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Underleases and other Underletting Documents

Some business leases, particularly those with terms over 5 years, permit a tenant to underlet the premises subject to obtaining the landlord’s consent. The landlord’s consent is usually given in a formal licence to underlet.

Before a landlord will give consent he will usually want to be satisfied that the proposed undertenant will be able to pay the underlease rent and generally be a suitable occupier of the premises. However, it is harder for a landlord to object to an underletting than an assignment because the landlord will continue to receive rent from the tenant during the term of the underlease.

Once the landlord’s consent has been obtained, the tenant and undertenant can enter into an underlease. There are underlease templates in our Shops & Restaurants, Offices and Industrial folders. Depending on the term of the underlease, it may need to be registered at the Land Registry.

In this folder we have Letters for tenants seeking consent to underlet the whole or part of the premises, Heads of Terms for underleases and for licences to underlet, Land Registry Form AP1 and Notices of underletting. These documents will help tenants and undertenants to handle a proposed underletting effectively.

Tenants should refer to the Protocol for Applications for Consent to Assign or Sublet when making an application for consent to underlet. The Protocol can be found at http://www.propertyprotocols.co.uk. Compliance with the Protocol is voluntary but the Protocol is widely supported in the commercial property sector. Our documents are designed to help the parties comply with the Protocol.

Underleases and other Underletting Documents is part of Property Documents. Just £35.00 + VAT provides unlimited downloads from Property Documents for 1 year.

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