SNDA (Subordination, Non-Disturbance, and Attornment)

Category: legal

An agreement protecting both the tenant and the lender if the commercial landlord defaults on their mortgage.

The SNDA is a three-way peace treaty. "Subordination": Tenant agrees the bank’s mortgage is more important than their lease. "Non-Disturbance": Bank promises not to evict the paying tenant if they foreclose. "Attornment": Tenant promises to pay rent to the bank if the landlord goes bankrupt.

Common Examples

• The national retailer refused to sign the lease until the landlord’s bank provided a fully executed SNDA agreement.
• An SNDA is critical for commercial tenants who have invested millions in TI and cannot afford to be evicted by a landlord’s foreclosure.