Author: Portfolio Lease Administration & Advisory Team
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How A Lease Audit Can Boost Your Bottom Line
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Each year, commercial tenants collectively spend millions of dollars above and beyond their base rent in operating expenses. Unlike the rental rate that is negotiated and spelled out in the lease document, these operating expenses (OpEx) are subject to each property owner’s operating and accounting procedures. These charges are presented to tenants twice a year—in…
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As businesses hunker down and look for ways to cut costs and improve their bottom line, one area that typically gets overlooked are the operating expense charges and common area maintenance (CAM) charges in commercial leases. These expenses are confusing for most, and therefore may seem like an overwhelming challenge to tackle. Nonetheless, this could be an area where significant…
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Companies scrambling to adopt to ASC 842 lease accounting changes are evaluating a variety of software and third party options to help comply with the new standards. Lease administration plays a critical role in the accounting compliance. While at its base lease administration is built on quality data management, proficient lease administration can do so much more by allowing a…
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We are now in the final stretch for private companies to meet the deadline for the implementation of the new accounting standard, ASC 842. Issued by the Financial Accounting Standards Board (FASB) in 2016, ASC 842 goes into effect in January 2021 for private companies, and requires businesses to record lease obligations that are longer than one year on the balance sheet as…
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Whether you are a tenant in an office, industrial or retail building, you are likely familiar with the CAM or operating expense charges passed on to you by your landlord. In a triple net lease, tenants are responsible for 100% of their proportionate share of these expenses on top of their rent. In a gross lease, tenants pay for their…
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In less than a year, private companies will need to implement a new accounting standard for the reporting of lease obligations. The new standard, ASC 842, was issued by the Financial Accounting Standards Board (FASB) in 2016 and goes into effect in January 2020 for private companies. ASC 842 now requires lessees to record lease obligations that are longer than…
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With the required implementation of new lease accounting standards around the corner, real estate and accounting departments across the country are working feverishly to prepare for the new Financial Accounting Standards Board (FASB) Rule, ASC 842.
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Changes are ahead in the reporting of real estate leasing costs on financial statements, and corporations are scrambling to meet the upcoming deadline. During the process of conforming to the new standards, these companies are also discovering this is an opportunity to transform their business with improved systems and processes that can result in cost reductions and better efficiencies.
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The Financial Accounting Standards Board (FASB) recently issued an update (ASC 842) that will require businesses to rethink how they structure real estate leases going forward. The code change, which will be implemented in 2019 (2020 for private companies), requires companies to put the capitalized value of their lease obligations on the balance sheet as a liability and asset (“Lease…
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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…