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Underlease: meaning, definitions and examples

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underlease

 

[ ˌʌndΙ™rˈliːs ]

Noun
Context #1 | Noun

real estate

An underlease is a lease granted by a tenant (the original lessee) to a third party (the underlessee), allowing the underlessee to occupy the property for a specified term. The terms of the underlease may be different from the original lease, and the original tenant remains responsible to the landlord for paying the rent and fulfilling the terms of the lease.

Synonyms

sublease, sublet

Examples of usage

  • The company decided to underlease its surplus office space.
  • He signed an underlease with a new tenant for the warehouse.
  • Underleases are common in commercial real estate transactions.
  • The underlease specified all maintenance responsibilities.

Etymology

The term 'underlease' originates from the prefix 'under-', meaning 'beneath' or 'lesser', combined with 'lease', which stems from the Old French 'laisser', meaning 'to let' or 'to lease'. The concept has evolved in the realm of property law where tenants can lease out parts of a property they are renting themselves. The idea is that a tenant maintains a relationship with the original landlord while allowing another party to use the property. This practice became more prevalent in urban areas where subleasing provided flexibility for tenants and landlords alike, especially as real estate markets evolved. Generally, underleasing plays a significant role in commercial leases where businesses seek to optimize their space usage.

Word Frequency Rank

Ranking #37,841, this word is encountered relatively rarely in everyday English. It might appear in literary works or specialized texts but isn't essential for general communication.