Which statement correctly describes an attornment clause?

An attornment clause is a provision in a lease agreement that specifically obligates the tenant to recognize and accept a new property owner as the landlord if the property is sold or transferred. This clause ensures a seamless continuation of the lease agreement, regardless of any changes in property ownership. When the property is sold, the new owner typically wants to maintain the current leases, and the attornment clause facilitates that by requiring the tenant to continue performing their obligations under the lease, including the payment of rent.

This mechanism is crucial in real estate transactions because it provides certainty to both the seller and the buyer regarding the rights and responsibilities associated with existing tenants. It effectively safeguards the rights of the new owner by confirming that the tenant will honor the terms of the lease, promoting stability in rental incomes for the purchaser.