Status: implemented

Implemented — this change has shipped.

RFC 0055: Typed commercial lease clauses

Summary

RFC 0054 decided that lease clauses are attributes of a lease and belong on the lease record rather than in a period series. This contract carries that out: it types the stubs the commercial rent roll has carried since Format 1.0, adds the leasing-commission balance that sits missing beside the tenant-improvement one, and registers an LSE-NN validator family.

It also corrects two format passages that describe an addressability the calc engine does not have.

Everything is optional and verified, never derived. No rent is escalated, no break is exercised, and no balance is amortized.

Motivation

rent_roll's commercial variant already names the clauses that decide a commercial deal, and leaves them as untyped nulls:

"escalation_type": "fixed_pct | cpi | fixed_dollar | none | null",
"escalation_rate_pct": null,
"escalation_schedule": null,
"termination_option": null,
"co_tenancy_clause": false,
"co_tenancy_details": null,
"ti_allowance_original": null,
"ti_outstanding_balance": null,
"cam_cap_pct": null

This is the RFC 0053 situation again. A producer with a real rent roll has a step schedule, a break date with a notice period and a penalty, and a co-tenancy trigger with a remedy — and the only place to put any of it is a free-text notes field or a null. Nothing can be compared across deals and nothing can be checked.

Two of these are also where commercial underwriting goes wrong quietly. A break option that nobody models turns a ten-year WALT into a five-year one. A co-tenancy clause with no stated remedy hides the fact that an anchor departure re-prices half the rent roll.

The leasing commission has no field at all. ti_allowance_original and ti_outstanding_balance exist; lc_* does not, so the other half of the capital a lease costs to sign cannot be stated beside it.

Proposed change

Every member below is OPTIONAL on a tenant record. A document stating none of them validates exactly as it does today. Rates are fractions, not percents.

1. escalation_schedule — the explicit steps

interface RentStep {
  effective_date: string;      // YYYY-MM-DD
  base_rent_annual: number;    // the rent from this date, not the increment
}

Stating the resulting rent rather than the increment is deliberate: a reader should not have to compound a list of percentages to learn what a tenant pays in year six, and a producer should not have to agree with us about rounding to be verifiable.

Code	Rule
LSE-01	Steps are strictly increasing by effective_date, each a real date, with base_rent_annual finite and nonnegative.
LSE-02	Every step lies within [lease_commencement, lease_expiration] when both are stated.
LSE-03	A schedule requires escalation_type to be stated and not none. A flat lease does not carry a step schedule.

The schedule does not have to begin at commencement — a lease whose first bump is in month 13 states one step, not two.

2. termination_option — the break

interface TerminationOption {
  earliest_date: string;        // YYYY-MM-DD
  notice_months: number;        // integer, >= 0
  penalty: number | null;       // stated cash, null when genuinely none
  penalty_includes?: Array<'unamortized_ti' | 'unamortized_lc' | 'free_rent' | 'fee'>;
  conditions?: string;          // author narrative; nothing is inferred from it
}

Code	Rule
LSE-04	earliest_date is a real date inside the lease term, notice_months a nonnegative safe integer, and penalty finite and nonnegative when stated.
LSE-05	penalty_includes entries come from the closed list, without duplicates.

penalty_includes records what the stated penalty is composed of. It does not recompute it: unamortized balances are periodic, which RFC 0054 placed outside this contract.

3. co_tenancy_details — the trigger and the remedy

interface CoTenancyDetails {
  trigger: 'named_tenant_departure' | 'occupancy_threshold' | 'both';
  named_cotenants?: string[];       // required when trigger names tenants
  occupancy_threshold?: number;     // a fraction; required when trigger is occupancy
  remedy: 'rent_reduction' | 'alternate_rent' | 'termination_right';
  remedy_value?: number;            // fraction for reduction, cash for alternate rent
  cure_period_months?: number;      // integer, >= 0
}

Code	Rule
LSE-06	co_tenancy_details requires co_tenancy_clause: true, and co_tenancy_clause: true requires details. The boolean and the body agree or neither is stated.
LSE-07	The trigger carries what it needs: a nonempty named_cotenants when it names tenants, an occupancy_threshold in (0, 1) when it is a threshold, both when it is both.
LSE-08	remedy_value is required for rent_reduction and alternate_rent and refused for termination_right; a reduction is a fraction in (0, 1], an alternate rent is nonnegative.

LSE-06 is the same move TAX-04 made for sale_triggers_reassessment: a boolean that asserts nothing until something has to agree with it.

4. Leasing commissions beside tenant improvements

Add lc_original and lc_outstanding_balance, mirroring the existing TI pair.

Code	Rule
LSE-09	TI and LC amounts are finite and nonnegative, and an outstanding balance never exceeds its original.

This states the balances. It does not amortize them — RFC 0054 placed the roll-forward in the deferred period series, and straight-line amortization waits for that contract.

5. Correct the addressability claim (RFC 0054)

Format §4.25 and §4.26 both claim these structures stay "addressable by ordinary path traversal," citing lease_up_schedule.schedule[5].rent_revenue and cash_flow_series.series[3].amount. Neither parses: calc paths are flat identifiers and both expressions raise CALC-PARSE-001.

Replace the claim with what is true — the structures are read by verifiers and by host code, not by pack formulas — so no future decision rests on an addressability the engine does not offer.

Compatibility

Purely additive. Every member is optional, no existing field changes shape, and no existing fixture moves. The LSE-NN codes are new and fire only on documents that state the new members. escalation_type, co_tenancy_clause, ti_allowance_original and ti_outstanding_balance keep their current meaning and gain only the agreement rules above.

Format minor and Protocol minor. No package API is removed.

Out of scope

• Amortization of TI or LC, and the balance roll-forward. Periodic; deferred by RFC 0054.
• Exercising anything. No break is taken, no co-tenancy remedy applied, no step projected into NOI. These are stated terms, not a model.
• CAM true-ups and recovery reconciliation. Periodic.
• Residential leases. The multifamily variant is unit-level and month-to-month and shows no equivalent need.
• cam_cap_pct, which is already a typed number and needs nothing.
• Percentage rent, sales kick-outs, and exclusive-use clauses. Real, but no stub exists and no producer has asked; they want their own vocabulary.

Conformance

• A tenant with a four-step escalation, a break option, a co-tenancy clause and TI/LC balances validates clean.
• Steps out of order, duplicated, or outside the lease term each refuse LSE-01/LSE-02.
• A schedule beside escalation_type: "none" refuses LSE-03.
• A break date after expiration, a fractional notice_months, and a negative penalty each refuse LSE-04; a duplicated penalty_includes entry refuses LSE-05.
• Details without the boolean, and the boolean without details, both refuse LSE-06.
• Each trigger missing its required companion refuses LSE-07.
• A termination_right carrying a remedy_value, and a rent_reduction without one, both refuse LSE-08.
• An outstanding balance above its original refuses LSE-09, for TI and for LC.
• A document stating none of the new members is unchanged, and the existing corpus passes untouched.