Subordination, Non-Disturbance, and Attornment Agreement (SNDA) Toolkit

by Practical Law Real Estate

Resources for lenders, landlords, and tenants to assist with negotiating Subordination, Non-Disturbance, and Attornment Agreements (SNDAs). This Toolkit explains the key components of these three-party agreements, which are routinely required in commercial real estate transactions. It outlines the purpose of an SNDA, which is to establish the priority of the lender's mortgage lien over the tenant's leasehold interest and to define the parties' rights and obligations in the event of a landlord default or foreclosure. The resources clarify how a tenant subordinates its lease in exchange for the lender's agreement not to disturb the tenancy if it forecloses on the property. This Toolkit also describes a tenant’s obligation to attorn to, or recognize, the lender as its new landlord following foreclosure. It includes both jurisdictionally-neutral guidance and state-specific forms for various jurisdictions, including California, Florida, Illinois, New York, Texas, New Jersey, Massachusetts, and Pennsylvania, that can be adapted for different commercial real estate financing transactions.