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Our commercial client, a thriving logistics business, approached us for advice on how to terminate their lease. Due to a successful tender they needed to relocate. They had signed a long-term lease at a prime industrial location but due to the advancement of their business, circumstances had changed and they needed an exit strategy fast.
The Problem:
They had missed the opportunity to exercise their break clause and still had five years left on their lease. They would not be able to deliver on the terms of the new contract from their existing premises. The landlord was unwilling to negotiate an early surrender.
Our Solution:
Lease Assignment/Sub-letting: We reviewed the lease and identified that they had the right to assign or sub-lease it to another tenant. We discussed how they could find a suitable assignee and what consents would be needed from the landlord and what conditions the landlord could insist on.
Negotiate an Exit: Due to the buoyant logistics market and demand for the premises we reopened discussions with the landlord, leveraging market conditions and the potential for a stronger tenant to take over. This led to a negotiated lease surrender at a reduced cost.
Outcome:
Our client successfully exited the lease with minimal financial exposure, avoiding potential litigation or long-term liabilities.
Key Takeaway: If you’re in a tricky lease situation, act early and seek legal advice. There are always options. You just need the right strategy!
Does your Business have a lease issue? Contact us today to discuss which strategies would be most suited to your business operations on 0808 172 93 22 or complete our quick contact form for a no obligation discussion!
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This update is for general guidance only and advice should be taken in relation to a particular set of circumstances.
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