Assignment

Assignment is the transfer of a party’s rights and obligations under a lease or contract to a third party. It differs from a sublease, where the original tenant stays primarily liable; an assignment generally hands the full responsibility to the new party, subject to the landlord’s approval.

Assignment clauses get negotiated closely in commercial leases, particularly for tenants who might go through a merger, an acquisition, or a change in ownership. Landlords commonly reserve the right to approve an assignment, and may bargain for a share of any profit a tenant makes by assigning a below-market lease.