Lease Audits: Accuracy = Higher NOI

November 3, 2022

Table of Contents

By Accounting Team. For more information, contact Robert Parmar

Asset Management is about making money.

Errors in tenant leases translate to a loss in your asset’s bottom line.

When we take over a property, our first action as the new Management company is to conduct a comprehensive review of all the current leases at your building.

This review serves two purposes:

We extract data to build our accounting and Property Management software
We identify errors in the current leases and develop an action plan to resolve

Lease audits are necessary based on the number of errors that we consistently uncover.

Here are some examples –

In 2020, we took over a building that was losing $4,315 a month because residents were occupying parking spaces but not paying their monthly parking charges because the prior management company had not accurately posted their lease terms in the accounting software.

This resulted in tracking to lose over $50K in revenue a year or at a 5% cap rate $1,000,000 in value on paper.

In a separate example, our lease audit revealed residents were supposed to be charged for monthly utilities. However, the terms were not correctly recorded in their leases.

Our best practices call for layers of checks and balances amongst our operating and accounting staff to minimize these types of problems to ensure the lease terms transfer to the accounting software correctly.

Ready for a better Property Management experience? Call us.

Robert Parmar

Managing Director

rparmar@smfield.com

206-920-3055

Danielle Daily

Communications Director

ddaily@smfield.com

703-972-5755

Key Metrics + Business Intelligence

by ddaily@smfield.com | Nov 3, 2022 | Accounting,Public Posts | 0 Comments

By Accounting Team. For more information, contact Robert Parmar When interested parties such as banks, partners, or investors need information about your asset’s...

Lease Audits: Accuracy = Higher NOI

by ddaily@smfield.com | Nov 3, 2022 | Accounting,Public Posts | 0 Comments

By Accounting Team. For more information, contact Robert Parmar Asset Management is about making money. Errors in tenant leases translate to a loss in your asset’s...

Observation Logs: Catch mistakes before they cost you big money

by ddaily@smfield.com | Oct 10, 2022 | Accounting,Public Posts | 0 Comments

By the Accounting Team, Summerfield Managment You’re managing multiple assets in multiple locations. Transaction volume is high at every building and it’s easy for...

3 Ways to Keep Your Buildings Running on Budget

by ddaily@smfield.com | Sep 26, 2022 | Accounting,Public Posts | 0 Comments

By the Accounting Team, Summerfield ManagementWhat’s most important beyond maximizing revenue? Keeping spending in check. With poor personal finance practices being the...

Managing Delinquent Payments

by ddaily@smfield.com | Aug 11, 2022 | Accounting,Public Posts,Useful Info | 0 Comments

During the COVID-19 pandemic, moratoriums created widespread restrictions on collection and eviction. Although the rules for collections changed overnight, Summerfield did not see this as a throw in the towel and walk away situation. We’re much more proactive than that.

Vendor Compliance – Protect Your NOI From Vendor Mistakes

by ddaily@smfield.com | Aug 11, 2022 | Accounting,Public Posts | 0 Comments

By Accounting Team. For more information, contact Robert Parmar Every building comes with expected maintenance expenses, but what about the cost of unexpected vendor...