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Telecommunications and Cell Tower Leases
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You must review any telecommunications and cell tower lease to ensure it does not:
- comprise more than 5% of the Property'sProperty'sMultifamily residential real estate securing the Mortgage Loan, including the
fee simple or Leasehold interest,
Improvements, and
personal property (per the Uniform Commercial Code).
Effective Gross IncomeEffective Gross IncomeOn an annual basis or any specified period, the total of Net Rental Income plus other income per Part II, Chapter 2: Valuation and Income, Section 203: Income Analysis and the applicable products and features in Part III.
;
- negatively impact the Property'sProperty'sMultifamily residential real estate securing the Mortgage Loan, including the
fee simple or Leasehold interest,
Improvements, and
personal property (per the Uniform Commercial Code).
- value,
- visibility,
- livability, or
- marketability;
- impose an undue financial or operating burden on the PropertyPropertyMultifamily residential real estate securing the Mortgage Loan, including the
fee simple or Leasehold interest,
Improvements, and
personal property (per the Uniform Commercial Code).
or the BorrowerBorrowerPerson who is the obligor per the Note.
;
- obligate the BorrowerBorrowerPerson who is the obligor per the Note.
to rebuild any ImprovementsImprovementsBuildings, structures, improvements, and alterations, including the multifamily housing dwellings, now or hereafter constructed or placed on the Property, including all fixtures (as defined in the UCC).
at the PropertyPropertyMultifamily residential real estate securing the Mortgage Loan, including the
fee simple or Leasehold interest,
Improvements, and
personal property (per the Uniform Commercial Code).
post-casualty or condemnation;
- have a lease term (including extension options) in excess of 25 years;
- contain a purchase option; or
- convey any right to the tenant other than simple lessee rights (e.g., a perpetual easement, a purported sale of a portion of the ImprovementsImprovementsBuildings, structures, improvements, and alterations, including the multifamily housing dwellings, now or hereafter constructed or placed on the Property, including all fixtures (as defined in the UCC).
, unjustified exclusivity, etc.).
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| Communications Service Agreement |
You do not need to subordinate the service agreement to the LienLienLien, mortgage, bond interest, pledge, security interest, charge, or encumbrance of any kind.
of the Security InstrumentSecurity InstrumentInstrument creating a lien or encumbrance on 1 or more Properties and securing the Loan Document obligations.
if:
- the BorrowerBorrowerPerson who is the obligor per the Note.
certifies to you that neither the BorrowerBorrowerPerson who is the obligor per the Note.
, nor any Key PrincipalKey PrincipalPerson who
controls and/or manages the Borrower or the Property,
is critical to the successful operation and management of the Borrower and the Property, and/or
may be required to provide a Guaranty.
or PrincipalPrincipalPerson who owns or controls specified interests in the Borrower per Part I, Chapter 3: Borrower, Guarantor, Key Principals, and Principals, Section 303: Key Principals, Principals, and Guarantors.
, is an AffiliateAffiliateWhen referring to an affiliate of a Lender, any other Person or entity that Controls, is Controlled by, or is under common Control with, the Lender.
When referring to an affiliate of a Borrower or Key Principal:
any Person that owns any direct ownership interest in Borrower or Key… of the communications service provider; and
- the lease does not contain provisions for the BorrowerBorrowerPerson who is the obligor per the Note.
to assume liabilities and risks as landlord that would not be acceptable for you (as lender under the Mortgage LoanMortgage LoanMortgage debt obligation evidenced, or when made will be evidenced, by
the Loan Documents, or
a mortgage debt obligation with a Fannie Mae credit enhancement.
) in the context of a Foreclosure EventForeclosure EventAny of the following:
Foreclosure per the Security Instrument;
Fannie Mae's exercise of rights and remedies per the Security Instrument or applicable law (including Insolvency Laws) as holder of the Mortgage Loan and/or the Security Instrument, where Fannie Mae (or its designee or nominee),….
If a communications service agreement is accompanied by a lease or easement, then the lease or easement must end automatically when the service agreement expires, unless the service agreement is subordinated to the LienLienLien, mortgage, bond interest, pledge, security interest, charge, or encumbrance of any kind.
of the Security InstrumentSecurity InstrumentInstrument creating a lien or encumbrance on 1 or more Properties and securing the Loan Document obligations.
.
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Mineral Rights; Oil and Natural Gas Leases
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You must review each agreement or lease of mineral rights or rights relating to subsurface oil and natural gas to ensure that it does not:
- comprise more than 5% of the Property'sProperty'sMultifamily residential real estate securing the Mortgage Loan, including the
fee simple or Leasehold interest,
Improvements, and
personal property (per the Uniform Commercial Code).
Effective Gross IncomeEffective Gross IncomeOn an annual basis or any specified period, the total of Net Rental Income plus other income per Part II, Chapter 2: Valuation and Income, Section 203: Income Analysis and the applicable products and features in Part III.
;
- grant surface entry for any purpose (e.g., pipes, access across, or storage on the PropertyPropertyMultifamily residential real estate securing the Mortgage Loan, including the
fee simple or Leasehold interest,
Improvements, and
personal property (per the Uniform Commercial Code).
);
- grant subsurface rights within
- 250 feet below the surface of the PropertyPropertyMultifamily residential real estate securing the Mortgage Loan, including the
fee simple or Leasehold interest,
Improvements, and
personal property (per the Uniform Commercial Code).
, or
- 600 feet from any PropertyPropertyMultifamily residential real estate securing the Mortgage Loan, including the
fee simple or Leasehold interest,
Improvements, and
personal property (per the Uniform Commercial Code).
boundary line;
- have a material adverse effect on
- public health and safety,
- air quality or noise levels, or
- the Property'sProperty'sMultifamily residential real estate securing the Mortgage Loan, including the
fee simple or Leasehold interest,
Improvements, and
personal property (per the Uniform Commercial Code).
marketability or occupancy;
- permit oil or gas well activities with potential negative effects on the Property'sProperty'sMultifamily residential real estate securing the Mortgage Loan, including the
fee simple or Leasehold interest,
Improvements, and
personal property (per the Uniform Commercial Code).
- access,
- visibility, or
- storm water drainage;
- have a negative effect on the Property'sProperty'sMultifamily residential real estate securing the Mortgage Loan, including the
fee simple or Leasehold interest,
Improvements, and
personal property (per the Uniform Commercial Code).
- zoning, or
- allowable density;
- facilitate drilling, storage, or processing of oil or gas on the PropertyPropertyMultifamily residential real estate securing the Mortgage Loan, including the
fee simple or Leasehold interest,
Improvements, and
personal property (per the Uniform Commercial Code).
or any adjacent property; or
- fail to require the lessee to indemnify and hold harmless the BorrowerBorrowerPerson who is the obligor per the Note.
, as lessor, for any damage to the PropertyPropertyMultifamily residential real estate securing the Mortgage Loan, including the
fee simple or Leasehold interest,
Improvements, and
personal property (per the Uniform Commercial Code).
or any other damage or liability caused directly or indirectly as a result of the oil and gas exploration or drilling activities.
The BorrowerBorrowerPerson who is the obligor per the Note.
must execute Form 6262 if a lease or deed reservation of rights allows for the subsurface exploration of oil, natural gas, or minerals, but no evidence of active or planned exploration or drilling exists on the PropertyPropertyMultifamily residential real estate securing the Mortgage Loan, including the
fee simple or Leasehold interest,
Improvements, and
personal property (per the Uniform Commercial Code).
.
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Laundry Lease
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You do not need to subordinate the lease to the LienLienLien, mortgage, bond interest, pledge, security interest, charge, or encumbrance of any kind.
of the Security InstrumentSecurity InstrumentInstrument creating a lien or encumbrance on 1 or more Properties and securing the Loan Document obligations.
if you confirm that the lease:
- is not with an AffiliateAffiliateWhen referring to an affiliate of a Lender, any other Person or entity that Controls, is Controlled by, or is under common Control with, the Lender.
When referring to an affiliate of a Borrower or Key Principal:
any Person that owns any direct ownership interest in Borrower or Key… of the BorrowerBorrowerPerson who is the obligor per the Note.
or any Key PrincipalKey PrincipalPerson who
controls and/or manages the Borrower or the Property,
is critical to the successful operation and management of the Borrower and the Property, and/or
may be required to provide a Guaranty.
or PrincipalPrincipalPerson who owns or controls specified interests in the Borrower per Part I, Chapter 3: Borrower, Guarantor, Key Principals, and Principals, Section 303: Key Principals, Principals, and Guarantors.
;
- has market terms;
- contains an acceptable termination for cause provision; and
- meets recognized industry standards.
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Equipment or Related Maintenance Services Lease
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You must ensure that the lease:
- is subordinate to the Security InstrumentSecurity InstrumentInstrument creating a lien or encumbrance on 1 or more Properties and securing the Loan Document obligations.
;
- contains an acceptable termination for cause provision; and
- meets recognized industry standards.
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