A commercial lease is a written contract to rent specific property or space for a specific time. When a commercial lease contains a sublease clause, the tenant may choose to sublet the premises to another tenant. In a sublease, the original tenant is sometimes referred to as the master-tenant, and the original lease is known as the prime lease. If you are considering entering into a sublease agreement, be sure you know the answers to the following questions before you sign.
1. Does the master-tenant from whom you wish to rent the property have the authority to do so? The prime lease agreement controls whether the master-tenant can sublease the property. If sublease is allowed by the prime lease, the landlord or property owner may have retained the right to approve a proposed sublease.
2. What rights does the master-tenant have under the original lease agreement? A subtentant’s rights usually depend on the master-tenants rights, so if the master-tenant’s rights are terminated under any clause in the prime lease, then the subtenant’s rights will also be terminated. A subtenant is generally required to follow the same terms and conditions as the master-tenant, so be sure to carefully review the terms in the prime lease.
3. Who usually signs a sublease agreement? A subtenant’s contractual relationship is with the master-tenant, and the subtenant does not have a direct contractual relationship with the landlord.
4. Who will pay for necessary repairs? A subtenant normally rents property in “as is” condition. The Master-tenant is not responsible for repairs, and the landlord does not have to make repairs because, again, the landlord has no contractual obligation to the tenant.
5. Who is liable for property damage during the sublease? The landlord can hold a subtenant responsible for damage to the property under basic property law.
Like signing any lease, signing a sublease agreement means you agree to be bound by its terms. If the space you need to rent can only be secured by a sublease agreement, read the prime lease and the sublease very carefully. Be sure to consult with an attorney experienced in Pennsylvania business law before you sign.
The attorneys at the Scolieri Law Group, P.C. can review your situation and help you compare options. Located in western Pennsylvania, our attorneys are experienced in Pennsylvania business law and can take care of the details for you every step of the way. Contact us today at (412) 765-0546 or via email at info@scolierilaw.com.