This would allow you to continue honoring the rental agreement without having to continue paying for a property that you no longer need to occupy. Another situation may be that your business has not grown at the rate you initially expected, leaving you with some office space sitting empty. Rather than letting that valuable space go to waste, you could sublet it to a smaller business and collect rent on it.
Solutions like PivotDesk connect businesses who have excess office space with those companies who are looking for a few desks. Ideally a landlord wants their properties to always be occupied by reliable renters who pay faithfully each and every month.
But if a tenant is unable to complete the lease term and another tenant has to be found, this can cost the landlord in everything from real estate broker expenses to lost revenue from the time the property is unoccupied.
Therefore, if an existing tenant is able to bring in a subtenant to continue paying rent for the rest of the lease term, that is likely a better situation for the landlord as well. In commercial real estate, the landlord is almost always aware that the tenant is subletting the space to a subtenant.
If not, the situation is usually described as an illegal sublet — but this most often happens in residential real estate. The subtenant will need to abide by the same rules in the original lease as the tenant, since the terms of that lease are essentially still in effect. While the original rental agreement signed between the landlord and the tenant is still valid for the property being leased, a new sublease agreement should also be signed between the tenant and the subtenant.
They will be able to give you advice and to ensure that you enter the agreement fully understanding all of the potential pros and cons. SquareFoot is a new kind of commercial real estate company. Our easy-to-use technology and responsive team of real estate professionals delivers the most transparent, flexible experience in the market. Get in touch to start your search today.
If you are renting a commercial office space, at some point, you will have to think about whether you want to renew your lease or move offices.
A future lease Another aspect of subletting that may be extremely frustrating is when maintenance problems arise the subtenant must go through the primary tenant, who then goes to the landlord.
This whole process can take a very long time, especially if the primary tenant or landlord is not willing to cooperate. Ultimately, the decision should be made on a situational basis and has to be the right decision for you. The main disadvantages of renting are the commitment and formality of the whole process.
Conversely, the main disadvantages of subletting are the lack of commitment and the informal, sometimes haphazard processes that go along with that. As a guide, seasonal internships or moves motivated by finding a fresh perspective might sway towards sublets. For the majority of other situations, if you can commit to a month lease, renting will be more affordable and provide you with more security.
Should You Sublet or Rent? Copy link. Search Doorsteps to find apartments for rent nearby and nationwide. Jamie Friedlander is a freelance writer and editor who can usually be found traveling, drinking copious amounts of green tea or surfing Etsy in her free time.
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