If you have read any news lately regarding commercial real estate, especially in Houston, you have seen a continued rise of sublease space on the market.
Since the oil crash began millions of square footage of office space that oil companies and their servicers occupied have flooded the market. BP has an entire building for sublease on the market right now. As a small business you are frugal with your budget for office space rent. A sublease could be a great option, but here are some things to know.
A common question SwiftLease agents get from their clients is why won’t a company such as BP who has a whole building for sublease divide a space to 1,000 SF for a small business looking to lease space. For years, Landlords especially when developing new buildings won’t divide down space. The small space that exists in those is left over from a large tenant who didn’t lease the whole floor. The costs that go into dividing the space is one thing, and also if someone comes in and leases 1,000 SF of a 24,000 SF suite it doesn’t make much impact on their bottom line.
What is the difference between Sublease and Assignment?
A sublease is where a third party Tenant subleases from the Master Tenant. A new sublease document is signed between the two parties, and needs consent from the Landlord. The Master Tenant is responsible for rent collection from the new third party Tenant.
An assignment of a lease is a complete transfer of the right to the new Tenant, and that Tenant has a direct relationship with the Landlord. However, unless Landlord agrees the original Tenant is still liable if the new Tenant defaults.
What are the benefits of a sublease?
– Below market rent
– Shorter lease terms
– Furniture Included (sometimes)
Do large Tenants have a few extra offices they are not using small businesses could share?
Throughout the years of helping small businesses find office space SwiftLease has discovered a new platform called – SpaceShare. We will play match maker between Tenants who have too much space, such as a few extra offices, to small business looking to lease small office space. If you are interested in learning about SpaceShare opportunities please give us a call today at 713-623-2487 or email [email protected].
SwiftLease is a commercial real estate agency that specializes in helping entrepreneurs and small businesses locate and lease the best office space for their business. When looking for office space you should always have a Broker represent you. See the previous blog post talking about the Importance of a Tenant Rep Broker. Call a SwiftLease Broker today for help 713-623-2487 or email [email protected].