There are many different kinds of sublease agreements that can be used, and which one is appropriate for a given situation and set of circumstances is determined by the sublessor (the original tenant) and the subtenant. The following are some examples of frequent kinds of subleases:
Subletting by Portion:
The sublessor retains occupancy of the remaining space in the rented property when a partial sublease is in place. This allows the sublessor to sublease only a portion of the rented property to the subtenant. When the sublessor wants to split the expense of rent or make use of space that is not being used, this arrangement is widely used.
Complete Rental Agreement:
When a sublessor sells their entire leasehold interest to a subtenant, this transaction is referred to as a whole sublease. In this scenario, the subtenant obtains full possession of the property and is responsible for fulfilling all of the rights, responsibilities, and obligations that were described in the initial lease agreement.
Sublease with a Fixed Term:
The property is rented out to the subtenant for a predetermined amount of time, which often corresponds to the amount of time that is left on the underlying lease. This type of sublet is known as a fixed-term sublease. When the term of the sublease comes to an end, the subtenant is required to evacuate the property in accordance with the primary tenant’s obligations under the primary lease.
Sublease on a Month-to-Month Basis:
In a sublet that is paid on a month-to-month basis, the sublessor and the subtenant engage into an agreement that does not contain a specific termination date. The sublease will remain in place on a month-to-month basis until and until either party provides the other with the appropriate termination notice in order to end the agreement. This kind of sublet gives both parties more leeway in their schedules.
Assumed Terms of the Sublease:
When a subtenant takes over the lease agreement from the sublessor, this is known as an assumed sublease because the subtenant is legally responsible for complying with all of the terms and conditions of the lease just as if they were the original tenant. In most cases, the landlord must provide their permission for the transfer, and once that happens, the subtenant takes full direct responsibility for the rent payments and any other lease responsibilities.
Sublease with a Sandwich:
The sublessor will sublease the property to a subtenant while they are still a tenant themselves under the principal lease. This arrangement is referred to as a sandwich sublease. The sublessor fulfils the obligations of a subtenant to the primary landlord while also exercising the rights of a landlord towards the subtenant. In this capacity, the sublessor functions as both a subtenant and a sublessor.
The Master Lease and Each Individual Sublease:
A master lease and sublease agreement takes place when the sublessor is in possession of a master lease with the landlord. This gives the sublessor the authority to sublease the property to a number of different subtenants. The sublessor is considered the primary tenant of the property and is responsible for managing as well as subleasing the space to additional tenants who are bound by their own individual sublease agreements.
It is imperative that local laws, rules, and the terms of the first lease agreement be taken into consideration before engaging into a sublease arrangement. Always seek the advice of an experienced legal practitioner to verify that you are in compliance with all applicable legislation and to assist you in drafting a sublease agreement that safeguards the rights and interests of both the sublessor and the subtenant.
