Lease abstraction is an important function of commercial real estate. It provides structure to the lease document, making it easier to access important details. Organizations who want to stay competitive and grow their real estate portfolios need a smooth lease abstraction process. However, your capacity to abstract and update all of your lease in a timely fashion may be hindered by these 5 issues –
- Requirement to meet critical timelines
- Shortage of available resources to devote to the project
- High cost of operation
- Lack of knowledge of various lease administration platforms for data capture, customization, migration, and integration
- High potential for error
Here are some tips for an efficient lease abstraction process
- Have a template in place
Use a template that will capture the lease data in a structured format that can be easily retrieved and copied whenever required. The purpose is to filter the important data from the unimportant ones.
- Abstract important information
Capture all the data that are important and will have future implications. Dates, payments, terminations, renewals are few such data. Make sure to consider data from amendments, exhibits, letters and other documents.
- Bookmarking and document tagging
This process helps in locating key lease terms in just a few clicks, making leases and other documents easy to read and navigate.
Avoid using excel sheets because storing the lease data in a centralized system will ensure data security as well as easy and quick access. This also facilitates data updation.
- Update lease data
Abstracting the entire lease is a one-time process, but updating the data is an on-going process. Update the data timely to minimize the chances of missing critical due dates and actions.
- Outsource the lease abstraction process
Lease abstraction involves considerable labor-hours. Hiring and training staff to set-up an in-house lease abstraction team that includes quality auditors is very expensive. Outsourcing lease abstraction process is a better alternative for organizations, irrespective of the size of their real estate portfolios.
Since 2006, RE BackOffice has been a trusted partner to top-tier commercial real estate companies, retailers, and service providers seeking a strategic advantage. We have abstracted and managed over 300,00 leases for more than 1000 clients. For additional information about RE BackOffice lease abstraction & lease administration services, call 412.567.0010, email email@example.com or visit rebackoffice.com.