5 Things to Consider Before Subleasing

5 Things to Consider Before Subleasing

Updated on March 23, 2020

Thinking about subleasing a property sometime in the near future? Here are some tips and things to consider before doing so.

A sublease is a transfer of only a portion of the tenant’s interest in the lease, reserving to the sublessor some reversionary interest. A sublease is distinguishable from an assignment for that reason. This is because unlike a sublessee, an assignee receives the whole of the tenant’s interest and is in privity with the landlord. In contrast, a sublessee is only in privity with the tenant as a sublessor.

As a result, a sublease does not affect the relationship between the original landlord and tenant. Each can enforce the covenants and conditions of the lease against the other, which may affect your sub-tenancy at the property. With that in mind, here are five things you should consider before subleasing a property:

  1. Generally when subleasing, the sublessee is bound by both the terms of a sublease and the terms of the original lease, even though there is no direct relationship between the landlord and the sublessee. Accordingly, it is very important that you obtain a copy of and carefully review the original lease before agreeing to a sublease.
  2. Whether the current tenant is required to and did obtain permission from its landlord to sublease the subject property to you. This is important because without permission from the landlord, both you and the original lessee can be evicted for an unapproved sublease, even if you are current on rent.
  3. Whether the current use under the lease is suitable for your proposed use of the subject property.
  4. Whether the tenant who intends on subleasing the property to you is current on its rent. This is important to ensure that you cannot be evicted along with the tenant for nonpayment of rent or have to pay additional rent to satisfy the original tenant’s arrears.
  5. Whether the tenant is in default for any other breaches of the lease besides non-payment of rent. Again, this is important to avoid a surprise eviction based on the original tenant’s breach of the lease.
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Schorr Law has extensive experience representing clients in connection with leasing and subleasing real property. To see if you qualify for a free 30-minute consultation regarding your matter, please contact us by phone, email, or send us a message through our contact form.

 

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