Austin office space sublease
As a tenant you may want to sublease an office space , sometimes the advantages outweigh the disadvantages of a direct lease. In this blog, we will review the benefits to subleases for an office as well as the disadvantages which there are some believe it or not. So, why does an existing tenant decide to sublease their office space? Typically there are 3 reasons why a sublease comes available. The first reason is out of the control of the existing tenant and that is the economy, if the economy is in a downturn and business cannot stay afloat or have to consolidate they will resort to a sublease. The tenant of the office space may also vacate the office when the economy takes a nosedive but they are still on the hook for the lease, hence the sublease solutions comes into play.
Why Sublease an office?
Second reason an existing tenant may want to sublease an office property is because they are consolidating even if the economy is good, they may have decided to move their offices to another part of Austin or completely move out of the city. The third reason a tenant would want to sublease their office space in Austin would be they can’t carry their business anymore and they cannot pay the rent anymore. When this happens the tenant will engage with a commercial real estate broker to list their office space for sublease.
The benefits to you as a potential sub-lessee (terminology used for someone subletting) is usually the term can be shorter than a direct lease , also you may be able to get into the office property in Austin at a reduced rates. Typically, the tenant wants to be able to sublease their office space at the same rate they are paying so they are net zero when it comes to rent payments per month. The existing tenant becomes your landlord or called the sub lessor in the transaction.
There are distinct disadvantages to a sublease space such as no finish out is usually provided by the existing tenant, therefore you will have to take the space “as is”. Unless there is some type of agreement with the main landlord to provide finish out to a sub-lessee where they would convert to a direct lease after the sublease expires, you can expect no to very little tenant improvements to the office. Also, another disadvantage could be that the sub-lessor who is your new landlord does not pay the direct lease landlord (owner of the office property). Keep in mind you are just stepping in and taking over the lease payments and finishing out their term. The sub-lessor is still on the hook with the landlord for the original lease that executed. Austin office subleases do not typically have signage in front of the buildings, therefore a commercial real estate broker like Shire Commercial is vital in helping you find this type of office property for sublease.