Non-Disturbance Agreement — tenant protection when a property changes hands

Answer

Intro: A non-disturbance agreement (often part of a SNDA: Subordination, Non-Disturbance & Attornment) is a contract that protects a tenant’s right to stay in a leased space if the landlord’s lender forecloses or a new owner takes control. In simple terms, it tells the lender: “If you foreclose, don’t kick this tenant out — the tenant can keep occupying under the lease as long as they comply with its terms.”

Main points:

• Who signs it? Typically the tenant, the landlord (or seller), and the lender (or purchaser). The lender agrees not to disturb the tenant’s possession so long as the tenant continues to perform under the lease.
• Why it matters: Without a non-disturbance clause, a foreclosure can terminate a lease that is subordinated to a mortgage. Tenants in retail, office, and industrial leases rely on NDAs to secure business continuity and protect investments (tenant improvements, fixtures, goodwill).
• Common conditions: Lenders usually require the tenant’s lease to be subordinated to the mortgage; in exchange the lender issues a non-disturbance promise. The tenant often must agree to attorn (recognize the lender or purchaser as the new landlord) and keep paying rent and performing lease obligations.
• Key negotiation points: Ask for a broad non-disturbance that survives foreclosure, a clear definition of “default” by the tenant, a reasonable cure period for landlord defaults, and confirmation that the agreement is binding on successors and recordable if needed.
• Practical steps: Request an NDA early — at lease negotiation or before closing — and obtain any required estoppel certificates. Keep copies and verify whether the agreement will be recorded or delivered to the tenant.

Risks & limits: Non-disturbance protections vary by lease type and market; lenders may limit scope or condition the NDA on strict tenant performance. Residential tenants sometimes receive different protections under local law. Because wording determines how strong the protection is, ambiguous language can leave tenants exposed.

Conclusion: A well-drafted non-disturbance agreement preserves a tenant’s right to occupy after foreclosure or ownership change and balances lender concerns with tenant stability. For final language and enforceability in your jurisdiction, it’s advisable to consult a licensed attorney experienced in commercial real estate or a trusted property manager before you sign or accept a non-disturbance agreement.