The Importance Of Reviewing Assignment and Subletting In A Commercial Property Lease

Commercial property leases are long and involved documents. They are also extremely important contracts that needs to be read, understood and carefully considered. When you hire the services of our commercial property lease solicitors you can assure that every single part of the lease is understood. Once part of the commercial property lease that you need to carefully consider is the assignment and subletting part.

In this blog post our commercial property lease lawyers look at the importance of reviewing the assignment and subletting parts of the commercial lease. This will help you better protect your business and understand the lease.

All parties will need to consider if the lease can be assigned or sublet. In many cases, tenants will want to be able to assign or sublet the lease. This is because it allows them to ‘get rid’ of the lease is circumstances were to change. However, the landlord will usually want to restrict the conditions in which the tenant can assign or sublet the lease. This is so the landlord is able to maintain control over who is in their building. It also means that they can ensure that the commercial property rent will continue to be paid.

There will need to be certain things in place for the landlord to approve the disposal of the lease. These will be standard provisions which you may see are included in your commercial property lease. They are things that, as a tenant, you will need to abide by.

For example, your commercial property lease may state that assignment and underletting will only be able to take place for the whole demised property rather than just a part. It may also state that the landlord needs to provide consent for the transaction. This is usually only possible for the landlord to refuse in reasonable circumstances.

The commercial property lease for assignment and subletting may also state that the tenant signs an AGS. This is also known as an Authorised Guarantee Agreement and must be completed upon approving the assignment or under lease. The AGA ensure that is the person who takes over the lease becomes unable to meet their responsibilities and obligations then the original tenant is bound to undertake them.

Need a commercial property lease solicitor to review the assignment and subletting requirements in your lease? Call our commercial property lease experts now and see how we can help you.