What Is a Commercial Lease Assignment?

A resident of Houston, Texas, David Guion has over 20 years of experience in commercial real estate law. He currently serves as an executive managing director, tenant representation at the Houston offices of Cushman and Wakefield. Part of David Guion’s responsibilities at Cushman and Wakefield include representing tenants in lease renewals and commercial lease assignments.

A commercial lease assignment happens when a current tenant transfers their existing lease to a new tenant before the lease term ends. The transfer usually occurs if a tenant wants to exit an existing lease and has found someone willing to take it over. A lease assignment can also happen if a tenant has sold their business, and the new business owner agrees to continue with the existing lease agreement instead of entering a new one with the landlord.

In a lease assignment, the person wanting to transfer the lease is referred to as the assignor. The person taking over the lease is an assignee. Once a commercial lease assignment is done, the assignee will be responsible for things such as paying rent, property maintenance, and security. Most leases forbid tenants from assigning their lease without consent from the landlord.