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Selling your business with a lease, will the landlord have to consent?

commercial property, Commercial property sale, Tenancy Deposits, Uncategorized

 

 

The first step is that you will need to check that the lease can be passed to another third party. Look at the terms  the lease for the assignment of lease clause. Most leases allow for the assignment of the whole, very few allow for the assignment of part of the property.

The assignment clause will generally require that the landlord’s consent to the assignment is obtained. The landlord and you, as the outgoing tenant, will want to ensure that the tenant coming in is off suitable financial standing to pay rents etc. The landlord may put conditions on the licence to assign including:-

1. that you as the tenant passing the lease on, enters into what is called an AGA ( Authorised Guarantee Agreement). This in basic terms is an agreement in which you as the tenant passing the lease on, guarantees that the incoming tenant will comply with the terms of the lease;
2. the landlord will ask that you pay his fees and his surveyor’s fees for  the licence to assign;
3. the landlord if he is not completely satisfied that the incoming tenant is of suitable financial standing may request that the incoming tenant pays a rent deposit.

When you are looking to pass the lease onto a new tenant it is important that you take legal advice at an early stage. I have lots of experience in such matters and would be happy to assist with any questions you may have and if you decide to instruct would provide you with a fixed fee quote for the work.

Christie Limb

climb@fidler.co.uk

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