Document background
The Landlord Subordination Agreement is a crucial document in commercial property financing transactions in Pakistan. It is typically required when a tenant seeks to obtain financing where the lender requires security over the tenant's leasehold interest and/or assets located at the leased premises. The agreement ensures that the lender's security interests take priority over the landlord's rights under the lease agreement, providing the lender with necessary comfort for extending financing. The document must comply with Pakistani legal requirements, including the Transfer of Property Act 1882, Contract Act 1872, and relevant provincial property laws. It becomes particularly important in scenarios involving commercial property leases where tenants require significant financing for business operations or improvements to the leased property.
