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Alex J.
Alex J., Solicitor
Category: Law
Satisfied Customers: 3497
Experience:  Solicitors 2 years plus PQE
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How long to sell/assign existing business lease to another

Customer Question

How long to sell/assign existing business lease to another company. Also what do I need to get from the landlord . does the landlord have to do credit check on the new buyer .
thank you
Submitted: 1 year ago.
Category: Law
Expert:  Alex J. replied 1 year ago.
Hi thank you for your question and welcome. My name is ***** ***** I will assist you. Does the lease say you need he landlords consent to assign it? Kind regards AJ
Customer: replied 1 year ago.

Hi

Yes it does

Thanks

Expert:  Alex J. replied 1 year ago.
Hi. Thank you - you will need a formal consent from the landlord and will probably have to pay his costs of doing so. Does it say "such consent not to be unreasonably with held or delayed?
Customer: replied 1 year ago.

Hi




Thank you for you reply it say that in the lease. I have scanned the pages that covers that , Also I copied the part that covers underletting .


would you please be so kind to explain to me if I am allowed to Sublease or Sublet. I would like to know all my option



Thank you in Advance




Zayad



13- ASSIGNMENTS


133-1 The Tenant shall not assign the whole of this lease without the consent of the
Landlord, such consent not to be unreasonably withheld-


182 The Tenant shall not assign part only of this lease.


18.3 The Landlord and the Tenant agree that for the purposes of section 19(1A) of the
Landlord and Tenant Act 1927 the Landlord may give its consent to an aSSlQnment
subject to all or any of the following conditions:


(a) a condition that the assignor (and any former tenant who because of section
11 of the Landlord and Tenant (Covenants) Act 1995 has “0t been release‘j
from the tenant covenants ofthis lease) enters into an authorised guarantee
agreement which:
(i) is in respect of all the tenant covenants of this lease;
(ii) is in respect of the period beginning with the date the assignee
becomes bound by those covenants and ending on the date when
the assignee is released from those covenants by virtue of section 5
of the Landlord and Tenant (Covenants) Act 1995; ‘
(iii) imposes principal debtor liability on the assignor (and any former
tenant);
' (iv) requires (in the event of a disclaimer of liability under this lease) the
' assignor (or former tenant as the case may be) to enter into a new
tenancy for a term equal to the unexpired residue of the Contractual
Term; and
(v) is othenivise in a form reasonably required by the Landlord; and
(b) a condition that a person of standing acceptable to the Landlq" enters into
a guarantee and indemnity of the tenant covenants of this lease in the form
reasonably reqUIred by the Landlord (but with such amendments and
additions as the Landlord may reasonably require).


18.4 The Landlord and the Tenant agree that for the purposes of section 19(1A) of the
Landlord and Tenant Act 1927 the Landlord may refuse its consent to an assignment
if any Annual Rent or other money due under this lease is outstanding.



19. UNDERLETHNGS _
19.1 The Tenant shall not underlet the whole of the Property excel?t in accordance With .
this clause 19 nor without the consent of the Landlord, such consent not to be g:
unreasonably withheld.
19.2 The Tenant shall not underlet part only of the Property save that the Tenant may
underlet the self—contained residential accommodation within the Property on an
assured shorthold tenancy in the occupation of one family at a market rent and for a
term not exceeding twelve months
19.3 The Tenant shall not underlet the Properly: 3
(a) together with any property or any right over property that is not included :
within this lease
(b) at a fine or premium or reverse premium :
(c) allowing any rent free period to the undertenant that exceeds the period as ‘
is then usual in the open market in respect of such a letting
(d) without the Tenant having first procured that the prospective undertenant .
has entered into such confidentiality undertakings with the Landlord ’
regarding the proposed underlease that the Landlord may in its absolute -
discretion require
19.4 The Tenant shall not underlet the Property unless. before the underlease is granted,
the Tenant has given the Landlord:
(a) a certified copy of the notice served on the undertenant. as required by
section 38A(3)(a) of the 1954 Act, applying to the tenancy to be created by
the underlease; and ;
(b) a certified copy of the declaration or statutory declaration made by the
undertenant in accordance with the requirements of section 38A(3)(b) of the
1954 Act. I
19.5 Any underletiing by the Tenant shall be by deed and shall Include: .
(a) an agreement between the Tenant and the under-tenant that the provisions
of sections 24 to 28 of the 1954 Act are excluded from applying to the ‘
tenancy created by the underleasa; '
(b) the reservation of a rent which is not less than the full open market rental L
value the at the date the Property is undertgt and which is ‘ payable at the same times as the Annual Rent under this lease (but this
shau not prevent an underlease providing for a rent-free period of a length
permitted by clause 19.3(c)):


to) provisions for the review of rent at the same dates and on the same basis
as the review of rent in this lease, unless the term of the underlease does
not extend beyond the next Review Date;


(d) a covenant by the undertenant, enforceable by and expressed to be
enforceable by the Landlord (as superior landlord at the date of grant) and
its successors in title in their own right, to observe and perform the tenant
covenants in the underlease and any document that is supplemental or
collateral to it and the tenant covenants in this lease, except the covenants
to pay the rents reserved by this lease;


(e) provisions requiring the consent of the Landlord to be obtained in respect of
any matter for which the consent of the Landlord is required under this
lease; and


(f) in the case of an underlease that is not substantively registrable at H M.
Land Registry, a covenant by the undertenant not to register any notice of
the underlease at H. M. Land Registry,


and shall otherwise be consistent with and include tenant covenants no less onerous
(other than as to the Annual Rent) than those in this tease and in a form approved by
the Landlord, such approval not to be unreasonably withheld.


LG In relation to any underlease granted by the Tenant, the Tenant shall:


(a) not vary the terms of the underlease nor accept a surrender of the
underlease without the consent of the Landlord, such consent not to be
unreasonably withheld;


(b) enforce the tenant covenants in the underlease and not waive any of them
nor allow any reduction in the rent payable under the underlease;


(0) ensure that in relation to any rent review the revised rent is not agreed
without the approval of the Landlord, such approval not to be unreasonably
withheld; and


(d) where the underlease is not substantively registrable at H. M. Land
Registry, not register or agree to the registration of any notice of the
underlease.

Expert:  Alex J. replied 1 year ago.
Hi
Thank you.
You can assign or sublet but you need the landlords consent to do so.
Before you decide which is best, ***** ***** looking for a clean break from the situation?
Kind regards
AJ
Customer: replied 1 year ago.

Hi

Thank you for you reply, I am trying to get clean break .I have two interested buyers is just the price they are offering . is just the price they are offering is quite low if I can transfer in couple of weeks then I might be left with some money after paying debts if it takes months then probably won't be left with any

Thanks

Thank you

Expert:  Alex J. replied 1 year ago.
Hi, Thank you. I think then really you need an assignment to gain a clean break. The conditions say that any person the lease is assigned to may have to sign a guarantee and indemnity of the landlords covenants. Are your proposed buyers sound financially? Kind regards AJ
Customer: replied 1 year ago.

Hi

He is very sound , but he asked me to speak to the lanlord and ask him if he wants to sell the free hold before he makes me an offer is this normal ?

thank you

Expert:  Alex J. replied 1 year ago.
Hi, Thank you. That is slightly different issue. This is not irregular, but the landlord may ask why you are asking this question and you will have to tell him you are thinking of assigning the lease. How long is the lease? Kind regards AJ
Customer: replied 1 year ago.

Hi

I have spoken to the landlord , he sent me this email

1. Should you wish to assign the lease then that should not be a problem subject to the suitability of the assignee and references

2. As you are assigning the lease then we will expect you to pay our legal fees

He said if they are interested in the freehold they need to call him.

The lease is 10 years protected I have 6 years left

Kind Regards

Zayad

Expert:  Alex J. replied 1 year ago.
Hi,
Thank you.
That is all perfectly reasonable. His legal fees should cost about £1500 plus VAT depending on where he is based.
Will your buyer only accept the assignment if he is able to purchase the freehold as well?
Kind regards
AJ

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