises. Premises, or parts of real estate, in which an interest or estate has been transferred temporarily, such as an interest in real property conveyed in a lease.
Demolition clause. A clause within a lease denoting the fact that if or when the ground lease has expired, the building will be demolished per such clause. The lessor must notify the tenants within an established time of such condition
Escalation clause. A clause in a lease that allows the landlord to increase rent in the future. Rent increases dictated under an escallation clause may be charged in multiple ways.
1. Fixed rate.. Fixed at time of lease
2. Direct Operating- (Variable) A cost directly related to the landlords cost of
operating his building.
3. Cost of Living-(Variable) Tied directly to some type of government index.
C.P.I. etc.
Electric Cost. The cost to the tenant for use of his space. This number is based upon rentable square footage.
1. Fixed rate. A rate which will be a fixed number per month. Based upon sq/f
times a dollar rate per sq/ft.
2. Direct electric. Tenant pays for exactly what a meter reading states.
3. Submetered electric. A tenant pays for a meter reading with a small handling
charge for reading the meter. Usually between 10-15% (Negotiable).
Fiduciary. A person to whom power or property is entrusted for the benefit of another
Fixture. 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.
Footprint. The shape and configuration of a building.
Hard construction costs. The costs of constructing a building shell plus most of the covering materials
Holdover Tenant.A tenant who remains in possession of leased property after the lease term expiration
HVAC. An acronym for "heating -ventilation-air-conditioning" system.
The lanldord may or may not be responsible for mainainance of A/C.
Interior partitions. All types of interior nonload-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.
Landlord.One who rents property to a tenant.
Lease. An agreement by whichthe owner of a property (lessor)
grants the right of possession to a tenant (lessee) for a specific period of time(term) for a predetermined amount of money (rent)
Leasehold. The interest or estate that a lessee of real estate holds under the provisions of a lease.
Lessee. The tenant in a lease.
Lessor. The landlord in a lease.
Letter of Intent
An informal, usually non-binding, agreement among parties indicating their serious desire to move forward with negotiations.
Listing.An employment contract between principal and agent that authorizes the agent (such as a broker) to perform services for the principal and his property.
License. Permission given by the landlord for a person to enter the premises of a tenant for a particular purpose. A license is of temporary character, purely a personal right, and cannot be sold. It is revocable.
Loss Factor.What percentage of the gross area of a space is lost due to walls, elevator, etc
Market Price.The actual selling or leasing price of a property.
Market Value.The expected price that a property should bring if exposed for lease in the open market for a reasonable period of time and with market savvy landlords and tenants.
Month-to-month tenancy. 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.
Non-Disturbance Agreement.The tenant signs this to prevent himself from being evicted if the property owner does not pay its mortgage to the bank.
Option. A contractual agreement giving one party a privilege of demanding, within a specified time, the carrying out of a transaction upon stipulated terms.
Pass-through. Expenses or a portion of expenses associated with tenancy that are "passed through" from the landlord to the tenant who then pays them.
Prime tenant. A tenant who occupies a great portion of the space available within a given building that may, in addition, be owned by that tenant.
Principal. (1) A sum lent or employed as a fund or investment, as distinguished from its income or profits; (2) the original amount (as of a loan) of the total due and payable at a certain date; (3) a party to a transaction, as distinguished from an agent.
Principal and agent. The relation created by express or implied contract or by law whereby one party delegates the transaction of some lawful business, with more or less discretionary power, to another who undertakes to manage the affair and render an account thereof.
Procuring cause. A broker will be regarded as the 'procuring cause' of a sale, so as to be entitled to commission, if his efforts are the foundation on which the negotiations resulting in a sale are begun" Coles versus Pattison, 189 Okl. 160, 114 P. 2d 457, 458.
Punch list. A list prepared by the architect, designer and owner and formally submitted to the contractor to note any deficiencies when the check all completed construction, which assures verification that such work has been accomplished in a good, workmanlike manner in respect to the contract documents.
Quiet enjoyment. 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.
Realtor.A coined word which may only be used by an active member of a local real estate board, affiliated with the National Association of Real Estate Boards.
Real Estate Board.An organization whose members consist primarily of real estate professionals such as brokers.
Real Estate Broker. Any person, copartnership, association or corporation who, for a compensation or valuable consideration, sells or offers for sale, buys or offers to buy, or negotiates the purchase, sale, or exchange of real estate, or who leases or offers to lease or rents or offers for rent any real estate or the improvements thereon for others. Such a broker must secure a state license. For a license to be issued to a firm, it is usually required that all active partners and officers must be licensed real estate brokers.
Real Estate Salesperson. Any person who, for a compensation or valuable consideration, is employed either directly or indirectly by a real estate broker to sell or offer to sell, or buy or offer to buy or negotiate the purchase, sale or exchange of real estate or to lease, rent or offer for rent any real estate or to negotiate leases thereof or the improvements thereon.
Real Estate Syndicate
When partners (either with or without unlimited liability) form a partnership to participate in a real estate venture.
Real Property.Land and any capital improvements (e.g., buildings) erected on the property.
Recapture. 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.
Rent.Compensation from tenant to landlord for the use of real estate.
Rentable area. The generally accepted means of measuring space within an office building is the Building Owners and Managers association (BOMA) standard. From the inside of the outside wall (or in new buildings from the glass line) to the outside of the inside wall (or hall wall) and center to center on the division walls. Columns are included.
Replacement cost. The current cost of replacing the subject property with property having exactly the same utility and amenities.
Rules and Regulations. 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.
Security. Monies given the landlord to establish a comfort level inorder to consumate the transaction. This is variable and is based upon the financial strength of the tenant, length that tenant has been in business, and work to be done by landlord. A tenant may ask for a "Burndown of Security" or monies returned yearly as tenant remains in good standing.
Subagent.An agent of an individual already acting as an agent of a principal.
Sublease. A lease given by a tenant for some or all of his rented property. This clause must be in the origional lease, with the landlord not to unreasonable withhold this right. Tenant still has primary obligation to the landlord..
Subordination. An agreement by which a lien holder, a lessee or one having an interest or claim in or against personal or real property places the interest behind that of another.
Surrender. The cancellation of a lease by the mutual consent of the tenant and the landlord
Tenant representation agreement. A contract under which a client agrees to work through no salesperson except the one designated in the agreement.
Tenant Improvements.Work done on the interior of a space, can be paid for by landlord, tenant, or some combination of both, depending on the terms of the lease.
Usable area. Any area in a given floor that could be used by the tenant. This area includes a point from the perimeter glass line to demising walls; it also includes column areas within such a space
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| © 2003 J.F.W. REALTY. All Rights Reserved. |
