Understanding Subleases: A Comprehensive Guide

A sublease, like a lease, is an agreement to allow a person or company to occupy real estate in return for regular rent payments. In a sublease, the tenant leasing from the original landlord in turn leases it to another tenant, who then occupies the property or part of it.

The Right to Sublease

With the landlord's consent, a tenant generally has the right to sublease a house or apartment to another party as long as the original lease remains in force, and the sublease agreement doesn't violate the original lease. If pets are prohibited under the lease, for instance, they can't be allowed by the sublease. In the case of commercial property, the tenant's right to sublease generally must be spelled out in detail in the original lease.

The Sublandlord

The tenant who leases the property to another tenant is called the sublandlord, while the other tenant is called the subtenant.The sublandlord has most of the same obligations to the subtenant as the landlord does to him. If the subtenant has a problem with the property, the sublandlord--not the landlord--must deal with it. The risk for the sublandlord is that if the subtenant fails to pay rent or destroys anything, the sublandlord is responsible.

The Subtenant

Subtenants have similar obligations to the sublandlord as tenants do to a landlord, especially the timely payment of rent and refraining from damaging the property. There is a special risk involved in being a subtenant, however. If the sublandlord's lease with the original landlord is terminated for any reason, so is the sublease--regardless of whether or not the subtenant was involved in the termination.