Encyclopedia
Sublease
Renting part or all of your leased space to another tenant while staying on the lease.
For example: A tenant subleases unused space. (Illustration only, not a real deal.)
Official source: Commercial Tenancy Act (BC Laws)
Example only, not a real client. Say your team shrinks and you sublease half of your office to another firm. You stay the tenant and remain responsible to the landlord, so you choose a subtenant with solid finances and a sublease that mirrors your lease.
What I’d tell a friend
If you sublease, you usually stay responsible for the whole lease. Choose the subtenant carefully and get the landlord’s consent in writing.
Why it matters to you
You stay responsible to the landlord if your subtenant stops paying or damages the space. Choose subtenants carefully and get the landlord's consent if the lease requires it.
How to use it in your deal
Tenants should check the lease's subletting clause; most require landlord consent, often not to be unreasonably withheld, and some let the landlord take back the space or share profit instead. Ask for consent in writing before signing a sublease. Remember you're still liable for rent and obligations if the subtenant defaults, so screen subtenants carefully and get security.
Subtenants should read the head lease, since their rights depend on it; if the head lease ends, the sublease usually ends too. Ask for a non-disturbance agreement from the landlord if possible. Landlords should review subtenants' use, finances and insurance. Subleases are often cheaper than direct leases because the tenant wants to cut costs, which makes them useful for growing businesses.
Check what furniture and cabling come with the space, who handles repairs, and whether the subtenant can renew; usually it can't beyond the head lease. Put any profit sharing in writing.
Mistakes I see
Subleasing without consent. Subtenants not reading the head lease. Not keeping security.
In BC and Vancouver
Lease terms and the Commercial Tenancy Act govern; case law is on CanLII.
Official sources: Commercial Tenancy Act (BC Laws) · CanLII (court decisions)
Sublease versus assignment
In a sublease, you stay the tenant and rent part or the whole of the space to someone else. In an assignment, the new tenant steps into your lease.
A sublease can end before your lease does, which gives you flexibility. It also means you manage the subtenant.
What landlords may ask for
Many leases need consent to sublease, and some let the landlord take back the space instead. Some ask to share any profit if the subtenant pays more than you do.
Read your lease first, then plan the offer. Check with a BC lawyer on your rights.
Questions to ask before you sign
- Is consent required?
- What does the head lease say?
- Who's liable?
- What if the head lease ends?
Keep reading
Related terms: Assignment (lease), Recapture clause
Working through this right now? Questions are free. Book a 15-minute call or call or text 604 256 2002, and I’ll give you a straight answer.
Back to the A–Z index · common questions · tactics to watch for · the shorter glossary
General information for British Columbia only. It isn’t legal, tax, accounting or financial advice, laws and rates change, and reading it doesn’t make you my client. Any numbers or scenarios are hypothetical. Check the linked official source and talk to a lawyer, accountant or other qualified professional before you act or sign anything. See the terms and disclaimer.