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Tenant: One who has the temporary possession of real property owned by another (the 'Landlord'). Also called a 'Lessee'.

Tenant Allowance: A monetary allowance granted from the landlord to a tenant to entice tenant to move into landlord's building which will enable the tenant to prepare the leased premises for tenant's occupancy. Tenant Allowances may include a tenant improvement allowance, moving allowance, space plan/drawing allowance and/or lease buyout.

EXAMPLE: To induce ABC Tenant to execute a lease at Ellipsis Tower, the Landlord offers ABC a $2.00/sq. ft. moving allowance and a $20.00/sq. ft. tenant improvement allowance. Each of these allowances granted to ABC by the Landlord is a Tenant Allowance.

Term: The length of time that a lease transaction is in effect, measured as the period of time between the Commencement Date and the Expiration Date.

Termination Option: An option granted to either a landlord or tenant to end the term of a lease prior to the scheduled Expiration Date. In some terminations, the lease requires the terminating party to pay a fee for the right to cancel.

EXAMPLE: ABC Tenant signs a five-year lease for 10,000 square feet in Suite 500 at Ellipsis Tower, but is concerned that more space will be needed prior to the expiration of the term to accommodate the growth in their business. The Landlord does not have sufficient space available to grant an Expansion Option. Therefore, ABC negotiates a right to terminate the lease after 3 years (to allow them to move into another building which can accommodate their growth needs) upon 6 months notice to the Landlord and payment of a Termination Penalty equal to the summation of 2 months of Base Rent at the date of cancellation plus unamortized tenant improvements and leasing commissions.

Termination Penalty: Consideration to be paid by the terminating party to the non-terminating party in order to end the term of a lease via a Termination Option.

EXAMPLE: See example for 'Termination'

Triple Net: Rent stipulated in a lease which requires the tenant to pay it's proportionate share of real estate taxes, insurance and operating expenses. In the real estate industry, the terms Triple Net and Net are often used with the same meaning.

EXAMPLE: ABC Industrial Tenant occupies 100% of the rentable area of ABC Industrial Building. Their lease requires them to pay Base Rent of $7.50/sq. ft. triple net. In this instance, rather than the Landlord making real estate tax, insurance and operating expense payments to the appropriate taxing authorities/vendors and being reimbursed by ABC, ABC is responsible for making such payments directly to the taxing authorities/vendors.

True-Up: Also called a 'Reconciliation Billing', reflects a billing to tenants for the difference between estimated payments made by the tenant for an item of Rent (usually Expense Recoveries) and the actual payment due. Reconciliation Billings are made to a tenant after the landlord has determined the actual amounts to be billed in accordance with the lease provisions.

EXAMPLE: See example for 'Reconciliation Billing'.

Turn-key: A term used to describe a landlord's agreement to provide and pay for improvements to a tenant's premises which are required to deliver the premises in a condition ready for the tenant's stipulated use.