Author: Portfolio Lease Administration & Advisory Team
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Six Critical Lease Dates for Businesses to Monitor to Avoid Costly Mistakes
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Imagine trying to manage your leasing portfolio, with renewal and termination option notice dates, security deposit or letter of credit reduction dates, tenant improvement allowance use-by dates, insurance renewals, expansion & contraction options, base rent increases, and other critical dates in an excel spreadsheet, all while simultaneously juggling your other job functions? Maybe you don’t…
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Every year at this time, usually between March and June, landlords throughout the land present their tenants with the prior year’s Operating Expense Reconciliation. And while they take months to prepare these statements, the last thing they want is for the business owners and executives who receive them to spend time reviewing this all-important document. So what exactly is this…
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As today’s business leaders strive to stay ahead of the competition and grow their bottom line, the last thing they have is spare time to spend worrying about real estate lease obligations. This includes the burden that may be put on a finance department or a facilities team whose efforts are better utilized focusing on the work environment.
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When tenants enter into a lease, in addition to the base rent, they typically are required to pay for their share of building operating expenses. This is true whether your lease is structured as “full service,” “modified gross,” or “triple net.” The intent is that these expense charges will increase at an inflationary rate over the lease period. Unfortunately, the…
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The term “audit” carries many negative connotations. From the burden of a corporate audit to the unknowns of a tax audit, everyone wants to steer clear of an “audit.” Because of this, many businesses avoid entertaining the process of a lease audit, and are potentially leaving millions of dollars on the table by allowing their landlords to charge them expenses…
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You probably don’t give your monthly office rent statement much thought. After all, they should simply reflect the rent due under your lease, so common sense says you have better ways to spend your time than analyzing them down to the last detail. However, January is the month when landlords typically update their tenants’ share of operating expenses for the…
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At some point during your lease term, it is inevitable that your landlord will send a request asking you to execute an estoppel certificate. For most tenants, the request for an estoppel comes as a surprise as it is a legal document and the landlord is likely asking for a turnaround of 10 days. So what is an estoppel certificate?…
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For the past four years, the Financial Accounting Standards Board (FASB) has been working to change the way tenants and owners of commercial real estate report their lease transactions on financial statements. It now appears we are in the final stretch, and significant changes are coming soon that will have a big impact on the bottom line for many companies.
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As a commercial tenant, this is the time of year when you can expect to receive your building’s operating expense reconciliation and budgets. If you have never taken the time to study these statements, it’s probably because the information was presented in a way that offered little detail. That’s by design.
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It’s that time of year again when Southern California landlords are sending out their 2014 operating expense (OpEx) budgets and 2013 reconciliations. If you are leasing commercial space, that means there’s no better time to review your lease to make sure you’re not paying more than you should be.
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Often overlooked, the establishment of your Base Year is perhaps the most important operating expense statement you will receive from your landlord. Ironically, since you do not pay any excess operating expenses during this period, it is hard to make this review a priority. At Hughes Marino we encourage you to be proactive and review and understand your Base Year…