DLS COMMERCIAL · REAL ESTATE · NYC OFFICE LEASING · MARKET INTELLIGENCE · 2026
Commercial Real Estate Good-Guy Guarantees
Guarantor’s liability shall end on the date Tenant vacates and surrenders the Premises, provided Tenant has given the required notice and paid all rent through that date.
A good-guy guarantee (GGG) is a limited personal guarantee in New York City office leases. The GGG is commonly referred to as an anti-squatting clause. Essentially, if the company is no longer willing or able to pay rent, it gives notice and surrenders the space, and the guarantor’s personal liability ends.
The following sections break down what the GGG does, the release conditions and common misconceptions, then measure the guarantor’s exposure and close with how some landlords juice up the GGG.
What the GGG Does
A good-guy guarantee, or GGG, is typically signed by a principal of the company. The landlord’s message is simple: if you can’t pay rent anymore, be a good guy and give us the space back.
A vacant space can be re-let and start earning rent again. A tenant that stops paying and does not move out forces the landlord to go to court and have the tenant legally removed, which takes time and runs up attorney’s fees, with no rent coming in the whole time.
The GGG puts more of the tenant’s skin in the game. If the company squats, the landlord can pursue the guarantor personally until the guarantor has met the terms of the GGG. In its purest form, the GGG requires only a brief notice period, then moving out and handing over the keys. After that, the guarantor’s liability for future rent ends, even with years left on the lease.
Example · Two Outcomes
The Release Conditions
The typical GGG form releases the guarantor once the notice period has ended, the company has fully moved out and surrendered the space, and any rent due to the date of surrender has been paid.
Example · Release Date
Release date = notice period ends + space surrendered + rent paid to date of surrender
Good-Guy Guarantee Misconceptions
A GGG is not a full personal guarantee. A full personal guarantee backs the rent for the entire term.
The GGG limits the guarantor. It does not end the lease. The company stays liable for the remainder of the term, and the landlord can still pursue the company for that rent.
Example · After Surrender
Measuring the Exposure
The clearest number is the notice period. If the company can’t pay, the guarantor funds the rent until the release date. Monthly rent × months of notice = the rent the guarantor backs.
The notice period usually runs three to six months. For example, a company leases 5,000 square feet at $72 per square foot ($30,000 a month in base rent). At $30,000 a month, 90 days is $90,000 and six months is $180,000. Every 30 days cut from the notice period takes $30,000 off the guarantor’s exposure.
Example · Notice Exposure Formula
Monthly Rent × Months of Notice = Guarantor’s Exposure
Notice Period Exposure Model
| Notice Period | Months of Rent | Guarantor’s Exposure |
|---|---|---|
| 90 Days | 3 | $90,000 |
| 120 Days | 4 | $120,000 |
| 180 Days | 6 | $180,000 |
When the GGG Is Juiced Up
Some landlords juice up the GGG by adding exposure beyond rent through move-out. The most common add-ons are reimbursement of the unamortized concessions and leasing costs the landlord paid up front (the tenant improvement allowance, the free rent, and the brokerage and attorney fees). The landlord recovers those costs through rent over the lease term, so a company that leaves early leaves part of the landlord’s capital unrecovered, and the add-on makes the guarantor cover that balance.
That can multiply what the guarantor signs up for. A juiced-up GGG has to be negotiated so it works for both sides, and that starts with knowing the number.
Example · Same Lease, Two Versions of the GGG
The same lease: $30,000 a month in base rent on a ten-year term, 120-day notice. The landlord’s up-front costs are $250,000 in improvements ($50 PSF), $180,000 in free rent (six months) and $120,000 in brokerage and attorney fees: $550,000, recovered straight-line over 120 months. A company that leaves after 36 months leaves 84 of 120 months unrecovered: $385,000, plus $120,000 of base rent for the notice period.