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Commercial Sublease Agreement for United Arab Emirates

Commercial Sublease Agreement Template for United Arab Emirates

A comprehensive legal document governed by UAE law that establishes the terms and conditions under which a current tenant (sublandlord) grants a third party (subtenant) the right to occupy and use all or part of a commercial property. The agreement must comply with UAE federal laws, including the UAE Civil Code and Commercial Transactions Law, as well as specific emirate-level regulations such as Dubai's Law No. 26 of 2007. The document covers essential elements including rent, term, permitted use, maintenance obligations, and compliance with the master lease, while ensuring adherence to local registration requirements such as EJARI in Dubai.

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What is a Commercial Sublease Agreement?

The Commercial Sublease Agreement is a crucial document used in the UAE when a primary tenant wishes to transfer partial or full occupancy rights to another party while maintaining the original lease with the landlord. This document is particularly relevant in commercial districts and free zones across the UAE, where businesses often need flexibility in their property arrangements. The agreement must carefully balance the rights and obligations of all parties while ensuring compliance with UAE federal laws and emirate-specific regulations, including mandatory registration requirements. It typically includes detailed provisions for rent, maintenance, permitted use, and compliance with the master lease terms. The document is essential for businesses seeking to optimize their real estate costs or those requiring temporary commercial space in the UAE market.

What sections should be included in a Commercial Sublease Agreement?

1. Parties: Identification of the Sublandlord (current tenant) and Subtenant, including full legal names, registration numbers, and registered addresses

2. Background: Context of the sublease, including reference to the master lease and confirmation of authority to sublease

3. Definitions: Key terms used throughout the agreement, including Property, Term, Permitted Use, etc.

4. Grant of Sublease: Formal grant of the sublease and description of the subleased premises

5. Term and Renewal: Duration of sublease, commencement date, expiry date, and any renewal options

6. Rent and Other Payments: Rent amount, payment schedule, security deposit, service charges, and utilities

7. Use of Premises: Permitted use of property and any restrictions

8. Maintenance and Repairs: Responsibilities for maintenance, repairs, and improvements

9. Insurance and Liability: Required insurance coverage and allocation of risks

10. Compliance with Master Lease: Subtenant's obligations to comply with master lease terms

11. Assignment and Further Subletting: Restrictions on assignment and further subletting

12. Default and Remedies: Events of default and available remedies

13. Termination: Grounds for termination and consequences

14. Governing Law and Jurisdiction: Application of UAE law and jurisdiction for disputes

What sections are optional to include in a Commercial Sublease Agreement?

1. Fit-out Works: Required when subtenant will perform initial modifications to the premises

2. Trading License Requirements: Needed when specific licensing is required for the intended use

3. Shared Facilities: Include when subtenant has access to common areas or shared facilities

4. Special Use Provisions: Required for properties with specific use requirements (e.g., restaurants, retail)

5. Guarantees: Include when personal or corporate guarantees are required

6. Force Majeure: Optional expanded provisions for unforeseen circumstances

7. Environmental Compliance: Required for properties where environmental regulations are significant

8. Operating Hours: Include for retail or commercial properties with specific operating requirements

What schedules should be included in a Commercial Sublease Agreement?

1. Schedule 1 - Property Description: Detailed description of subleased premises including floor plans and measurements

2. Schedule 2 - Master Lease: Copy or relevant excerpts of the master lease agreement

3. Schedule 3 - Rent Schedule: Detailed breakdown of rent payments, escalations, and other financial terms

4. Schedule 4 - Service Charges: Breakdown of service charges and calculation methodology

5. Schedule 5 - Condition Report: Initial condition of premises including photographs and inventory

6. Schedule 6 - Fit-out Specifications: Approved plans and specifications for any permitted fit-out works

7. Schedule 7 - House Rules: Building rules and regulations

8. Appendix A - Required Insurances: Details of insurance requirements and minimum coverage

9. Appendix B - Form of Bank Guarantee: Template for any required bank guarantees

Authors

Alex Denne

Head of Growth (Open Source Law) @ Ƶ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Publisher

Ƶ

Document Type

Agreement Contract

Cost

Free to use
Relevant legal definitions





























Clauses



































Relevant Industries

Real Estate

Retail

Commercial Office Space

Food & Beverage

Professional Services

Healthcare

Education

Manufacturing

Logistics

Technology

Financial Services

Hospitality

Relevant Teams

Legal

Real Estate

Facilities Management

Operations

Finance

Compliance

Administration

Property Management

Contract Management

Business Development

Risk Management

Relevant Roles

Real Estate Manager

Property Manager

Legal Counsel

Facilities Manager

Commercial Director

Operations Manager

Chief Financial Officer

Real Estate Director

Compliance Officer

Contract Manager

Business Development Manager

Asset Manager

Leasing Manager

General Counsel

Chief Operating Officer

Regional Manager

Administration Manager

Industries









Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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