Pro's and Con's to Consider Before Subleasing Office Space

Presented by:

Jeffrey S. Weil, MCR.h, SIOR, CCIM 
Senior Vice President
COLLIERS INTERNATIONAL
925.279.5590
jweil@colliersparrish.com

PRO's

• Potentially lower cost space

• Sometimes furniture systems, business equipment, phone systems available at greatly discounted price

• Speed of process - possible to move in literally as fast as paperwork is completed

• Lease already negotiated (sublease terms need not be addressed).  If done by credit tenants or in softer market, may provide advantageous terms and conditions to subtenant

• Possible great parking and signage rights

• Potentially less up-front financial requirements from a sublessor versus an institutional Landlord

            CON's

• Lease terms inflexible, what you see is usually what you get

• Options usually not transferable

• Three parties involved, the Sublessor, Sublessee, and the Landlord.  Allow time for this

• If profit goes to Sublessor, lessor might be resentful

• As-is configuration, no or limited TI's are the norm

• Short-term sublease might result in huge sticker-shock when when it time to get a new direct lease

Note:  We are not attorneys and urge careful review of all contracts by a qualified legal counsel.

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