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Subleases

Where a Lease has been granted in favour of a Tenant over a property it will most probably have provisions allowing the Tenant to sell his interest in the whole of the property by way of Assignation or in the whole or part of the property by way of Sublease.

Whereas an Assignation allows the existing Tenant to sell his interest in the property in its entirety and thus ensure that the Tenant no longer has any responsibility or contractual obligation for the property or the Lease a Sublease acts differently.   A Sublease creates a new Tenancy whereby the original Landlord and Tenant relationship remains but a Subtenancy is created.  In such circumstances the Tenant becomes a Midlandlord and the actual occupier of the property becomes a Subtenant.   Where a subtenancy is granted of the whole of the property it is often because the ingoing subtenant is unwilling to take on the full responsibility of the Headlease or has insufficient covenant to satisfy the Headlandlord of their ability to meet the conditions of the Headlease.  Subleases however in some circumstances can be granted for part only of the property, for instance a couple of rooms may be let out to a third party to provide useful additional income for the Midlandlord.  

How We Help Your Business

As with Headleases a Sublease is a complex and often lengthy document.   It is important for all parties therefore that their interest is represented and that there is clear and concise drafting to ensure that what has been agreed or intended between the parties is reflected in the written documentation.    McKay Norwell’s Commercial Department has considerable experience in all aspects of Landlord and Tenant documentation and specifically including Subleases.

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Case Studies

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