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Subleasing (or subletting) commercial real estate has become rather popular over the past few years for a number of reasons. It is the act of a third-party partaking in the lease transaction; the sublessee takes over a tenant's rights and obligations for a certain space until the master lease expires. Though the third-party becomes a new lessee, the primary tenant is liable (to the landlord) for damages caused by the sublessee. The original lease must contain provisions allowing subleasing, in order for one to pursue such a venture.


Generally, property is subleased when one needs to move quickly, or, perhaps, realizes that a long-term contract isn't beneficial (if your business is likely to rapidly outgrow a specific space). One of the large advantages of subleasing space is its availability below market rates. Generally speaking, the shorter the sublease terms, the lower the rate. Be aware that in a sublease situation, you may not be able to stay in the space beyond the expiration of the term. If you can, a "rate shock" might be imminent at lease termination. Though at times extremely beneficial, subleasing commercial property clearly has several drawbacks.


If one is leaning towards short-term leasing, Executive Suites and Virtual Offices may be of interest.

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