Industrial / Warehouse Lease

Industrial / Warehouse Lease

Drafts a litigation-tested, NNN-structured Industrial or Warehouse Lease tailored to transaction-specific details.

Quick Start

Gather before drafting:

1. Parties — legal names, entity types, addresses (Landlord and Tenant)
2. Premises — address, RSF (warehouse + office split), building/suite, legal description
3. Appurtenant rights — loading docks (count, exclusive vs. shared), truck court, parking, yard
4. Economics — base rent, escalation (fixed %, CPI, or FMV reset), commencement, abatement
5. Term — commencement trigger (execution, delivery, TI completion), expiration
6. Permitted use — Tenant's specific operations
7. Jurisdiction — state where property is located

Article Structure

Insurance Requirements

Policy standards: A.M. Best ≥ A-VII; 30-day cancellation notice; certificates before possession and annually.

Default & Remedies

LL remedies: termination, re-entry, acceleration, damages, specific performance, self-help with cost recovery. Monetary default: late charge + interest from due date.

Casualty & Condemnation

Award: LL receives entire award; Tenant claims separately for personal property, trade fixtures, and relocation (must not reduce LL's award).

Defined Terms

Use consistently throughout:

• Base Rent — monthly fixed rent (Art. 3)
• Operating Expenses — NNN pass-throughs (taxes, insurance, CAM, mgmt fees); exclude initial construction, leasing commissions, other-tenant costs
• Premises — demised space (Art. 1)
• Hazardous Materials — substances regulated under federal, state, or local environmental law
• Tenant's Proportionate Share — Premises RSF ÷ Building RSF (100% if single-tenant)
• Permitted Use — as specified by client

Pitfalls & Checks

• NNN default: Industrial leases are presumptively NNN; flag clearly if gross or modified gross
• Environmental: Heighten scrutiny for manufacturing/chemical-storage tenants; consider environmental insurance or periodic Phase II assessments
• Lien law: Mechanics' lien statutes vary by state — tailor lien waiver and bonding to jurisdiction [VERIFY state-specific requirements]
• Dock equipment: Specify whether levelers, seals, and overhead doors are LL or Tenant property; clarify repair responsibility
• SNDA: Never subordinate without non-disturbance protection; confirm lender's preferred form
• Exhibits: Attach Exhibit A (legal description/site plan), Exhibit B (rules and regulations), Exhibit C (SNDA/estoppel form)
• Jurisdiction: Confirm compliance with state LL-T statutes, local zoning, and municipal industrial-operations requirements