What is Sub-letting?
Sub-letting, often termed a sub-lease, is a common mechanism in Scots commercial property which allows a tenant (referred to as the head tenant) to grant occupation of all or part of their leased premises to a third party (the sub-tenant).
Crucially, and unlike an assignation of the lease (where the tenant transfers their lease entirely to a new party), sub-letting does not relieve the tenant of their original lease obligations. The tenant remains responsible to the head-landlord for rent, repairs and compliance with all lease terms—which is especially important if the sub-tenant fails to meet obligations under the sub-lease.
In recent times, sub-letting has become an increasingly beneficial tool for businesses navigating economic uncertainty, rising costs and changing work patterns.