Can you surrender a commercial lease?

There is no obligation on a landlord to accept a surrender of a commercial lease and landlords will often only do so if there is a benefit in getting possession of the property back early. Alternatively, the landlord may require a premium to be paid by the tenant in return for which the landlord will agree a surrender.

How do you cancel a commercial lease agreement?

Can you back out of a commercial lease early? You can, but generally, you need your landlord’s consent to. This may present itself as an early termination clause, or you can negotiate a surrender of the lease with your landlord. There would usually be some kind of exit payment involved.

Can you cancel a business lease early?

Although it is possible to cancel a commercial lease prematurely, it does not come without its own set of implications. Should a tenant cancel a lease early, he or she will be liable to pay any amount still owed to the landlord in terms of the agreement and up to the date of the cancellation.

What does it mean to surrender a commercial lease?

The surrender of a lease is a mutual agreement between the landlord and tenant to bring a commercial lease to an end prematurely, thus transferring the property back to the landlord’s interest.

Who is the subtenant when you surrender a lease?

The tenant of the underlease or sublease, known as the subtenant, will now become the tenant of the landlord under the terms of the underlease or sublease. Therefore, landlords need to be wary of any subleases when surrendering the original lease as the terms set out in the sublease may be unfavourable to the landlord.

Can a lease be surrendered without a deed?

If the landlord and tenant agree that the lease will be surrendered and they act in a way that is inconsistent with the lease continuing, the lease will be surrendered ‘by operation of law’. Surrendering without a formal deed is quicker and cheaper but it can create uncertainty about what both sides intended.

What is the surrender of lease by lessee clause?

SURRENDER OF LEASE. The voluntary or other surrender of this Lease by Lessee, or a mutual cancellation thereof, shall not work a merger, and shall, at the option of Lessor, terminate all or any existing subleases or sub tenancies, or may, at the option of Lessor, operate as an assignment to him of any or all such subleases or sub tenancies.