An assignment of lease, also known as a transfer of lease, transfers the lease form the outgoing tenant to the incoming (new) tenant.
The usual reasons for transferring a lease are as follows:
- You as the tenant have sold your business and as a condition of the sale, the premises need to be transferred to the new purchaser of the business;
- There is some other reason that you want to leave the premises – for example, your business could be growing or contracting and you have found another tenant to take over the lease.
As the outgoing tenant, you need to be sure that your lability is absolutely limited with respect to the new tenant, or better still, that you have no ongoing liability at all. We have seen guarantees by outgoing tenants called in where the new tenant does no succeed and stops paying the rent.
Sometimes, landlords refuse to consent to the new tenant. Most leases will require the landlord to be “reasonable” but landlords can still often refuse a new tenant. We can provide advice and assist existing tenants and new insert full stop after tenants
If you are an incoming tenant, you want to be sure that the lease you are getting is everything you need. It is not uncommon to negotiate varied terms with the landlord – such as more options for further terms. Sometimes, landlords are open to these types of variations.
We regularly provide legal advice to outgoing and incoming tenants in relation to all of the above matters.
Call us today on 1300 907 335 to discuss your scenario. Alternatively, please fill out the contact form on this page for and one of our lawyers will respond to you promptly.
We can assist landlords in assignment of lease scenarios to ensure that the assignment (or transfer of lease as it is commonly known) process and documentation is accurate and otherwise consistent with the existing lease.
In certain circumstances, it may be appropriate to ask for the tenant or guarantors to guarantee the obligations of the new tenant.
We can also assist with the process of helping you assess or refuse a proposed new tenant, noting that landlords typically can refuse new tenants provided there are well articulated reasons for doing so. This is important because it is your asset and the quality of the tenant impacts the value of your asset.
To speak with one of our lawyers call us today on 1300 907 335. Alternatively, please fill out the contact form on this page for and one of our lawyers will respond to you promptly.