What to Consider When Subleasing Office Space

Sublease office space is becoming the main form of office space available. Therefore, it is important to consider the advantages and disadvantages of subleasing office space to see if it makes sense for your business. An advantage to sublease office space is a low rental rate. Most sublandlords have another business besides real estate and are interested in minimizing the expense of their lease. This allows businesses to sublease office space for less money than if they were renting space directly from a building owner. If a sublease is for less than five years then the rents have a heavy discount. Subleasing also offers the advantage of renting out space in a building that the business could not normally afford. You may even be able to find a sublease that
includes furniture and equipment already in the office space.

Yet another advantage of sublease office space is the fact that you can often use the space immediately. This then saves the business time and money that they would normally have to use to design and construct their new office space. One of the biggest disadvantages to subleasing office space is the fact that if a sublandlord defaults on the lease then the business that is subleasing the office space also looses their right to occupy the space. Some building owners even view sublandlord as having bad finances.

When subleasing office space a building owner will often not offer nondisturbance agreements. These are often vital for tenants since they state that if a landlord defaults the lender will continue to recognize the lease with the tenants. In addition, sublease offers very little flexibility with terms. A sublandlord can only offer rights that they themselves have on the lease. Therefore, this limits the term of the lease a business can sign.