Cover Image

Not for Sale

View/Hide Left Panel
Click for next page ( 21

The National Academies | 500 Fifth St. N.W. | Washington, D.C. 20001
Copyright © National Academy of Sciences. All rights reserved.
Terms of Use and Privacy Statement

Below are the first 10 and last 10 pages of uncorrected machine-read text (when available) of this chapter, followed by the top 30 algorithmically extracted key phrases from the chapter as a whole.
Intended to provide our own search engines and external engines with highly rich, chapter-representative searchable text on the opening pages of each chapter. Because it is UNCORRECTED material, please consider the following text as a useful but insufficient proxy for the authoritative book pages.

Do not use for reproduction, copying, pasting, or reading; exclusively for search engines.

OCR for page 20
20 Guidebook for Developing and Leasing Airport Property maintenance and upkeep as the lease nears the end of its term. The tenant The airport sponsor must guarantee should understand that leasehold improvements are "wasting assets" that the right to inspect the premises in have a limited useful life (typically the length of the lease term), and will order to ensure compliance with depreciate through the course of the lease. In other words, most tenants will the lease agreement. Right to typically enter into long-term lease agreements with the understanding that inspect must extend not only to any investment in leasehold improvements will be fully depreciated over the the primary tenant, but also to all length of the lease and have no expectation of asset recovery at the termination sublessees as well. Anchorage Inter- of the lease. Since leasehold improvements will revert to airport ownership, national Airport, when working tenants may have little motivation to put additional resources into the cur- with the developer and primary rent facility unless enforceable specifications for upkeep and maintenance are lessee of the Alaska CargoPort, appropriately detailed in the lease document or referenced in the Airport Min- included language in the lease imum Standards document. Specifically, a schedule for routine and preventive that guaranteed the right of the maintenance and set system inspections with reports to airport management is airport to inspect the premises of prudent language to include. all sublessees of the facility. As a Leases that are do not specify reversion, or that leave ownership of the result, all sublease agreements improvements with the developer/tenant, can cause an unexpected or unpre- administered by the primary tenant pared obligation on the part of the airport sponsor. Leases that require the air- include language that guarantees port sponsor to purchase the improvements from the tenant may put a financial the airport access for inspection. burden on the sponsor when the lease expires. These obligations must be con- sidered, and funding sources established, if the airport plans on entering into an agreement that requires payment to the lessee at the end of the lease term. 2.2.11 Rights, Reservations, and Obligations of Lessor Many contemporary leases provide the lessor with the right of ingress and egress to leased premises. Leases should also reference the rights of the lessor for the purpose of enforcing com- pliance with the Airport Rules and Regulations and for ensuring that maintenance standards detailed in the lease agreement are being met. In addition, the airport sponsor may wish to include the right to show the property to potential tenants prior to lease expiration, or if the lease is expected to be terminated for any other reason. Since the lessee will have leasehold rights to the improved facility, the lease should specify a reasonable lessor notification period prior to inspec- tion, or establish an inspection schedule within the lease document. Airport management may also want to reserve the right to close the airport facility, including, but not limited to, the runway, taxiway, apron, terminal building, and automobile parking facil- ities when reasonably necessary. This should be at the airport's sole discretion for the purpose of maintenance, repair, further development or construction, or for the safety of the general public. 2.2.12 Rights, Reservations, and Obligations of Lessee This element of the lease agreement should clearly state the rights that the tenant is entitled to as lessee, and the obligations the lessee must fulfill under the lease agreement. Rights of the les- see typically include, but are not limited to Ingress and egress, including use of public infrastructure; Signage (for commercial enterprises), stipulating acceptable size, location, and form; Quiet enjoyment, defined as possession and unimpaired use of the leasehold without interfer- ence; and Approved alterations and additions to improvements. The obligations of the lessee section of the lease should include those functions that are typi- cally associated with the operation of the specific facility. Obligations of the lessee should not