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The CRE Almanac

Assignment vs. Sublease

Published 2026-08-11

An assignment transfers the tenant's entire remaining interest in its lease to a new tenant, who steps into the lease and deals with the landlord directly; a sublease carves out part of the space or term, with the original tenant staying on the lease and acting as the subtenant's landlord. In both structures the original tenant typically remains liable to the landlord unless it is expressly released.

The structural difference

An assignment is a substitution: the assignee takes over the lease for the rest of the term and pays rent straight to the landlord, usually signing an assignment and assumption agreement, with the landlord's consent documented alongside. A sublease is a lease within a lease: the subtenant's rights exist only under the prime lease, the prime tenant keeps paying the landlord, and the subtenant pays the prime tenant. That layering is the subtenant's core risk — if the prime lease terminates, the sublease generally falls with it, which is why larger subtenants ask the landlord for a recognition (or non-disturbance) agreement.

What the transfer clause controls

  • Consent standard — from sole discretion to consent not to be unreasonably withheld, with the middle ground defined by negotiated reasonableness factors.
  • Permitted transfers — affiliates, mergers, and sales of the tenant's business are often carved out from consent entirely; change-of-control language can quietly sweep equity transfers into the definition of an assignment.
  • Recapture — many leases let the landlord respond to a transfer request by taking the space back instead of consenting.
  • Profit sharing — landlords frequently take a negotiated share of any rent premium or consideration the tenant earns on the transfer.
  • Use restrictions — the transferee inherits the lease's use clause, and in retail must also clear the center's exclusives.

The liability tail is the piece operators most often underestimate: an assignor that was never released can be pursued years later if the assignee fails, and guaranties do not necessarily fall away just because the lease changed hands.

In your documents

A single tenancy can accumulate a chain of paper — lease, amendments, consent to assignment, assumption agreement, subleases, guaranties — and questions about who is liable, or what the consent standard is, depend on reading the chain in order. Lease analysis with source-linked answers lets you follow that chain across the portfolio, with each answer tied back to the document it came from.