«GLOSSARY OF TERMS The following Glossary of Terms is not intended to be legal definitions, but rather a lay expression or explanation of how the ...»
FLUORESCENT LIGHTING: A tubular electric lamp with a coating of fluorescent material on its surface and containing mercury vapor, whose bombardment by electron from the cathode provides ultraviolet light which then causes the material to emit visible light. There are several types: (1) Rapid Start bulb, a typical 4 foot 0 degree office bulb; (2) slimline, 8 foot 0 degree, the best combination of fluorescent installation as to cost and output; (3) Power Groove (VHO), giving the greatest fluorescent output, but superseded by mercury vapor; (4) industrial fixture, which includes a reflector to concentrate light downward; (5) pan or strip fixture, which is an inexpensive supermarket type without a reflector; and (6) uplight slots, which provide a good quality fixture to direct some light to the ceiling, reducing the contrast and keeping the lamp cool and clean.
FOOTCANDLE: A measurement of light level. It is equivalent to the light intensity made by one candle at a distance of one foot.
FOOTCANDLES MAINTAINED: The level of light that will be maintained after the initial drop-off of footcandles following installation. Usually it will be after the first 100 hours of burning.
FOOTING: The concrete or brickwork base of a wall or column. It is wider than the structure and is designed to spread the weight of the structure over the ground. It is usually located below freezing level.
FOREBEARANCE: Refraining from action by a creditor against the debt owed by a borrower after the debt has become due. It is usually granted only when a borrower makes a satisfactory arrangement by which the arrears will be paid at a future date.
FORECLOSURE: A legal procedure whereby property used as security for a debt is sold to satisfy the debt in the event of default in payment of the mortgage note or default of other terms in the mortgage document. The foreclosure procedure brings the rights of all parties to a conclusion Allard Commercial Brokerage –Glossary of Terms Page 34 of 34 and passes the title in the mortgage property to either the holder of the mortgage or a third party who may purchase the realty at the foreclosure sale, free of all encumbrances affecting the
property subsequent to the mortgage. There are three general types of foreclosure proceedings:
judicial foreclosure, nonjudicial foreclosure and strict foreclosure.
FOUNDATION WALL: The exterior wall support that rests below ground level.
FRAUD: Any form of deceit, trickery, breach of confidence or misrepresentation by which one party attempts to gain some unfair or dishonest advantage over another. Unlike negligence, fraud is a deceitful practice or material misstatement of a material fact, known to be false, and done with intent to deceive, or with reckless indifference as to its truth, and relied on by the injured party to his or her damage.
FRAUD, CONSTRUCTIVE: Breach of a legal or equitable duty that the law declares fraudulent because of its tendency to deceive others, despite no showing of dishonesty or intent to deceive.
A broker may be charged with constructive fraud for failing to disclose a known material fact when the broker had a duty to speak--for example, if a listing broker failed to disclose a known major foundation problem not readily observable upon an ordinary inspection.
FREE RENT: Period of time in which the tenant occupies the premises under the lease but does not pay rent. Tenant may be required to pay operating expenses during this period.
FREEHOLD ESTATE: An estate in land in which ownership is for an indeterminate length of time, in contrast to a leasehold estate.
FRONT FOOTAGE: The measurement of a parcel of land by the number of feet of street or road frontage.
FULL SERVICE: Utilities, janitor, taxes, insurance and exterior maintenance, and base year taxes.
FULLY AMORTIZED NOTE: Fully amortized notes are paid in equal monthly installments, which include interest and amortization of principal, paid over a period of years. The interest is set at a predetermined rate and is charged only on the loan balance. As payments are made the amount allocated to interest decreases while the amount allocated to principal increases. At the end of the term the mortgage will be paid in full, including interest. No balloon payment is required.
FUNCTIONAL OBSOLESCENCE: A loss of value or marketability to an improvement to real estate arising from functional problems, often caused by age or poor design. (see Obsolescence).
GAP FINANCING: Financing to cover the holdback difference between the floor loan and the full loan amount.
GENERAL LIEN: A lien on all property, both real and personal, of a debtor.
GENERAL PLAN: Every city and county is required to develop a general plan of comprehensive zoning.
Allard Commercial Brokerage –Glossary of Terms Page 35 of 35 GIFT DEED: A deed in which the consideration is "love and affection," used to make a gift of property to a grantee, usually a close friend or relative. Because the deed is not supported by valuable consideration, the grantee may not be able to enforce against the grantor certain promises or agreements contained in the deed.
GIRDER: A horizontal main member that supports roof or floor joists.
GLUE LAMINATED BEAMS: Beams supporting roof structure constructed of layers of wood glued and pressed together (as opposed to steel beams).
GOOD CONSIDERATION: Gifts such as real property based solely on love and affection.
GOODWILL: An intangible, salable asset arising from the reputation of a business; the expectation of continued public patronage; includes other intangible assets like trade name and going concern value. When a business is sold, the sales price often reflects its goodwill value.
GRACE PERIOD: An agreed-upon time after the payment of a debt is past due, during which a party can perform without being considered in default.
GRADUATED LEASE: A lease that provides for specific increases or decreases in rent at definite times during the term of the lease.
GRADUATED PAYMENT ADJUSTABLE MORTGAGE (GPAM): A loan in which the monthly principal and interest payments graduate by a certain percentage each year for a specific number of years, then level off for the remaining term of the loan.
GRANT: To bestow or confer, with or without compensation, a gift such as land or money by one having control or authority over the gift.
GRANT DEED: A type of deed in which the grantor warrants that he or she has not previously conveyed the property being granted to another, that he or she has not encumbered the property except as noted in the deed, and that he or she will convey to the grantee any title to the property acquired later.
GRANTEE: The person who receives a conveyance of real property from a grantor. The grantee must be a person, either natural or otherwise (e.g. corporation, public agency, partnership, etc.) who (or that) exists at the time of the conveyance and is capable of taking title.
GRANTOR: The person transferring title to, or an interest in, real property. A grantor must be competent to convey title. A corporate grantor must have legal existence and be authorized to hold and convey title to real property. The grantor must be clearly identified in the deed.
GROSS INCOME: The scheduled income from the operation of the business or the management of the property, customarily stated on an annual basis.
GROSS LEASE: The antonym of net lease. One in which the owner pays taxes, insurance, maintenance, operating expenses, etc. The gross lease today is confined largely to older commercial buildings and multi-tenant buildings. Warning: One must read the lease document to insure which items are paid by the owner and if the increases are paid by the tenant after the base year.
GROSS RECEIPTS: Gross amount of receipts. May or may not equal gross income. (In merchandising, gross receipts minus cost of good sold = gross income. In real estate brokerage, gross receipts = gross income. In service type business, gross receipts = gross income.) GROSS RENT: Income (figured annually) received from rental units before any expenses are deducted.
GROSS RENTABLE: Rentable area of a single tenancy floor, whether above or below grade, shall be computed by measuring to the inside finish of permanent outer building walls, or from the glass line where at least 50% of the outer building wall is glass. Rentable area shall include all area within outside walls, less stairs, elevator shafts, flues, pipe shafts, vertical ducts, airconditioning rooms, fan rooms, janitor closets, electrical closet - and such other rooms not actually available to the tenant for his furnishings and personnel - and their enclosing walls. Toilet rooms within and exclusively serving only that floor shall be included in rentable area.
GROSS RENT MULTIPLIER (GRM): The figure used as a multiplier of the gross monthly income of a property to produce an estimate of the property's value.
GROSS SCHEDULED INCOME: The maximum amount of rent if the property were 100 percent occupied.
GROUND LEASE: A lease of land alone, usually of long duration, to a tenant who covenants to erect or has erected a building on the premises. Also called a land lease, the ground lease is a means used to separate the ownership of the land from the ownership of the buildings and improvements constructed on the land. (See Subordinated Ground Lease).
GROUND RENT: Earnings or income from an investment attributable to the ground itself.
GROUNDWATER: Water under the earth's surface, regardless of the geological structure in which the water is standing or flowing. It does not include water in underground streams that have identifiable banks and beds.
GUARANTEE OF TITLE: An assurance of clear title.
GYPSUM ROOF DECK: Concrete-like gypsum poured in sheetrock or fiberglass formboard, which is supported on structural tees that are supported on roof joists.
H COLUMN: A structural column with a wide flange shaped like an H.
HANDICAPPED REQUIREMENTS: Code required features designed to accommodate handicapped persons. Included are entry ramps, restroom fixtures, hardware, special doors, etc.
HANGOUT: The difference between the loan amortization period and a lease term, when the lease is for a shorter period than the loan term. If a 20-year lease is taken as security in a 25-year loan, a 5-year hangout exists.
HARD MONEY LOAN: A loan made in cash by a non-institutional lender.
HAZARDOUS WASTE: A subset of solid wastes that pose substantial or potential threats to public health or the environment and meet any of the following criteria: (i) specifically listed as a hazardous waste by EPA; (ii) exhibits one or more of the characteristics of hazardous waste (ignitability, corrosiveness, reactivity, and/or toxicity); or (iii) generated by the treatment of hazardous waste, or contained in a hazardous waste. These toxic waste materials jeopardize the value of real estate. (Examples: asbestos, underground storage tanks, urea-formaldehyde.) HAZARDOUS WASTE DISCLOSURE: California Health and Safety Code (§25359.7(a)) requires owners of nonresidential properties to disclose to prospective buyers or lessees the existence of hazardous substances on or beneath a property. Both residential and nonresidential tenants are required to notify landlords if hazardous substances have been released on a property.
HIGH INTENSITY DISCHARGE LIGHTING (HID): The discharge of electricity between electrodes causes luminosity of the enclosed vapor or gas, thus producing light. There are several kinds: mercury vapor, which has the longest life; metal halide, the most often used today, and which gives more light output per watt; and sodium vapor. It is used in high ceiling applications.
HIGH HAZARD DESIGN: A system designed to reduce risks due to concentrated flammable occupancies.
HIGHEST AND BEST USE: That particular use of a property that will produce the greatest net income and thereby develop the highest value.
HOLDBACK: Funds not released under a construction loan agreement due to a failure to satisfy some additional requirement (rental, finishing, fixturizing, lease up to a required minimum, etc.).
HOLDER: The party to whom a promissory note is made payable.
HOLDER IN DUE COURSE: The holder of a negotiable instrument (check or note) purchased for value when the instrument appears complete and regular on its face; is taken before its due date and without notice of previous dishonor; and the holder has no notice of any defects in title of the transferor.
HOLDING AREA: A space or room usually in the freight docking area where deliveries to a tenant (or to the building management) may be held until delivered; sometimes also called a receiving area.
Allard Commercial Brokerage –Glossary of Terms Page 38 of 38 witnessed, presumably on the theory that the handwriting can be analyzed to verify authenticity and demonstrate competency.
HUNG CEILING: One that is lightweight and suspended to reduce ceiling height and for decorative and acoustical purposes.
H.V.A.C.: Heating, ventilation and air conditioning.
HYDRAULIC DESIGN: A sprinkler system designed for new buildings with high stacking occupancy.
HYPOTHECATE: To pledge real or personal property as security for a loan or other obligation without surrendering possession of the property. The borrower retains the rights of control and possession, and the lender secures an underlying equitable right in the pledged property.
I BEAM: A structural shape with a narrow flange shaped like an I and used horizontally to support the roof deck or upper floor slab.
ILLUSORY CONTRACT: An apparent contract that is not a contract because the parties have not agreed to be bound.
IMPLIED CONTRACT: A contract under which the agreement of the parties is demonstrated by their acts and conduct rather than words.