Expert View: Matthew Bowen, Director, Aitchison Rafferty, looks at exiting a lease early
PUBLISHED: 08:00 25 October 2016 | UPDATED: 08:13 25 October 2016
A lease usually has provisions allowing the tenant to assign their lease or sub-let the space. These do have restrictions in place, normally requiring landlords consent and the liability sometimes does not end entirely.
A growing route is to instruct a commercial agent to liaise with the landlord to negotiate a surrender of the lease – on the basis of the tenant finding a new occupier on terms which the landlord considers beneficial enough to surrender the lease at the same time as the new one is signed.
The landlord is under no obligation to agree to this, but in a market with rising rents, landlords often look on this favourably as it improves their asset and also can result in a longer term than may currently be remaining. Most landlords do not want to risk losing a tenant if the business fails as their costs can be high. We provide a service to liaise with the landlord, find a new tenant to take on the lease, negotiate the terms and then when agreed, the current tenant can find alternative premises. In some respects this is a win for both landlord and tenant.
There are costs involved though, as the tenant will often be required to pay the agent’s fees and possibly the landlord’s solicitor’s costs, as whilst landlords can be accommodating they will rarely do so at their own cost.
A professional will speak with parties at no initial cost and can liaise with landlords to see what options may be possible at the outset. Aitchison Raffety are specialists in this process.
Matthew Bowen, Aitchison Raffety 01727 843232.