Supporting the administrative costs of a company’s real estate can be a significant drain on resources. Organizing, managing and monitoring leases is a significant challenge, especially where there is limited in-house support. Any delay in payments or missed timeline can cost companies thousands of dollars. This makes on-time and accurate lease administration an important aspect of any company today. But is lease administration the core competency of most companies? Probably not. Even with an in-house lease administration team, the staff will not be able to meet demand as the portfolio grows. Also, adding more resources to handle the surge in tasks caused by new portfolios can put a big strain on the business.
Here’s why outsourcing can be a more efficient way to handle real estate portfolios.
- By managing the day-to-day lease administration activities, service providers can provide timely access to accurate lease data.
- Consistent execution of tasks will ensure all lease obligations are met on time.
- Service providers implement best practices that are aligned with the company’s goals. Companies can expect to see a more streamlined lease administration process.
- Service providers have a team of highly experienced staff having in-depth knowledge and experience in leading lease administration platforms.
- Lease translation has been an on-going challenge for companies with global portfolios. Service providers with real estate knowledge can provide full or partial lease translation services at economical costs.
- Service providers are SMEs with years of experience in handling the lease administration function. Companies can consult the service providers’ to utilize their expertise regarding the new accounting standards, software to be used and for planning, evaluation, and documentation of the lease administration processes.
- Companies have an option to scale the resources up or down as per their business needs. This will ensure continuity of lease administration activities without the additional financial burden.
- Companies can quit worrying about compliance with accounting standards as service providers will ensure all the lease data are up to date.
- Service providers train their staff continuously on new processes, the latest software, and new accounting standards.
- Service provider services is a virtual office that is accessible 24*7. In case of any eventualities, service providers can be banked upon to provide unhindered services.
Outsourcing works just like a company’s in-house lease administration experts except that they can handle a large number of portfolios more efficiently and will cost a fraction of the amount involved in hiring and training resources.
So, if you’re a company with geographically dispersed real estate portfolios, have come across inconsistencies in CAM reconciliation on more than one occasion, have overcharged/ undercharged tenants, or simply are shying away from maintaining accurate and consistent lease data due to resource and cost constraints, then outsourcing is for you.