COVID-19: How to downsize your office space?
If you are a tenant and want to downsize your space, here is what you can do:
1. Are there any break rights coming up in the lease? If so, what are the preconditions that must be satisfied by the tenant to exercise this right? The usual preconditions are:
a. 6 months written notice to the landlord.
b. vacant possession is required which means the property must be empty and free from any belongings and chattels and any rights granted to any third parties such as licences and subleases.
c. up to date payment of rent – the definition of rent can also include service charge or insurance which also must be paid.
2. Agree to surrender part/ whole with the landlord in absence of any break rights. This would usually entail payment of a premium to the landlord and can be costly.
3. Assign or sublet the whole or part of the property. If you are assigning, the landlord may have various requirements that you may have to satisfy such as a requirement for a guarantor and any dilapidations liability. If you are subletting, you may be required to sublet on the same rent/ repair obligations as your lease.
4. Share space with a group company if the lease permits.
For specific advice or if you have any queries regarding the above, please do not hesitate to contact us.