Property management companies need a fool proof lease administration process so that managers can organize and quickly access a property’s lease information and apply proper operational governance. In addition, these companies must periodically verify and update the lease documents and amendments to ensure 100% legitimacy regarding a property.
The scope of real estate leases depends on the type of property, the landlord and tenant agreement, and the local real estate laws. Well-defined processes are necessary to avoid misunderstandings that might lead to a lawsuit between the concerned parties. Property management companies resort to lease validation services to assess existing lease abstracts before venturing into critical projects such as commercial real estate acquisition, budgeting, and forecasting to avoid such discrepancies.
The following sections underscore the important elements of a clean, well-constructed lease.
Elements of a legitimate lease validation services
Regardless of a property’s location, a valid lease must comply the federal housing laws and encompass the following:
· Description of the property with technical specifications
· Personal information of the owner, contractor, and the tenant
· Commencement and end dates of the lease
· Financial obligations
· Maintenance and other general terms and conditions
How lease validation services helps a property management company?
Lease validation helps a property management company scan, verify, organize, and bookmark all the lease documents of the properties. During the lease validation process, the lease documents undergo verification by experts to validate the accuracy of the property’s technical, financial, and legal information. A detailed review—with all the critical data points and a plausible risk management technique—plays a vital role in the final layer of lease validation.
Benefits of lease validation services
1. Ensure information accuracy
A well-implemented lease validation process ensures high data accuracy. As a part of the process, the property manager collaborates with various teams such as in-house legal, external legal, financial services, property investment, lease administration and management, and transactions to ensure that each document contains accurate, consistent, and complete information.
As a result, these documents support transaction economics and provide legal protection to all parties involved in a lease.
PreludeSys has a strong lease validation service offering that reviews and validates critical terms such as:
- Critical Dates
- Rent Escalations, Percentage Rent & Other Charges
- Lease commencement letters, Amendments
- Tenant’s Proportionate Share, NNN Details
- Options
- Financial & Non-Financial Clauses
Our team of lease validation experts provides regular reports on all critical dates to ensure no lease element is overlooked. In addition, our dedicated account managers work with you to review upcoming options, LEDs, terminations, expansions, consolidations, rent reviews, and more.
2. Dynamic portfolio enrichment
Property portfolio charges are validated through a lease audit to ensure compliance with all relevant lease clauses, proper accounting standards, performance metrics, global market standards, legal precedent, and the parties’ intent. Lease validation experts possess extensive knowledge and follow the best practices for day-to-day lease management, accounting, and portfolio enrichment processes. These experts help you discover the opportunities that come from housing well-organized and up-to-date lease data for a real estate portfolio.
3. Prevention of cost overrun
Often, the expenditures of property management companies tend to skew from their forecasted amount in the scope document. A property scope document clearly defines the work that needs to be done, its necessity, its estimated cost, and its duration. Lease validation experts constantly monitor the expenses incurred to maintain or fix a property. Over time this process streamlines the actual expenses of a property and more closely aligns costs to those identified in the scope document. This results in optimal resource planning and efficiency of your workforce.
Why PreludeSys for lease validation services?
PreludeSys helps to validate, extract, and categorize lease information by diligently following the best practices in lease validation. We prioritize accuracy by minimizing the possibility of human error. Our reviewers—with extensive knowledge of lease abstraction complemented by a robust process—help our clients validate the data on time, and cost-effectively. We can also augment our services by updating the lease administration system based on the audit results. Learn more about our lease validation services here.
FAQ’s About Lease Validation Services
How does lease validation benefit our customers?
PreludeSys guarantees that our validation is accurate and reliable, with a faster turnaround time, resulting in quality and cost savings for our customers.
