Many commercial leases contain an express provision that the landlord must consent to the property's sublease or assignment if it is reasonable. This provision is known as an approval clause. The purpose of an approval clause is to protect the tenant against liability for damages or risk of forfeiture, if the consent of the landlord is improperly withheld. Generally there has to be reasonable commercial objections for a landlord to withhold consent.
What are Reasonable Commercial Objections?
A landlord may withhold consent for a sublease or assignment based on a number of factors:
Subtenant's suitability for the particular locale
Subtenant's suitability for the particular building
Legality of the proposed use
Nature of the occupancy and whether the proposed use is materially different from the use specified in the original lease
Original tenant's failure to pay rent
Do I Need a Lawyer if There are Problems With My Commercial Sublease or Assignment?
Commercial real estate is complex and often a commercial lease is drafted by an experienced real estate attorney. Whether you are the landlord who owns a commercial building and object to a sublease or assignment, or a commercial tenant who faces a landlord objecting to your sublease or assignment, a lawyer will be able to help you determine your rights and obligations.