top of page
< Back

Existing Tenant

What exit strategies are commonly used by tenants if required?

When responding to a commercial tenant in the Gold Coast, Brisbane, Northern NSW, or Queensland regions, regarding exit strategies, it's important to consider various options tailored to their specific needs and circumstances. 

Here are some commonly used exit strategies for business tenants in commercial real estate:

  1. Assignment of Lease: This involves transferring the lease agreement to a new tenant. The original tenant may need to seek landlord consent and often remains liable unless released by the landlord.

  2. Subleasing: Subleasing allows the current tenant to lease out part or all of the premises to another party. The original tenant retains responsibility for the lease terms.

  3. Negotiated Termination: Sometimes, tenants negotiate early termination of the lease with the landlord. This could involve payment of a fee or fulfilling certain conditions.

  4. Buyout Clause: Some leases include a buyout clause that allows tenants to terminate the lease early by paying a specified amount to the landlord.

  5. Sale of Business: If the business is being sold, the lease may be transferred to the new owner as part of the sale agreement.

  6. Lease Surrender: This involves the tenant voluntarily surrendering the lease to the landlord. Terms for surrender may involve payment of a penalty or fulfilling certain obligations.

  7. Expiration of Lease: The tenant may choose not to renew the lease at the end of the term, allowing for a natural exit from the premises.

  8. Relocation: In some cases, tenants may need to relocate their business for strategic reasons. This could involve negotiating an early termination or subleasing the current premises while securing a new location.

  9. Default and Eviction: While not an ideal scenario, if the tenant is unable to fulfill lease obligations, the landlord may initiate eviction proceedings.

When discussing exit strategies, it's essential for both the tenant and the landlord to review the lease agreement carefully, understand rights and obligations, and consider the potential financial implications of each option. Additionally, seeking legal and financial advice can help navigate the process smoothly. If you need further assistance or clarification on any of these strategies, feel free to reach out.

bottom of page