Assignment of Lease
Property & Conveyancing
we offer expert legal support during lease assignment
An Assignment of Lease transfers your rights and obligations under your Lease to a new tenant. Essentially, this means you can exit your Commercial Lease earlier than initially agreed by passing it on to someone else. In order to do this, you will require your landlord’s consent. Your Lease may stipulate further requirements which must be fulfilled for the Lease to be assigned.
Once you have obtained consent from your landlord to assign your Lease, you will require a Deed of Assignment and also a Deed of Consent to Assignment. Our team at Burgess Thomson can help in drafting these documents. We can also look over your Lease to ensure you are meeting all the relevant requirements. Additionally, we can help if any hurdles arise, for example if your landlord does not respond to your request for consent or if they do not consent.
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What is a Deed of Consent to Assignment?
This is a document which outlines that the landlord consents to the Assignment of Lease, that the tenant agrees to transfer their interest in the lease to the new tenant, and that the new tenant agrees to assume any rights and obligations the original tenant held as indicated in the original lease agreement.
How can you get the landlord’s consent?
In general, there are a few standard ways to gain the landlord’s consent to the Assignment of Lease. This could be by ensuring that the new tenant has the business skills and financial resources to meet the requirements of the Lease. You may also agree to assist the new tenant in meeting the requirements if it is not initially able to.
What about a retail lease?
Retail leases have more rules surrounding assignment than non-retail commercial leases. If it is a retail lease being transferred, the tenant will typically need to give the assignee a disclosure statement. This statement also includes details of any changes to the disclosure statement that the landlord agreed upon during the term of the lease. The disclosure statement outlines the vital information that the assignee needs to know including:
- Annual base rent under the lease;
- Estimated outgoings payable under the lease;
- Term of the lease and any options to renew;
- Estimated commencement date of the lease;
- Details of the premises; and
- Permitted use of the premises.
If you are a party to a retail lease, Burgess Thomson can help you by informing you of your rights and obligations under the Lease and relevant statutory legislation. This will help you decide whether assignment of your lease is in your best interests.