Sandwich Lease

DEFINITION of 'Sandwich Lease'

A lease in which a party rents property from the property owner and then subsequently leases it out to another tenant. In a sandwich lease, the primary party is both a lessee and a lessor, meaning that the party both collects rent and pays rent. Not all property owners allow this sort of arrangement.

BREAKING DOWN 'Sandwich Lease'

A sandwich lease involves a party sub-letting what is already being sub-let. This type of leasing arrangement may come about if the primary party signs a long-term lease on a piece of property, but is either unable to use all the space or is looking to vacate.

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RELATED FAQS
  1. What are the differences between single, double and triple-net leases?

    Learn the ins and outs of net lease agreements, including the key differences between single net, double net and triple net ... Read Answer >>
  2. How does the value of the real estate impact the value of a triple net (NNN) lease?

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