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Acronyms, Abbreviation and Jargon in New York Commercial Real Estate
To help our junior lawyers we have gathered many acronyms, abbreviations and phrases that are commonly used in commercial real estate transactions in New York. This list will help Olshan lawyers decipher the sentence, “We need to sign the NDA before they give us the LOI for the JV.”
ACRIS – Automated City Register Information System
AG – Attorney General
ALR – Assignment of Leases and Rents
ALTA – American Land Title Association
ALTA 9 – Title policy endorsement that insures against violations of CCRs
APR – Annual Percentage Rate
ARM – Adjustable Rate Mortgage
BLA – Building Loan Agreement (construction loan)
CAM – Common Area Maintenance charges (usually for shopping centers)
CAP EX – Capital Expenditures (to be distinguished from OP EX)
Carve Outs – the exceptions to the non-recourse provisions of loan documents, typically guaranteed under a non-recourse carve-out guaranty, a/k/a Bad Boy Guaranty
CCR – Conditions, Covenants, and Restrictions
CEMA – Consolidation, Extension and Modification Agreement
CFIUS – Committee on Foreign Investment in the U.S.
CMA – Cash Management Agreement
CO, COO or C of O – Certificate of Occupancy
CONFI – Confidentiality Agreement (a/k/a Non-Disclosure Agreement or NDA)
CRE – Commercial Real Estate
DBA – Doing Business As
DCR or DSCR or DSR – Debt Service Coverage Ratio
DD – Due Diligence (a/k/a due dili)
DOB – Department of Buildings
DOF – Department of Finance
EBITDA – Earnings Before Interest, Taxes, Depreciation and Amortization (similar to NOI)
FADR – Floor Area Development Rights (a/k/a Air Rights)
FAR – Floor Area Ratio (zoning ratio)
FCRA – Fair Credit Reporting Act
FDIC – Federal Deposit Insurance Corporation
FEMA – Federal Emergency Management Agency
FHLMC – Freddie Mac (Federal Home Loan Mortgage Corporation) (a/k/a Freddie)
FIRPTA – Foreign Investment in Real Property Tax Act
FMV – Fair Market Value
GL – Ground Lease
GO DARK – the restriction on or right of a store tenant to close the store for maintenance or other reasons or to simply close while still paying rent
GOOD GUY – Good Guy Guaranty – guaranty of rent during tenant’s period of occupancy – typically terminates upon delivery of vacant possession
GP – General Partner (although “general partner” refers to the old limited partnership format, it’s still often used to refer to the Manager or Managing Member of an LLC)
HARD DEPOSIT – a deposit that is or becomes non-refundable. [Similar – “Go Hard” means to elect to proceed with transaction and put deposit at risk after diligence period expires.]
HOA – Homeowners Association
HUD – Department of Housing and Urban Development
HVAC – Heating, Ventilation and Air Conditioning
ICAP – Industrial & Commercial Abatement Program (property taxes)
I/O – Interest Only (Loan)
IRA – Individual Retirement Account
IRR – Internal Rate of Return
IRS – Internal Revenue Service
JV – Joint Venture (usually in the form of an LLC)
K – Contract
KYC – Know Your Customer (background check under money laundering and anti-crime rules)
LA – Loan Agreement
LC – Letter of Credit
LIBOR – London Interbank Offered Rate
LLC – Limited Liability Company
LLP – Limited Liability Partnership
LOI – Letter of Intent
LTV – Loan to Value
MIPA – Membership Interest Purchase Agreement (for the sale of LLC membership interests)
MLS – Multiple Listing Service
NDA – two meanings: Non-Disclosure (a/k/a Confidentiality) Agreement or Non-Disturbance Agreement (a/k/a “SNDA”)
NNN – Triple Net Lease
NOI - Net Operating Income (similar to EBITDA)
NON CON - Non Consolidation Opinion (for larger loans an opinion that this property will not be consolidated with other properties in a bankruptcy)
OFAC – Office of Foreign Assets Control
OP EX – Operating Expenses (to be distinguished from Cap Ex)
OP UNITS – Operating Partnership Units (typically issued by a REIT)
PG – Personal Guaranty
PMA – Property Management Agreement/ PM – Property Manager
POA – Power of Attorney
PREF – Preferred Return
PRO FORMA – draft title policy
PROMOTE – a return to the GP of the JV that is higher than a pro rata return on capital contributions intended to reward the GP for profits earned over a baseline IRR
PSA – Purchase and Sale Agreement
PUD – Planned Unit Development
Q1, Q2, Q3, Q4 – accounting period quarters
REA – Reciprocal Easement Agreement
REBNY – Real Estate Board of New York
REIT – Real Estate Investment Trust
REO – Real Estate Owned
ROFO – Right of First Offer
ROFR – Right of First Refusal
ROI – Return On Investment
SHOTGUN – a buy/sell provision in a JV under which the recipient of the exercise notice must elect to either purchase or sell at the price named in the notice
SNDA – Subordination and Non-Disturbance Agreement
SOFT DEPOSIT – a contract deposit that is refundable after diligence period
SPA – Stock Purchase Agreement or Sale-Purchase Agreement (with the latter more commonly referred to as a PSA)
SRO – Single Room Occupancy
TABLE A – List of optional ALTA survey requirements
TOE – Time of the Essence
UPREIT – Umbrella Partnership created by a REIT
UST – Underground Storage Tank
WATERFALL – the series of clauses in an LLC Agreement which control the flow of proceeds of the business
ZLDA – Zoning Lot Development Agreement
For additional jargon, see the 2009 Probate and Property Magazine article by Joshua Stein and Obianuju A. Enendu at this link.
Thanks to my colleagues Hyman Kindler and Vesna Naidoo-Chinsammy for their contributions and to Joshua Stein for the tip about his article and to Laurie Nelson, Andrew Baraff, Steve Hantz and David Rosenberg for their contributions.