Commercial Lease Assignment
Restaurant tenant wants to sell its business and assign its lease to a person living in a different city. Is the potential new tenant's physical location a valid reason for the landlord to reject the assignment?
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- Charlottesville, VA
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#2 Land & New Construction Contributor
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It all depends on the lease. Typically the landlord has the right to approve any new tenant who purchases the business so they can approve or not approve for any reason.
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#2 Commercial Real Estate Investing Contributor
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Originally posted by @Greg Dickerson:It all depends on the lease. Typically the landlord has the right to approve any new tenant who purchases the business so they can approve or not approve for any reason.
If we want to speculate further, I would contend that a "reasonable discretion" standard would not include out of state residency as a bar. So LL would have to pick another reason for denying. Although, if the Tenant is going to stop paying, they usually want to approve an assignment to keep the cash flow ( assuming a qualified tenant) they don't arbitrarily deny.
