Ways to Terminate your Office Lease
Should you wish to terminate your office lease for it expires there may be a number of options available to you.
If you have outgrown your office space sooner than expected or your existing premises are too expensive, an office relocation may be the best option for you. If there is still some time left on the office lease, you need to be aware of your legal options for exiting the lease early in order to avoid disagreement with your Landlord or unnecessary costly legal fees. These might include:
Termination under a break clause
Check your office lease to see whether you have a ‘break clause’ as you may be able to terminate the lease at a specified point.
Terminating Lease without a break clause
If there is no break clause and you still need to terminate your lease early, you may be able to negotiate termination with your Landlord. There may be a fee for terminating early, as well as costs to cover the landlord's legal fees.
Assigning lease to a new tenant
You may be able to find a tenant to replace you and assign the lease to them but you will need the Landlord’s agreement first and a Licence to Assign has to be agreed. There may also be restrictions on Use of the property that limit who you can assign to. Assignment negotiations can be lengthy and costly so if your lease has less than two years to run it’s better to negotiate termination of the lease, to avoid the costs and risks of assigning it.
Sub-letting
Another alternative is to sub-let the premises. You can find a tenant to replace you in order to generate your own rental income. Check your office lease for restrictions on sub-letting. Your liabilities to the Landlord remain the same and you will still be committed to the lease, as well as having the additional burden of managing your sub-tenant.
Ensure you take sufficient steps to minimise risk and get your office lease negotiations right the first time by engaging the help of an experienced Property Solicitor. They will help to explain the terms and obligations within the lease so you are absolutely clear about your retrictions and obligations before signing anything in haste.
Find a good Property Solicitor in your area to advise you on the legal issues when moving office.
