FAQ & Knowledge Base

A security that represents ownership in a non-U.S. company and trades on a U.S. exchange.

The rate at which rentable space is leased or occupied within a market.

A document that modifies or changes a legal agreement

The largest and usually the most prominent tenant in a shopping center, office building, or other commercial property.

The total amount of rent payable by a tenant over a year.

The transfer of a lease or other agreement from one party to another.

The minimum rent payable by a tenant before any additional rent, such as taxes, operating expenses, or percentage rent.

A classification system for commercial buildings based on factors such as age, location, and amenities.

The construction or renovation of interior space to meet the specific needs of a tenant.

A payment made by a tenant to terminate a lease or to take control of a space before the end of the lease term.

The portion of operating expenses for a commercial property that is paid by tenants, typically for maintenance and repair of common areas.

Yes, you can be evicted from a leased property if you violate the terms of your lease agreement or if you fail to pay rent.

It depends on what’s mentioned in the lease agreement. Many lease agreements will include specific language about what changes are allowed and what the process is for making those changes.

If your lease agreement does not prohibit subletting and you have the landlord's permission, you can sublet your property.

Yes, a landlord can charge a tenant for damages to the leased property, but only if the damages were caused by the tenant or their guests and were not due to normal wear and tear.

It would depend on the rent agreement. But in some states and jurisdictions, rent control laws may limit the amount by which a landlord can increase the rent or may prohibit rent increases during the term of a lease.

A lease can be terminated early under the following circumstances: (A) Mutual agreement (B) Breach of a lease contract (C) Landlord's breach of the lease agreement (D) Military deployment or relocation (E) If there’s any kind of violence

A lease can be transferred to another person under certain circumstances. This is called subletting or assignment.

The rate of return used to determine the value of income-producing property. It is calculated by dividing the property's net operating income by its value or purchase price.

A document issued by a government agency indicating that a building or space is suitable for occupancy.

A classification system used to rank buildings based on their age, location, amenities, and quality of construction. Class A buildings are typically the newest and highest quality, while Class C buildings are older and less desirable.

Real estate used for business purposes, such as office buildings, shopping centers, and industrial facilities.

Property used for business purposes, such as offices, retail stores, and industrial buildings.

The parts of a commercial property that are shared by multiple tenants, such as lobbies, hallways, and parking lots.

Two or more spaces that are adjacent and can be combined into one larger space.

A condition or event that must occur before a contract or agreement becomes binding.

These are lease payments that are dependent on future events, such as sales or usage levels. Under both IFRS 16 and ASC 842, lessees are required to estimate and include the expected amount of contingent rentals in the calculation of the lease liability.

The percentage of common areas, such as lobbies, hallways, and restrooms, that are deducted from a tenant's usable square footage to calculate their rentable square footage.

Failure to fulfil a legal obligation, such as paying rent or performing under a contract.

Money paid by a tenant as security for performance of obligations under a lease or other agreement.

This refers to the periodic allocation of the cost of the right-of-use (ROU) asset over its useful life. Under both IFRS 16 and ASC 842, lessees are required to recognize ROU assets and lease liabilities for most leases. Depreciation of ROU assets is one of the key expenses that lessees need to account for under the new lease accounting standards.

A lease in which the tenant is responsible for paying rent and property taxes.

The process of investigating a property or other investment before entering into a transaction.

The right to use or access a portion of a property owned by another party, such as a right-of-way for utilities.

A provision in a lease or other agreement that allows for an increase in rent or other charges based on certain factors, such as inflation or operating expenses.

A document signed by a tenant certifying the terms and conditions of a lease.

Moveable property such as office furniture, kitchen appliances, and other items that are not part of the building structure.

A lease in which the landlord is responsible for all operating expenses of a property, including taxes, insurance, and maintenance.

A lease in which the tenant pays a fixed amount of rent that includes all operating expenses, such as taxes and maintenance.

The total square footage of a building or space, including common areas and other non-rentable space.

The formula for calculating the present value is: PV = Lease payments / (1 + r)^n Where, PV = Present value of the lease payments, r = Discount rate, n = Number of lease payments.

To dispute a charge, first review your lease agreement and any supporting documentation to ensure the charge is valid. If you believe the charge is incalid or that there has been an error, contact your landlord or property manager in writing, explaining the issue and providing any relevant documentation.

Talk to your landlord in advance to discuss the possibility of an extension. This will give them enough time to make arrangements for any needed repairs or improvements to the property.

Your lease agreement will have the terms related to the security deposit refund. But if there’s any dispute, here are two steps you can take: (1) Consult a lawyer to understand your rights as a tenant (2) File a complaint with the relevant authority

Here’s what you can do: (1) Document the issue (2) Communicate with the landlord (3) Consider withholding rent (4) Seek legal advice

Here’s what you can do: (1)Review the lease agreement (2)Send a demand letter asking to return the deposit (3)File a complaint (4)Seek legal advice

Here are a few steps you can take: (1) Document the issue (2) Contact your landlord (3) Send a formal complaint (4) Consider withholding rent (5) Consult a lawyer on the issue

Review the notice of eviction or lease termination to ensure that it is valid and that the landlord has followed the proper procedures. After this you can: (1) Seek legal advice (2) Start looking for alternative housing options as soon as possible (3) Talk to your landlord in case he’s willing to negotiate on the lease. (4) Prepare to move out if the eviction is final.

Here’s how you can determine that: (1) Reviewing the rental agreement and local laws (2) Checking for required disclosures (3) Inspecting the property (4) Researching the landlord's history (5) Contacting local housing authorities

Your lease agreement should state who is responsible for insurance on the leased property. But typically, landlords are responsible for insuring the physical structure of the building and any common areas, such as hallways or laundry rooms

The lease agreement will typically specify who is responsible for paying the utility bills.

To request maintenance or repairs on a leased property, you should first contact your landlord or property manager. They will typically have a process in place for handling maintenance requests.

IFRS 16 has increased the complexity and cost of lease accounting and management, but it is expected that it will provide a more accurate and transparent picture of a company's lease obligations and the assets that they are using to support those obligations.

It could take anywhere from a couple of weeks to a couple of months to renew a lease. This is because the landlord has to offer a 30-90 days notice period.

It's commonly between 30-60 days. It’d be specified in the lease agreement. If not, it’d depend on the jurisdiction.

To protect or compensate a party for any loss or damage incurred as a result of a particular action or event.

These are the costs incurred by a lessee to obtain a lease, such as legal fees or broker fees. Under both IFRS 16 and ASC 842, initial direct costs are capitalized and amortized over the lease term.

A document indicating that a tenant has obtained insurance coverage as required by a lease or other agreement.

This refers to the interest expense incurred by the lessee on the lease liability. Under both IFRS 16 and ASC 842, lessees are required to recognize interest expense on the lease liability separately from the depreciation of the ROU asset.

A practical expedient that allows lessees to elect not to apply the lease accounting requirements to certain land easements that are not physically distinct or have insignificant value.

The owner of a property who leases the property to a tenant.

A legal agreement between a landlord and tenant that governs the terms and conditions

The date on which a lessee begins to use an identified asset under a lease arrangement.

An identified asset or group of assets in a lease arrangement that is accounted for separately from other components of the lease.

Factors that indicate that the carrying value of a lease asset or liability may not be recoverable, such as a significant change in circumstances or the occurrence of a significant event.

Payments or other benefits provided by a lessor to a lessee as an inducement to enter into or extend a lease arrangement.

The present value of lease payments that a lessee is obligated to make under a lease arrangement.

A change in the terms or conditions of a lease arrangement that was not part of the original agreement.

The consideration that a lessee is required to pay to a lessor under a lease arrangement, including fixed payments, variable payments, and lease incentives.

The amount that a lessor is entitled to receive from a lessee under a lease arrangement.

The period of time for which a lessee has the right to use an identified asset under a lease arrangement.

The early termination of a lease arrangement by either the lessor or lessee.

This refers to the expenses incurred by lessees related to their lease arrangements. Under both IFRS 16 and ASC 842, lease expenses include depreciation of the ROU asset, interest on the lease liability, and any other lease-related expenses, such as variable lease payments or contingent rentals.

This refers to the revenue earned by lessors from leasing out assets to lessees. Under both IFRS 16 and ASC 842, lessors are required to recognize lease revenue over the lease term, either on a straight-line basis or based on the pattern of the lessee's use of the leased asset.

This section of the ASC 842 standard provides guidance on the accounting treatment of leases with bargain purchase options, which allow the lessee to purchase the leased asset at a price significantly below its fair value.

A business entity that is recognized as a separate legal entity under applicable laws and regulations.

The party that obtains the right to use an identified asset under a lease arrangement.

The party that grants the right to use an identified asset to a lessee under a lease arrangement.

A reassessment by a lessor of the lease term of a lease arrangement, which may result in a remeasurement of the lease liability.

This section of the ASC 842 standard provides guidance on the lessor accounting for different types of leases, including sales-type leases, direct financing leases, and operating leases.

A lease arrangement in which the lessor borrows funds to finance the acquisition of the leased asset.

These are assets with a low cost, such as office equipment or small tools, that are exempt from the recognition requirements of the new lease accounting standards. Under IFRS 16, low-value assets are defined as those with a cost of up to $5,000, while under ASC 842, they are defined as those with a cost of up to $5,000 or less.

Buyers and sellers in a market for the same or similar assets or liabilities.

A lease in which the tenant pays for some or all operating expenses, such as utilities, maintenance, and property taxes, in addition to rent.

A component of a lease arrangement that is not an identified asset and does not give rise to a lease liability.

An element of a lease arrangement that is not an identified asset or group of assets.

A period of time during which a lessee has the right to terminate a lease arrangement without penalty.

A practical expedient that allows lessees to elect to combine certain lease arrangements into a single lease for accounting purposes.

This refers to the assessment of whether the leased asset or the ROU asset has become impaired, which means that its value has decreased significantly. Under both IFRS 16 and ASC 842, lessees are required to test for impairment of the ROU asset and the underlying asset, if applicable, when there is an indication of impairment.

An option granted to a lessee to purchase the underlying asset at the end of the lease term.

The implicit interest rate used in lease accounting to determine the present value of lease payments.

A level of confidence or probability that an event will occur or a condition exists, which is greater than 50%.

The reassessment of the lease term and purchase options when there is a significant change in circumstances or events that affect the lease arrangement.

This refers to the adjustment of the lease liability and ROU asset when there is a change in the lease term, lease payments, or discount rate. Under both IFRS 16 and ASC 842, lessees are required to remeasure their lease liabilities and ROU assets when there is a significant change in the lease terms.

An event or condition that has a low probability of occurring

A guarantee by the lessee or a third party that the underlying asset will have a certain value at the end of the lease term.

The lessee's ability to direct the use of the identified asset throughout the lease term.

The lessor's ability to direct the use of the identified asset throughout the lease term.

The lessee's right to obtain substantially all of the economic benefits from the use of the identified asset throughout the lease term.

An asset that represents a lessee's right to use an identified asset for the lease term.