Preventing An Insecurity Complex: What To Do Before Your Landlord Goes Under

Copyright 2009, Blake, Cassels & Graydon LLP

Originally published in Blakes Bulletin on Real Estate, April 2009

In economic downturns, talk in the commercial leasing industry inevitably turns to what to do with shaky tenants and how to best protect the position of the landlord. However, tenants and subtenants should not assume that the headaches are all on their landlord and sublandlord's side – tenants and subtenants are increasingly finding themselves left out in the cold, figuratively and literally, when their landlord or sublandlord face financial difficulties.

Securing Possession: Get That NDA!

When times were good, tenants would often negotiate for the provision of a non-disturbance agreement (NDA) from the landlord's lender, but would never actually press their landlord to obtain it. Unfortunately for the tenant, without an NDA and where a lender's security is in priority to the lease, the lender is not bound to the lease and can force out a tenant