industrial-warehouse-lease

name	industrial-warehouse-lease
language	en
description	Drafts NNN-structured U.S. Industrial or Warehouse Lease agreements. Covers base rent escalations, operating expense pass-throughs, hazardous materials compliance, loading dock rights, SNDA provisions, and casualty/condemnation procedures. Use when drafting leases for industrial parks, warehouses, distribution centers, light manufacturing, or R&D facilities.

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

#	Article	Key Points
1	Parties & Premises	Legal names; RSF breakdown; appurtenant rights; park relationship
2	Term	Commencement trigger; expiration; option periods
3	Base Rent & Escalations	Monthly amounts; due 1st; escalation mechanism; conditional abatement
4	Lease Type & OpEx	NNN designation; inclusions/exclusions; allocation method; annual reconciliation
5	Utilities	Direct metering; Tenant contracts directly; no abatement except LL negligence
6	Permitted Use	Broad for operations; prohibit nuisance/zoning violations/insurance increases
7	Maintenance & Repair	Tenant maintains all: roof, structure, HVAC, plumbing, electrical, fire suppression, docks, parking
8	Environmental	Hazmat prohibition with de minimis carve-out; Tenant indemnity; spill notice; remediation at Tenant cost
9	Loading Docks & Truck Court	Dock count/exclusivity; delivery hours; idling limits; equipment maintenance; trailer storage
10	Alterations	Cosmetic vs. structural threshold; plan approval; lien waiver; removal election
11	Insurance	See Insurance table below
12	Assignment & Subletting	Consent not unreasonably withheld; recapture right; affiliate exception; Tenant remains liable
13	Default & Remedies	See Default table below
14	Casualty & Condemnation	See Casualty table below
15	SNDA	Subordinate to mortgage; lender-form SNDA; non-disturbance condition; Tenant notice of LL defaults
16	General Provisions	Notices; governing law (property state); severability; integration; no oral modification; prevailing-party fees
17	Signatures	Entity name; signatory name/title; date; notarization if required

Insurance Requirements

Coverage	Minimum	Notes
CGL	$1M occ / $2M agg	LL + LL's lender as additional insureds
Property (all-risk)	Full replacement of Tenant FF&E + TIs	—
Workers' Comp	Statutory	If Tenant has employees
Umbrella	As warranted	Recommend for heavy industrial
Business Interruption	As warranted	Optional
Auto Liability	As warranted	Optional; fleet operations

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

Default & Remedies

Type	Notice	Cure Period
Monetary (rent, OpEx)	Written	5–10 days
Non-monetary breach	Written	30 days (extendable if diligent)
Bankruptcy / insolvency	None	Immediate
Abandonment	None	Immediate

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

Casualty & Condemnation

Event	Threshold	Election Period	Rent Abatement
Minor casualty	LL must repair	N/A	Proportionate
Substantial casualty	Either may terminate	30–60 days	Proportionate; full if total
Partial condemnation	<25–50% floor area	N/A; continues	Proportionate
Substantial condemnation	≥25–50% floor area	Either may terminate	Full

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