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Don’t get screwed.</text><text x="58" y="258" font-family="Arial,Helvetica,sans-serif" font-size="30" font-weight="600" fill="#6b5b4d">Leases, TI, NNN &amp; buildouts — negotiated in your favor</text><g transform="translate(1010,86)" fill="none" stroke="#C0531F" stroke-width="9" stroke-linejoin="round"><rect x="20" y="40" width="150" height="130"/><line x1="20" y1="40" x2="95" y2="6"/><line x1="170" y1="40" x2="95" y2="6"/><rect x="50" y="80" width="36" height="36"/><rect x="104" y="80" width="36" height="36"/><rect x="74" y="128" width="42" height="42"/></g></svg>

How Do I Sublease Excess Office Space I'm Not Using?

Direct Answer

If you're sitting on office space you no longer use, subleasing turns a dead cost into partial recovery — but in a soft market expect to recover only 50–75% of your rent, so the goal is to minimize the carry, not break even. Your first move is to read your lease's sublease clause: most require landlord consent "not to be unreasonably withheld," and many contain a recapture right that lets the landlord take the space back instead of approving your subtenant.

The math that matters is the sublease spread — you pay, say, $45/SF on your prime lease, but with the sublease market flooded you may only get $25–$35/SF, so you eat the $10–$20/SF gap. On 5,000 SF that's still $50,000–$100,000/year recovered versus paying full freight on empty space.

The fastest, cheapest sublease wins come from three moves: price it to move (sublease space competes against direct space landlords are discounting heavily, so list 15–30% below comparable direct asks), offer it with existing furniture and built-out (turnkey/"plug-and-play") to attract small tenants who want zero buildout, and keep the term short and flexible.

Watch the traps: you remain primarily liable on the master lease even after subleasing, the subtenant's default is your problem, and you'll pay broker commissions (4–6%) plus possible TI or free rent to close the deal. Get landlord consent in writing, vet the subtenant's credit hard, and structure the sublease to mirror your master-lease obligations so nothing slips through.

Read Your Lease Before You List Anything

You can't sublease space you don't control the right to sublease. Pull the master lease and find:

• Sublease/assignment clause: Does it require landlord consent? The good version says "consent not to be unreasonably withheld, conditioned, or delayed." The bad version gives the landlord sole discretion — fight that interpretation or negotiate it.
• Recapture right: Many leases let the landlord take the space back rather than approve your subtenant — sometimes capturing the profit if your sublease rent exceeds your rent. Know whether this exists before you spend money marketing.
• Profit-sharing: Some leases require you to split any sublease profit 50/50 with the landlord. In a down market you won't have profit, but know the rule.
• Use and signage restrictions: Your subtenant's business must fit the permitted use; conflicting uses can sink consent.

If the clause is hostile, you may need to negotiate an amendment with the landlord — sometimes a lease buyout or "blend-and-extend" is cheaper than carrying empty space. Run that math too.

Decide: Sublease, Assign, or Buy Out

You have three exits, each with different economics:

• Sublease: You stay on the hook to the landlord and become a landlord to your subtenant. Best when you want to recover *some* cost and keep optionality. You bear the spread and default risk.
• Assignment: You transfer the *entire* lease to a new tenant and (ideally) get a release of liability. Cleaner exit, but harder to find a taker for your full obligation, and landlords rarely grant a full release without a strong replacement tenant.
• Lease buyout / termination: You pay the landlord a lump sum to walk. Makes sense if the carrying cost of empty space over the remaining term exceeds the buyout. Typical buyouts run 6–18 months of rent plus unamortized TI and commissions.

Compare the net cost of each over the remaining term. Sometimes paying a buyout now beats bleeding the spread for five more years.

Price It to Move and Make It Turnkey

Sublease space competes against direct space that landlords are discounting with free rent and TI. You can't match their concessions, so compete on price and convenience:

• Price 15–30% below comparable direct asking rents. A sublease at $28/SF next to direct space at $40/SF moves; one priced at $38/SF sits empty for a year.
• Offer it "plug-and-play": leave the furniture, cabling, phones, and built-out conference rooms in place. Small and mid-size tenants will pay a premium to avoid $50–$120/SF in buildout and a 4–6 month construction delay.
• Offer short, flexible terms: subtenants love that a sublease can be 1–3 years when direct leases demand 5–10. Your flexibility is your selling point.
• Be willing to give a little free rent (1–2 months) to close — it's cheaper than 6 months of vacancy.

Every month vacant is 100% loss; a signed sublease at even 60% recovery beats it immediately.

Protect Yourself: You're Still On the Hook

The brutal truth of subleasing: your master-lease liability does not go away. If your subtenant stops paying, you still owe the landlord. Build protections:

• Vet credit hard: require financials, a security deposit of 2–6 months, and consider a personal or corporate guarantee from the subtenant.
• Mirror the master lease: your sublease should pass through all your obligations (use, hours, insurance, surrender) so you're never caught owing the landlord something the subtenant won't cover.
• Require subtenant insurance naming you and the landlord as additional insureds.
• Default and cure rights: short cure periods, the right to re-enter and re-let, and the right to apply the deposit fast.
• Get the landlord's consent in writing as a formal consent agreement — verbal approval is worthless if a dispute arises.

Run the Numbers and Hire the Right Broker

Before you commit, model the net recovery over the remaining term:

• Gross sublease income (rent × SF × term) minus broker commission (4–6%), minus any free rent or TI you give, minus landlord profit-share if applicable = your net recovery.
• Compare against the net cost of a buyout and the net cost of carrying it empty. Pick the lowest.
• Factor the time-to-sublease — flooded markets can take 6–18 months to fill sublease space, so every month of marketing is carry cost.

Hire a tenant-rep / sublease broker who specializes in subleases — they know which direct concessions you're competing against and how to position turnkey space. Commissions are typically 4–6% of total sublease value, well worth it to fill the space months faster. Pair with a real-estate attorney to paper the sublease and the landlord consent agreement so your liability is properly mirrored and capped.

FAQ

Will I make money subleasing my extra office space? In a soft market, almost never — expect to recover 50–75% of your rent because you're competing against direct space landlords are discounting heavily. The realistic goal is loss mitigation, not profit: recovering $25–$35/SF on space you pay $45/SF for still beats paying 100% on empty space.

If your lease has a profit-share clause, any rare upside gets split with the landlord anyway.

Do I need the landlord's permission to sublease? Almost always yes. Most leases require landlord consent "not to be unreasonably withheld," and many include a recapture right letting the landlord take the space back instead of approving your subtenant. Read the sublease clause first, get consent in writing as a formal consent agreement, and never let a subtenant move in on a verbal okay.

Am I still responsible if my subtenant stops paying? Yes. Subleasing does not release you from the master lease — you remain primarily liable to your landlord. If the subtenant defaults, you owe the rent.

Protect yourself with a 2–6 month security deposit, hard credit vetting, a guarantee, and a sublease that mirrors your master-lease obligations so nothing falls through. To fully escape liability you'd need an assignment with a release, which is harder to get.

Should I sublease or just buy out my lease? Compare the net cost of each over the remaining term. Subleasing recovers partial rent but leaves you liable and chasing the spread; a buyout (typically 6–18 months of rent plus unamortized TI and commissions) is a clean exit.

If carrying the empty space and the sublease spread over the remaining years costs more than the buyout, pay to walk. Model both before deciding.

Sources

• CBRE, *U.S. Office Figures / Sublease Availability tracker* — sublease vacancy, spread, and pricing data.
• JLL, *U.S. Office Outlook* — sublease market volume and net-effective-rent trends.
• Cushman & Wakefield, *Office MarketBeat / Sublease analysis* — sublease discount and absorption benchmarks.
• BOMA International, *Office lease and operating-expense guidance* — pass-through and surrender-clause standards.
• IREM (Institute of Real Estate Management), *Income/Expense Analysis: Office Buildings* — operating-cost benchmarks for carry-cost modeling.
• Tenant-rep brokerage advisories (e.g., Savills, Cresa, Colliers) — sublease pricing, recapture, and consent negotiation.
• Commercial real-estate legal guidance (e.g., NAIOP lease-clause references) — sublease, assignment, and recapture clause structure.