Glossary

Parking License Agreement

Also known as: parking agreement

A separate agreement, distinct from the office lease itself, granting a tenant or its employees the right to use a specified number of parking spaces for a monthly fee, typically structured as a revocable license rather than a leasehold interest.

Structuring parking rights as a license rather than as part of the leasehold matters legally and operationally: a license can typically be modified, relocated, or terminated by the landlord on shorter notice than the underlying office lease could be, giving the landlord flexibility to reconfigure a garage, respond to a citywide parking maximum ordinance, or reallocate spaces among tenants as the tenant mix changes, without triggering a default or lease amendment. Parking income is also frequently underwritten and, in some ownership structures, even sold or financed separately from the office building itself (particularly where a third-party parking operator manages the garage under a separate operating agreement with the landlord), which is why parking revenue sometimes appears as a distinct line item in an office property's operating statement rather than being embedded in base rent.