Contract Glossary
Lease Assignment
Definition
The transfer of a tenant's entire remaining lease to a new tenant. Unlike subletting, an assignment transfers all rights and obligations, the original tenant typically drops out entirely. The new tenant (assignee) takes over the lease directly with the landlord, though the original tenant may remain liable as a guarantor.
In Practice
You signed a 5-year commercial lease for office space. Two years in, your startup gets acquired and you need to relocate. Rather than breaking the lease (which could cost 6-12 months' rent as a penalty), you find another company willing to take over your space. You assign the lease to them. The new company pays rent directly to the landlord. But read your lease carefully, most require the landlord's written consent before assignment, and many commercial leases say the original tenant remains secondarily liable if the assignee defaults.
Example Clause
Tenant shall not assign this Lease or any interest herein without the prior written consent of Landlord, which consent shall not be unreasonably withheld. Notwithstanding any assignment, Tenant shall remain jointly and severally liable for all obligations under this Lease unless Landlord agrees in writing to release Tenant from further liability.
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