Escrow & Title

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

AA three-party agreement resolving disputes between co-owners of commercial property
BAn agreement where a tenant subordinates their lease to a mortgage, the lender agrees not to disturb the tenant if they foreclose, and the tenant agrees to recognize any new owner✓ Correct
CA PREC agreement requiring licensees to subordinate personal interests to client interests
DAn escrow agreement providing non-disturbance protection for earnest money deposits

Explanation

An SNDA (Subordination, Non-Disturbance, and Attornment) agreement is a three-way arrangement in commercial leasing: (S) the tenant subordinates their lease to the lender's mortgage; (ND) the lender agrees not to disturb the tenant's possession if foreclosure occurs and the tenant is not in default; (A) the tenant agrees to recognize (attorn to) any successor owner after foreclosure. Pennsylvania commercial tenants should insist on SNDA agreements to protect their occupancy rights in the event of landlord default.

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