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Abstracting a lease with its amendments: what to watch
A commercial lease is often more than one document. Over the years it picks up amendments, riders and side letters, and each one changes some terms and leaves the rest alone. The abstract has to show the lease as all of them leave it today.
Checking it takes real work. Every term on the abstract has to be traced through every document that could have changed it, in the order they were signed. Miss one amendment and every term it changed is wrong, and nothing on the abstract shows it. By hand, that means reading each amendment against the lease, clause by clause.
What amendments usually change
- The term: an extension, a new expiration date, sometimes a new commencement date.
- The rent: a new schedule, a cut to keep the tenant, or free rent in return for an extension.
- The space: a suite added or given back, so the area, the share of expenses and the rent all change.
- The base year for expenses, often set anew for added space.
- Options and rights: a renewal used up or added, a termination right added or deleted.
- The parties and the notice addresses: a new landlord after a sale, a tenant’s new name, an address that moved.
What goes wrong
- The lease is read as signed. The abstract is right for a lease that no longer exists.
- The amendments are read out of order. An older amendment’s rent overwrites a newer one’s.
- A deletion is missed. “Section 34 is deleted in its entirety,” and the right in Section 34 stays on the abstract.
- A document is missing. An amendment refers to an earlier one that isn’t in the files, and whatever it changed is missing too.
- Dates are counted from the old term. Notice windows are worked out from an expiration an amendment extended.
How to keep the abstract right
- Put the documents in signing order first, by the date each one was signed, not by its file name.
- Read each amendment’s opening paragraphs. They often list the documents before it. If one is listed that you don’t have, ask for it before you abstract.
- Note where each term was last set: the document, the page and the section.
- Read what each amendment deletes as carefully as what it adds.
- Work every date out again from the latest expiration and the lease’s own words.
When a missing amendment turns up
Put it in its place by date, and see what moves. Every term it changed may be different now, and so may any term a later document changed after it. Dates worked out from the term are the first to check.