Agreements for Lease (AFLs) are critical instruments in the delivery of purpose-built facilities, particularly in retail and commercial developments where tenant requirements shape the design and construction process. Unlike standard leasing arrangements, AFLs sit at the intersection of development risk, construction delivery and leasing outcomes.
This article outlines the key provisions found in AFLs, examines the allocation of risk between landlord and tenant, and highlights common issues relating to extensions of time, sunset dates, liquidated damages, and financier involvement.
Typical Agreement for Lease provisions
A well-structured AFL establishes the commercial and legal framework for the delivery of the premises and the subsequent lease. Key provisions typically include: