{"id":29665,"date":"2021-09-28T11:28:08","date_gmt":"2021-09-28T18:28:08","guid":{"rendered":"https:\/\/hughesmarino.com\/san-diego\/?p=29665"},"modified":"2023-04-06T16:20:45","modified_gmt":"2023-04-06T23:20:45","slug":"six-critical-lease-dates-for-businesses-to-monitor-to-avoid-costly-mistakes","status":"publish","type":"post","link":"https:\/\/hughesmarino.com\/san-diego\/blog\/2021\/09\/28\/six-critical-lease-dates-for-businesses-to-monitor-to-avoid-costly-mistakes\/","title":{"rendered":"Six Critical Lease Dates for Businesses to Monitor to Avoid Costly Mistakes"},"content":{"rendered":"

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\u2019t need to imagine\u2014this could be you! Similar to ensuring your landlord is following the terms and conditions of your lease when reviewing your annual operating expense charges, it is important to diligently track key lease dates to ensure you don\u2019t miss out on the lease options you negotiated for. Overlooking an important key date in a lease can be an easy mistake by an already busy team member when relying on an Excel spreadsheet, and this can manifest quickly into costly ramifications or missed opportunities for the company.<\/p>\n

By utilizing a lease administration team with the right experience and technology, companies can leverage a third-party partner to ensure no critical key dates are missed, the basic lease terms initially agreed to are being honored, and no employees are burdened with the responsibility of managing the leasing portfolio on top of their existing workload. When onboarding new clients, our Lease Administration team<\/a> often discovers key dates that have fallen to the wayside. Here are a few of the most common we flag for our clients:<\/p>\n

1. Security Deposit Reductions:<\/h3>\n

Occasionally, if a landlord requests a large security deposit up front, they may agree upon security deposit reductions on certain lease anniversaries, provided the tenant has fulfilled their obligations and are not in default. Since the reduction typically only occurs upon tenant request, this is an important key date to track to recover funds, and one that we often see missed.<\/p>\n

2. Renewal Option Notice:<\/h3>\n

Typically, landlords require a certain number of days or months written notice from the tenant if the tenant wishes to exercise their right to renew. Missing these key dates can create a sticky situation if the tenant wishes to remain in the premises but no longer has the guaranteed option to do so.<\/p>\n

\"Hughes<\/p>\n

3. Tenant Improvement Allowance Submittal:<\/h3>\n

Your brokerage partner<\/a> was able to negotiate a substantial tenant improvement allowance for your new lease\u2014nice work! It is now important to ensure construction is completed and the proper documents are submitted to the landlord within the stipulated allowance period in the lease. If the correct information is not submitted on time, tenants can forfeit tens of thousands of dollars (or more) of reimbursements from the landlord.<\/p>\n

4. Estimated Commencement & Expiration Dates:<\/h3>\n

Not all lease dates are set in stone upon execution of the lease. In fact, many commencement and expiration dates are contingent upon prior tenant vacancy, construction, and more. Since tenants are often anxious to move into their new space, ensuring that a commencement memorandum is signed is a step often forgotten. This can lead to issues down the road when the expiration date is approaching and the tenant and landlord have different dates on record, or there is a disagreement regarding rent increase dates.<\/p>\n

5. Base Year Resets:<\/h3>\n

Many brokers will successfully negotiate a new base year when applicable in lease renewals, and the tenant will not have to pay operating expenses<\/a> (OpEx)\u2014also known as common area maintenance (CAM) expenses\u2014during the new base year. Tracking this reset date is important to ensure there are no clerical errors on the landlord\u2019s side, causing them to erroneously bill for CAM (and your team to erroneously pay for CAM!).<\/p>\n

6. Termination & Expansion\/Reduction Options:<\/h3>\n

Is your company expecting to grow in the next few years, or perhaps has the potential to downsize? If a termination or expansion\/reduction option is present in the lease, there is likely a certain lease anniversary date upon when the option begins and when notice is required. Knowing when you may be able to terminate a lease early, expand into a nearby suite, or reduce space are other dates to add to the growing list of key dates.<\/p>\n

As you can see\u2014and may know from experience\u2014there are endless key dates essential to track in a lease, and storing these in an Excel spreadsheet leaves too much room for error. Instead, work with an experienced lease administration team who utilizes a sophisticated, web-based system to manage your portfolio. This is an investment that will quickly pay off in significant financial savings and increased confidence! By staying aware and ahead of key dates such as the ones mentioned above, companies ensure enough time to make the best decisions for the future of their leasing portfolio, while also avoiding costly missteps.<\/p>\n","protected":false},"excerpt":{"rendered":"

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\u2019t need to imagine\u2014this could be you! Similar to ensuring your landlord is following the terms and conditions of your lease when reviewing your annual operating expense charges, it is important to diligently track key lease dates to ensure you don\u2019t miss out on the lease options you negotiated for. Overlooking an important key date in a lease can be an easy mistake by an already busy team member when relying on an Excel spreadsheet, and this can manifest quickly into costly ramifications or missed opportunities for the company.<\/p>\n","protected":false},"author":72,"featured_media":29666,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_relevanssi_hide_post":"","_relevanssi_hide_content":"","_relevanssi_pin_for_all":"","_relevanssi_pin_keywords":"","_relevanssi_unpin_keywords":"","_relevanssi_related_keywords":"","_relevanssi_related_include_ids":"","_relevanssi_related_exclude_ids":"","_relevanssi_related_no_append":"","_relevanssi_related_not_related":"","_relevanssi_related_posts":"","_relevanssi_noindex_reason":"","footnotes":"","_links_to":"","_links_to_target":""},"categories":[1033],"tags":[],"publication":[],"video_type":[],"coauthors":[1122],"class_list":["post-29665","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-lease-administration-services"],"acf":[],"yoast_head":"\nSix Critical Lease Dates for Businesses to Monitor to Avoid Costly Mistakes - Hughes Marino San 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