What is 'subordination, non-disturbance, and attornment' (SNDA) in commercial real estate leasing?

SNDA AGREEMENTS are standard in commercial real estate financing and leasing. Why each provision matters: SUBORDINATION: The lender's mortgage takes priority over the tenant's lease — if the building is foreclosed, the senior position matters for property rights. Without subordination, a lease that predates the mortgage might survive foreclosure. NON-DISTURBANCE: Protects the tenant — they don't want to lose their space because the landlord defaulted on their loan. The lender agrees to honour the lease even after foreclosure. ATTORNMENT: The tenant agrees to recognize the new owner (foreclosing lender or purchaser at foreclosure) as their landlord and pay rent to them. Without SNDA, tenant and lender are in a position of uncertainty after foreclosure. Commercial tenants with significant improvements or long-term leases almost always require SNDAs before signing.