Placepoint

Tenants

A tenant is the natural or legal person who, for payment, gains the right to use a property or part of it without owning it. The other party is the landlord, and the relationship is governed by a lease.

For real property, a distinction is made between residential letting and commercial letting. Residential letting is governed by the Tenancy Act (husleieloven) of 1999, which sets the framework for the condition of the premises at handover, the level of rent and index adjustment, protection against termination, and procedures in the event of defects. The Act is largely non-derogable: terms that are less favourable to the tenant than the Act cannot be enforced. Tenancy disputes are handled by Husleietvistutvalget (the tenancy dispute committee) in Oslo, Akershus, Bergen and Trondheim, and by the conciliation board elsewhere.

For commercial letting, freedom of contract is central. The standard contracts from Norsk Eiendom (formerly Forum for Næringsmeglere) are used as a starting point in most negotiations and cover the lease term, rent, index adjustment against the consumer price index (CPI), the division of maintenance, subletting and termination terms. Long contracts in bare-house, single-net or triple-net form divide responsibility for external maintenance, property tax and insurance differently between the parties.

Other forms of letting are the tenant farming of agricultural property under the Tenant Farming Act (forpaktningsloven) and tomtefeste (ground lease) under the Ground Lease Act (tomtefesteloven), where the landowner lets the plot to the person who owns the house.

For commercial property, the tenant overview is at the core of the valuation. The duration of the leases (often measured as WAULT, weighted average unexpired lease term), the tenants' ability to service the rent and the mix of contract types determine the cash flow and risk, and therefore the yield and price. Report: Tenants works through the tenant list as a credit portfolio, from who occupies the premises to the financial strength behind each contract.

How this looks in Placepoint

In Placepoint you find this in the property panel:

Tenants in Placepoint

From Placepoint's glossary: Tenants

More information: Lovdata: Husleieloven, Husleietvistutvalget, Store norske leksikon: leie

Norwegian: Leietakere.

Common questions we come across

Who is a tenant?

A tenant is the person or company that, for payment, gains the right to use a property or premises they do not own. The tenancy is governed by the Tenancy Act for homes and by freedom of contract for commercial premises.

Why do tenants matter when valuing commercial property?

Tenant quality is a key factor in the valuation of commercial property. Long-term leases with solid tenants give stable cash flow and low risk, which gives a lower yield and a higher value.

What should a lease for commercial premises contain?

A lease for commercial premises should state the lease term, the rent, how the rent is adjusted (typically CPI-indexed), maintenance responsibility, termination terms and any option to extend.

What is WAULT?

WAULT (weighted average unexpired lease term) measures the average remaining lease term weighted by rent. A high WAULT indicates stable future income and lower risk.

Can I find tenant information in Placepoint?

In the property panel you can see tenants where the data exists. For a broader analysis of an area, you can also use commercial databases such as Proff.no.