A Practical Guide To Assignment Clauses In Commercial Leasing

In a commercial lease, the assignment provision often receives less attention than headline terms like rent or operating expenses, but it remains one of the most important provisions. Assignment and subletting govern whether, and under what circumstances, a tenant can transfer its leasehold interest to another party. For landlords, the provision is a tool to maintain control over their asset, tenancy mix, and financial health of the property. For tenants, it represents flexibility and an exit strategy. Understanding how these provisions work is essential for both landlords and tenants when negotiating commercial leases.

Landlord Consent Standards in Lease Assignments

At its most basic, an assignment provision in a commercial lease prohibits the tenant from assigning the lease without the landlord's prior written consent. The sophistication comes in how that consent standard is defined.