Subleasing is very popular during a down economy. You can find great space at a reasonable price. Subleasing, however, during this economy, can be fraught with peril. If the company from whom you are leasing defaults under its lease, the landlord has the right to terminate the master lease along with your sublease. This problem can arise when the main tenant is paying 20 dollars a square foot and the subtenant is paying 15 per square foot. If the main tenant’s business is struggling and they cannot make up the $5 per square foot and defaults under the main lease, the landlord may or may not want to honor the sublease. You should think twice about a sublease at a lower rate as opposed to a straight lease at a higher rate given this potential scenario.
Related posts:
- Tenant Improvement Allowance and Landlord Defaults, guest post by Justin Daniels, Atlanta Real Estate Attorney
- Your Contract is Your Bond – guest post by Justin Daniels, Atlanta Real Estate Attorney
- Landlord’s Forgetfulness is No Excuse: Tenant Obligated to Pay Lease Expenses – guest post by Justin Daniels, Atlanta Real Estate Attorney
